Exam #1: Lectures 1-4

Tuesday, Feb. 6th, 2024

brand marketing

awareness
personality
reputation
viral consideration

direct marketing

a database-driven interactive process of directly communicating with targeted customers or prospects using any medium to obtain a measurable response or transaction via one or multiple channels

6 Characteristics of Direct Marketing

1. data-base driven

2. directly communicating

3. targeted customers

4. any medium

5. measurable performance

6. multiple channels

1994

the first banner ad

2001

the dotcom bubble burst

2003

CAN-SPAM Act

2007

the first-generation iPhone was released

customer data

all personal, behavioral, and demographic information gathered by marketing companies and departments from their customer base, crucial for informing and shaping marketing strategy decision

types of customer data:

1. personal data

2. engagement data

3. behavioral data

4. attitudinal data

personally identifiable information (PII)

any information that can be used to recognize an individual’s identity (ex. name, address, date of birth, etc.)

engagement data

tells you how customers interact with your brand via various marketing avenues

behavioral data

helps you uncover underlying patterns that your customers reveal during their purchase journey

→ transactional data
→ product usage
→ qualitative data

attitudinal data

driven by the feelings and emotions of your customers; how they perceive your brand

zero-party data

collected directly from users and customers via surveys, polls, etc.

first-party data

collected directly from users and customers from contract, newsletter sign up and registration forms

second-party data

collected as first-party data by one company and shared with another as a part of a data-sharing deal

third-party data

collected by data brokers or DMPs from multiple companies

customer data by formats:

1. structured data

2. unstructured data

structured data

refers to information that either has a pre-defined data model or is an organized in a pre-defined manner
→ usually numeric

unstructured data

refers to information that either does not have a pre-defined data model or is not or is not organized in a pre-defined manner
→ ex. images, videos, etc.

collection types:

1. declared data

2. inferred data

3. modelled data

declared data

is given by the users themselves

inferred data

is not given by the users directly, but is deduced from their behavior

modelled data

uses a large data set to find users matching a desired profile

types of data:

→ declared
→ inferred
→ modelled
→ structured
→ unstructured

Identity (ID) Graph

one database that holds customer profiles and all identifiers that correlate with individual consumers

relational database

a type of database that stores and provides access to data points that are related to one another

Recency, Frequency, Monetary Value (RFM) Analysis

a data-driven customer behavior segmentation technique

RFM Segmentation*

→ enables personalized marketing
→ increase engagement
→ creates relevant offers
→ increases retention

RFM Scoring*

evaluate the attractiveness of individual customers with respect to their transactions over time

traditional approach

→ define demographics and/or geographic traits of targets, create a product matching the need/want of the target, and select media with audiences of the target
→ useful for new products or advertising on traditional media

customer relationship management (CRM) approaches

→ use past transactional databases to identify customer segments with potential to maximize sales
→ useful for b2b sales, e-commerce, email campaign, product improvement

behavioral approaches

→ use online data tracker user behaviors to target customer segments in order to achieve desirable behavioral responses
→ used for ad campaigns

contextual approaches

→ this targeting refers to the placement of a display advertisement on websites that are directly relevant to the product being sold in the ad
→ used for display ad campaigns or outdoor media ads

audience-based approaches

→ the ability to take your full audience of prospective customers and segment it into groups based on different criteria (ex. interests, demographics, etc.)
→ used for social media ad campaigns, mobile ads

Claritas PRISM

finds prospective customers in the US & analyzes households in each major retail area by demographic, lifestyle, and purchasing characteristics then sorts them into 66 geo/demographic segments

facebook pixel

piece of code that you put on your website that lets you to measure effective advertising by understanding actions customers take on website

cohort analysis

subset of behavioral analytics that takes the data from a given dataset and rather than looking at all users as one unit, it breaks them into related groups for analysis

broad vs narrow targeting

broad:
→ good for building brand awareness
→ may find unexpected audience
→ small response rate (need a large budget)

narrow:
→ better response rate
→ may end with a small audience

magic of 10%

only 10% increases in marketing outcomes create almost 200% increase in profits

Testing (experimentation or A/B Testing)

manipulates one or more controllable factors (independent variables - causes) to determine their influence on events or outcomes (dependent variables - effects)

types of tests:

1. list tests

2. offer tests (ex. one free ticket)

3. creative tests

4. contact strategy tests

top of funnel (TOFU)

Goal: Awareness
→ generate interest, capture attention initiate customer journey
→ ex. PR, SEO, etc.

middle of funnel (MOFU)

Goal: Consideration
→ nurture and guide leads toward becoming qualified customers
→ ex. direct emails, demos, etc.

bottom of the funnel (BOFU)

Goal: Conversion
→ convert potential customers into actual customers
→ ex. limited-time offers, discounts, etc.

return on ad spend (ROAS)

total campaign revenue / total campaign cost
→ 3-4 ROAS is considered as a good ROAS in usual marketing campaigns

views (Instagram vs YouTube)

Instagram looped views are not counted so only the first play is a view — 3 second play

YouTube wants viewers to stay longer on the platform — 30 second play

control group

a group of subjects on which the experiment is not conducted but that is otherwise identical to the test group

test group

a group of subjects on which the experiment is conducted

random assignment

both control and test group subjects must be assigned randomly so that differences between groups occur by chance only

null hypothesis (H₀₎

that statistic that there is no difference between the means of the groups being compared

alternative hypothesis (H_a)

the hypothesis that is determined when a null hypothesis is proven wrong

statistical test (chi-square test)

the test stats reject the null hypothesis when the probability that the observed result occurs is less than 0.05 (p-value)

Google Analytics

web analytics service offered by Google that tracks and reports web traffic

Google Tag Manager (GTM)

a tool that enables marketers to install, store, and manage tag tracking user activities on website without modifying the code

session

starts when the user visits website/opens app & ends when the user exists and have been inactive at least 30 mins

engaged session

→ last longer than 10 seconds
→ had a conversion event
→ had 2+ screen/page views

event

any interaction or activity that a user has with website/app

conversion

particular events marked by GA4 users as important metrics on website (purchase/subscription)

affiliates

links on affiliate sites

cross-network

ads that appear on a variety of networks (ex. search and display)

direct (brand marketing)

a saved link by entering your URL

display

display ads, including ads on Google Display Network

email

links in email

referral

non-ad links on other sites/apps (ex. blogs and news sites)

organic search

non-ad links in organic-search results

organic shopping

non-ad links on shopping sites like Amazon or eBay

organic social

non-ad links on social sites like Facebook or Twitter

organic video

non-ad links on video sites like YouTube or TikTok

paid search

ads on search-engine sites like Bing or Google

paid shopping

paid ads on shopping sites or retail

paid social

ads on social sites

paid video

ads on video sites

paid other

ads but not through an ad identified as search, social, shopping, or video

RACE

reach
act
convert
engage

agency holding companies

large corporations that own multiple advertising agencies

What does RFM stand for?

recency, frequency, and monetary value

four primary uses of customer data

1. targeting

2. personalization

3. product recommendation

4. customer experience design