Organic Percentage as a Key Targeting Variable
I spoke at a conference a few weeks ago, and the topic of "attribution" was popular. Folks wanted to know "how" to attribute orders to marketing activities.
The most important variable to store in your database (for attribution purposes) is the "organic percentage". At a customer level, you calculate the percentage of demand that your mail/holdout tests show happens regardless of catalog mailings (in a print environment). When evaluating your matchback results, you discount the results by the organic percentage.
In other words, if your matchback analytics (a lousy form of attribution) show that you generated $3.50 for a segment of customers, you discount the matchback analytics by the 50% organic percentage (in the example above) ... and that means that a $3.50 matchback result is actually a $1.75 incremental outcome based on mail/holdout testing.
And the difference in results is staggering. When you run your simulations for optimal page counts (and yes, the ad costs above are inaccurate due to printing efficiencies, but they're outlined as they are to prove a point), you see dramatic differences between matchback analytics and the far more accurate outcome calculated via the organic percentage.
- Via matchback, your optimal page count is between 80 and 192 pages ... fatten-it-up and let-er-rip!!!
- Via the organic percentage, you are limited to a tiny 32 page catalog.
The former is inaccurate (and benefits the entire print ecosystem).
The latter is far more accurate (and benefits your brand).
Store the organic percentage in your database at a customer level ... you know how to do this, you have your mail/holdout tests to calculate the organic percentage.
Yup, this targeting stuff works!
by Kevin Hillstrom, President, MineThatData