I got curious. I was reading through the LinkedIn Groups and came across the obligatory weekly “Print Is Not Dead” post. I wondered how many of these articles had actually been written, so I Googled it. Here’s what I found out:
Print is Not Dead – About 216,000,000 entries (in .42 seconds, wow!)
Print is Still Relevant – About 140,000,000 results (0.29 seconds)
The Value of Print – About 1,020,000,000 results (0.43 seconds)
Enough, Please. The Point Is Made.
This may be the shortest blog post I’ve ever written. Two points:
- There’s no real need for printers to continue justifying our industry. The recession has been over for years. We’re not going back to the “good old days,” but the future doesn’t really look so bad for those of us with energy and a little imagination.
- There’s no need to continue making the same arguments. Look at the brand names inside your mailbox – pretty good proof that some influential companies think that print is still relevant.
Where Monty Python Comes In
What happens to the poor old man? To end his protestations of “I’m not dead yet!,” Eric Idle whacks him over the head!.
I’m afraid that at this point the hundreds of millions of articles that try to convince the public that print isn’t dead may be doing more damage than good. They may be convincing people that we really are dead and only think we’re alive. Let’s move on. There’s plenty of living opportunity to talk about. I’m casting the first vote for a moratorium on further “Print Is Not Dead” articles. Anybody else in?
When my oldest daughter was in the second grade, Beautiful Wife and I were puzzled at the papers she brought home each day. We saw lists of spelling words, yet misspellings of the same words on her papers were never noted or corrected. We scheduled a conference, and met with her young teacher, fresh out of an education program at a local university. She did most of the talking and every second word was an acronym or a term colloquial only to those in the education realm. After letting her ramble for a few paragraphs, Beautiful Wife stopped the conversation and asked for a translation into English. The poor young teacher stammered and stuttered for a sentence or two, then lapsed back into “eduspeak.” She was unable to translate and we both left scratching our heads.
At the time, it was unclear whether the schoolteacher had a firm grasp on her own jargon. Beautiful Wife contended that she did, but was just unable to communicate in a way that was understandable by others. I wasn’t so sure. Certainly the acronyms and eduspeak sounded as if they had meaning, but I couldn’t detect a pattern in the way she constructed her sentences. There were lots of words, but she never seemed to reach any conclusions or determinations.
When marketers talk about Key Performance Indicators (KPIs), we have to be careful that we don’t fall into the same pattern. There are plenty of acronyms and ratios to consider. It’s not that there is any lack of opportunities for measurement, rather that the measurements must be meaningful. Last week’s post made an analogy between marketing metrics and the most important tool in every carpenter’s kit, the 25′ tape measure. The point was that while measurement is equally important for carpenters and marketers, the units of measure aren’t very well established for marketers and the tools can be more difficult to use that a trusty yellow Stanley tape.
Choosing the best measures and executing them can be difficult, especially for small businesses. Because many smaller printing businesses don’t have sophisticated marketing automation or CRM platforms, relating marketing data directly to sales data can be problematic. Frequently, the best we can do is compare trends. Even if we can’t directly correlate the data to desired outcomes, we can frequently make an educated guess as to the relationships. There’s really nothing wrong with this kind of conjectural measurement, as long as we’re honest about the limitations of the results. Today’s post will look deeper into the question of KPIs, and we’ll talk about some possibilities for measurement that can produce meaningful information for even the smallest companies.
Business KPIs and Marketing KPIs
Because its easier, let’s approach the problem backwards. We’ll look at the outcomes first, because they’re easy to determine. The obvious outcomes that we want to measure are the big goals that every business has in common. We’ll call these business KPIs. For instance:
- Increasing revenues
- New customers
- Repeat customers
- Increasing profits
- New product growth
As we dig into this, it quickly becomes obvious that there are opportunities to define multiple KPIs in all of these areas. For instance, if we want to look at customer growth, we might choose New Accounts/month as a KPI; or if we want to get more sophisticated we might measure Net New Accounts/month and subtract lost accounts from the new account additions. A broad measure of gross profit margin for the company is certainly a KPI, but it may also make sense to look at departmental margins or even margins for a specific product line, especially if it is in the introduction phase of the product life cycle. Here are a few more specific ideas for printing and mailing companies:
- Revenue/Order (average invoice dollars)
- Estimates/Order Ratio
- Repeat Orders/Month
- Change in Value/Profitability of Repeat Orders
- New Order Profitability
These kinds of business KPIs are useful because they provide a picture of the general direction in which the company is moving. But marketers want to try to understand the causes of the movement. This requires a different set of measurements – we’ll call them marketing KPIs. We’d like to know which marketing efforts are driving growth and which ones are wasting time, effort, and money. If we can link marketing KPIs to business KPIs, we can do more of what’s working and less of what’s not. We may also be able to project some results – if Marketing Activity A consistently leads to Business Result B, then doing more A should produce more B, right?
What marketing activities might be worth measuring? Here’s another completely inexhaustive list:
- Lead Generation
- Website Interaction
- Process through (a defined) sales and marketing pipeline
- Repeat Customer or Prospect Interaction
Most businesses have some system in place that can generate the outcome information needed to measure business KPIs. At small printing companies, it may be a POS system like Printsmith or accounting software like Quickbooks. The marketing data can be more difficult to collect. Some data can come directly from the website. For example, goals can be set up in Google Analytics to track the number of landing page conversions and Google will provide some quantitative insight on where the referrals to the page came from (e.g. social channel, email, etc.). Email opens and clicks-through can be a data source. If you can afford a marketing automation platform, it’s easier to obtain this kind of information. Most of these systems also allow definition of a marketing/sales pipeline and can score leads and interaction at various points in the process. CRMs are more labor intensive because they require input from human beings who track individual interactions with prospects and customers. Adding a lead source field to your CRM is a good idea and it may also be worthwhile to track checkpoints for information requests, multiple contacts, and certainly for first or repeat transactions.
In a small business environment, collection and analysis of some of this data may simply take too much time and effort. It’s important to select at least a couple of marketing KPIs that can be measured and can be (either directly or conjecturally) correlated with the business KPIs. Again, here are a few possibilities for printing and mailing companies:
- Number of leads/lead source
- Landing page conversions/specific product or service revenue
- Lead scores (i.e. stage of pipeline)/new order revenue
- New leads generated/new customer transactions
- Repeat interactions (e.g. email opens)/repeat business (or new accounts)
Wrapping it up (with no jargon)
A lot of this really boils down to just counting stuff and relating the numbers, and maybe that’s all that’s needed to explain the whole KPI concept in a very simple way. With KPIs, marketers are looking for cause and effect, meaningful relationships that will tell them what’s working. That’s a basic explanation that makes sense, without any jargon or acronyms. What do you think? What’s your company’s approach to KPIs and what specific numbers do you look at each month?
Way back in the last century, I had the pleasure of working for many years in the “lumbah bidness.” The great company that I worked with was very Southern and the drawling, mush-mouthed elocution went along with the business and actually seemed to help the marketing effort as we shipped our treated lumber products primarily into “Yankeeland.” Actually, the backwards accent belied a great deal of thought and intelligence that supported the company. We were engaged with our customers, participating frequently with them as they talked to contractors and consumers. One of our more popular programs was the “deck clinic.” We’d partner with a lumberyard customer, invite the town, and teach them how to build a deck.
The more audience interaction you could provoke, the better the clinic ran, so our representatives were trained to ask lots of questions. “What’s the most important tool in the toolbelt?” was one of the first questions asked each time. “Hammer,” someone would shout. “Skilsaw, level, drill,” and other answers soon followed. Eventually someone would say “tape measure,” and our folks were trained to answer in their best Southern drawl:
“Yep, ‘das it. Without a tape measure, you cain’t build nuthin’.”
Marketing: No Standard Units of Measure
Now, let’s apply the story to marketing and see what happens. When you’re building a deck, a 25′ Stanley tape measure is invaluable. It is possible to build without a tape measure, but the results will be less than spectacular. Likewise, marketing efforts that aren’t measured tend to be . . . ummmh imprecise. But there’s a big problem. If you purchase two 25′ Stanley tape measures and set them side by side, the inches scaled on the tape will be identical. There’s a standard unit of measure. That’s not the case with marketing. There are certainly tools that can be used for measurement, but there’s no great agreement on the standard unit of measure.
I was reminded of all this last week in an ongoing conversation that began with Kate Gansneder’s suggestion of a topic for our next 21/20 Marketing Hangout. She suggested Key Performance Indicators (KPIs). Kate had just composed an excellent article on CRMs and Marketing for PrintMediaCentr, which was followed by a discussion on #printchat, the weekly Twitter chat about all things print. Kate’s article and the online discussion focused primarily on the measuring tape, the Customer Relationship Management (CRM) system. In her article, she provides a good list of potential metrics, but really doesn’t dig into the difficulties involved in obtaining them. The conversation on Twitter was similar. There was much talk about the various CRM platforms and how they were being used, but little was said about the specific measures.
What to measure is a big topic, and I was curious, so I asked a question about KPIs in a couple of social media forums last week. There were some good comments, but they did more to illustrate the problem than to prescribe a solution. The answers indicated a couple of schools of thought regarding the measures, but no universal agreement on which KPIs are important or how the data can be collected.
Marketers and Data Geeks
Let’s lump all of the marketers into the first school. This is unfair, of course, but the tendency for marketing types is to look first into their own spheres of activity. They’re concerned with the response that is generated from social media and what’s happening on their websites. Much of the data they track comes from counting interactions. Some typical measures for this group:
- Social Interaction: How many retweets or likes?
- Referral traffic on the website
- Email opens and click-throughs
- Website form conversions
These measures are important and they can certainly prove effectiveness in building an audience and generating engagement. But should they really be called Key Performance Indicators?
Let’s call the second school Data Geeks. These folks would like to quantify a larger picture. They want to know whether increases in web traffic are producing results for the business and their inclination is to try to link specific online actions to quantitative results. For instance:
- New Customers
- Product Sales
- Repeat Business
In my thinking, these kinds of measures are ultimately more important to the success of a business. A measure of leads in process at various stages of the conversion pipeline relative to new customer production could be a valuable predictive indicator of business in the next quarter. It’s easier for me to define this as a KPI.
Conjectural Data and Correlative Data
How to gather the data? The tools are there but CRMs are not as easy to use as my Stanley 25′ tape. For larger companies with money, marketing automation systems like Hubspot and Marketo can centralize data collection from a range of channels that include social media, email, and website conversions. Companies with in-house IT capability can integrate these platforms with Management Information Systems (MIS) to provide meaningful correlative data that can be connected directly to customer acquisitions, sales and profit.
Data collection and correlation can be problematic for smaller businesses, who may have to rely more on conjectural data. They can use some of the same data collected by the marketing folks, but take it a step further. For example, a Google Analytics goal can be set up to measure conversion on a specific website form over a period of time. These conversions can be compared with related product sales over the same period. It may not be possible to directly track the form conversion to the final sale, but the correspondence between increases in website information requests and final sales is a valid conjectural link.
Affordable CRM platforms like Insightly and Zoho are available to small businesses that may also allow them to track lead source data and link it directly to new customer acquisition or even (potentially) product sales, although the time required to generate and correlate the sales information may not be worth the effort. For the most part, this kind of tracking also produces conjectural conclusions, but they can be valuable indicators of marketing ROI.
Half Done, More to Come
There’s a lot more to this topic, but this is quite enough to cram into one blog post. In Part II, we’ll look more closely at specific KPIs that can be valuable measures for printing businesses. These metrics are critical for marketers in the brave new digital world and the printing industry seems to be a bit behind the curve. If your printing company is making effective use of CRM or marketing automation to track KPIs, I hope you’ll comment to share what you’re doing.
The Obligatory Call to Action Message
If your printing company needs help with marketing plans, projects, or implementation please get in touch. DP Marketing is a small company with practical ideas. There’s no risk – first conversations are absolutely free, and we usually come up with at least a couple of good ideas.