Over the past year, I've written repeatedly about the need for segmentation to drive effective digital reporting, site testing and data warehousing. At the same, time, I've argued that digital segmentation extends traditional segmentation by adding a new dimension that is visit specific and absolutely essential to understanding the role of a digital touch in the broader customer journey. The purpose of this visit-specific segmentation is to identify the purpose of the visit and, when cross tabulated with who the visitor is (classic customer segmentation), creates a matrix within which interesting reporting, testing, and analysis can take place.
I've spent a lot of time describing how this segmentation works and explaining why I think it's essential to digital measurement. I've spent almost as much time debunking traditional approaches to enterprise reporting including sitewide KPIs of every sort. What I haven't done, is shown how Semphonic is actually embedding our Two-Tiered Segmentation into effective reporting systems.
That's an important gap, because I think there's a widespread perception that while a two-tiered segmentation might be great, it would produce enterprise reports that are too complex to understand or too difficult for the organization to use. It's the old "crawl", "walk", "run" discussion (which I loathe) and which I never hear trotted out with the words: "And we're ready to run." I don't think organizations should be content to "walk" through life and I'm not convinced that it's a good competitive strategy. On the other hand, I think it's fair to be skeptical of our ability to embed segmentation in reports without maxxing out their complexity. That has indeed proven to be a significant challenge.
Creating a good segmentation is hard work. No doubt about that. But most organizations don't begrudge the work necessary to create the segmentation. It's the incorporation of the segmentation into a reporting system that seems formidable. It's not so much the work involved as the apparent complexity of representing multiple levels of segmentation inside a digestible and understandable enterprise report that seems nearly impossible - particularly for a generation of digital marketers raised on the "five actionable KPIs" school of measurement.
In the last six months, I think we've begun to find our way through this dilemma and create reporting systems that not only capture the essence of a two-tiered segmentation in an easily digestible form, but create a "systems" view of Web performance that has tremendous resonance with the organization.
Our approach started with a simple idea. We wanted to show how the Website as a system works. To do that, we wanted to use the Two-Tiered segmentation because that's the best general model we've found for actually modeling a Website.
One of the examples I've used repeatedly to illustrate what we're looking for in a report set is based on common real-world experience. If I walk into a digital marketing manager's office and announce that traffic to the Website is up 5%, the first question out of their mouth should be "with whom?". Because traffic outside of audience is meaningless. If those visitors aren't the right people, then the traffic is pointless. Even in mass media, there's an implicit assumption that all reach is relative to audience. No matter how large his audience, Elmo won't sell your smooth vodka. On the web, bad traffic is ubiquitous and cheap. Audience does matter.
But once I've answered the "who" question, I'm not quite done. Because the next, equally important question to ask is why they came to the site. If the answer to the "who" is "customers", it matters (very) greatly whether they visited to get product support, to buy a new product, or to register a product. In fact, when it comes to measuring my success with that visit, it's pretty much all that matters. Success on the Website is almost entirely driven by customer goals. This doesn't mean you can't or shouldn't have business goals that are rather different from the customer's intent. A customer coming to your Website may be looking for an entertaining video or useful content. You may be hoping to get them to register or sell them a product. But their intent shapes which business goal you can reasonably choose, how you drive to that goal, and how you measure your relative success.
Of course, answering this "who" and "why" is the whole point our two-tiered segmentation.
The goal in building enterprise reporting systems is to help answer one seemingly very basic question: "Is our Website successful?" with the two-tiered approach. It should be clear that the answer to that question needs to be more complicated than a simple yes or no. A Website can be very successful with one type of visitor and visit and an abysmal failure with another.
So in building a basic site report, we wanted a method that would capture exactly this thinking and instantly show a decision-maker how traffic in the Website is driven by audience:
This is a striking representation of the Website as a system. On the left is traffic flowing into the system. On the right is successes on the Website. In the middle are the audience types (the who) driving that traffic and success. The segmentation becomes the transformation layer between traffic and success.
This type of report instantly answers the key question: "Is our Website successful?" and it does so in a manner that forces a much more intelligent appreciation of the question. Now, I can look at the report and instantly see that the majority of success on the site is driven by Qualified and Upsell Customers and that the Qualified audience is now struggling.
By clicking on that specific visitor type, I can drill-down into the next tier of the segmentation and see exactly how that audience is struggling or succeeding:
The Visit Type flow tells the decision-maker instantly which types of visits are successful and which aren't for every audience coming to the site. And it does so in the same visually consistent and strikingly rich paradigm.
We've taken this same concept of systemic flows and extended it into enterprise campaign reporting. Here's a mock from a marketing traffic report showing how each significant digital channel is contribution to both traffic and success. The report allows for the middle, transformation section to include either segmentation or additional levels of marketing hierarchy:
We've also taken these same concepts and built more analyst oriented, Tableau-style dashboards around them. I'll show some examples of these in a later post.
To me, these reports are by far the best enterprise-level reports we've ever produced at Semphonic. They are the first reports we've been able to build that force report consumers to think productively about Website performance and digital marketing and do so in an almost painless fashion. They are beautiful, coherent, and powerful. They can include powerful models of system performance and they force an organizational consensus around both segmentation and success. They are not mere exercises in Excel, Pentaho or Tableau because all the meat is contained within the segmentation. But they deliver the segmentation in a fashion which makes consumption a pleasure not a chore.
I'm convinced that this type of reporting will be at the heart of what we deliver for years to come. In fact, we're creating a network of partnerships to deliver integrated segmentation and reporting across a wide-range of enterprise tools. Our goal is to support access to system-based reporting built on two-tiered segmentation regardless of the underlying technology stack.
We've already instantiated these reports in Omniture with V15 or Discover and ORB (and I'm going to be doing a whitepaper and webinar on that) and we're delivering segmentation and automated reporting projects right now for multiple clients in our traditional toolset. We've created a partnership with iJento to deliver even more advanced two-tiered segmentation into SQL-Server where it can be accessed seamlessly with Excel or Tableau (and we've created this type of reporting in both). We've just inked a partnership with Infobright (from my recent webinar) and Pentaho, and you can see the fruits of that labor in a full-fledged demo (rolling out the week after the 4th of July) that joins the power of data-driven segmentation and visualization with a blazing fast columnar database and a really rich reporting and data exploration tool. This is awesome stuff - true Web intelligence on 30MM+ rows done in real-time.
I'd like to make this capability ubiquitous on every platform from SiteCatalyst to Hadoop, and while we still have a ways to go to get there, I'm fairly confident that the paradigm will hold. I think these reports answer more than the question "Is my Website successful?" - they answer the question "Can real segmentation be baked into powerful enterprise reporting appropriate to non-analysts?" I believe the answer is, resoundingly, yes.
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