Month: April 2017

UTM Tagging Explained

If you are marketing manager engaging in online marketing you need to know and understand your customers. Knowing who visited your website, how often customers return and which marketing activities directed customers to your site is imperative for an optimal online marketing budget allocation. Thereby UTM tagging helps a lot!

Why is tracking and analysis so important?

When it comes to online advertising, your objective should be to analyze the reach and effectiveness of every single marketing activity you are doing, in order to know if the return on investment justifies that specific activity.

For example: Potential customers see a banner ad of your company on Facebook. Some of those who saw the ad might feel intrigued and click the banner. Upon clicking they are being directed to your website where some of the visitors end up buying one of your products.

As a marketer, you want to track & analyze how many customers saw and clicked this banner ad. You need to know what cost you incurred to run this ad and most importantly if these costs were reasonable compared to the revenue and profit margins of the sales you made.

Google Analytics – a free Tracking Tool

Google Analytics is the most popular free tool to track the source, behavior and revenues of every website visitor through simple pixel-tracking!
The data collected by Google Analytics enables marketers to deeply analyze the reach and efficiency of every online marketing activity.

4 Ways to access Websites

Google Analytics distinguishes four different ways to access a website:

direct – A visitor types the internet address of your website directly into the browser.

organic – An internet user is accessing a search engine like google or bing. On those pages he searches for specific keywords. Upon being presented with search results he accesses the company’s website through clicking on the search results. This is considered as unpaid or “organic” search.

referral – Website A links to the company’s website B, the target page. If a visitor on website A clicks on that link and is being directed to website B, Google Analytics identifies website A as the referrer.

marketing campaign – this means paid or unpaid advertising links on other websites.

For example: paid banner ads, paid Google Adwords text links or unpaid links on Twitter.

Google needs your Help for correct Tracking!

Website visits that originate from marketing campaigns need to be accurately marked so that Google Analytics is able to correctly relate these visits to its original advertisements. There are several methods to do that, but Google Analytics prefers the use of UTM-parameters- called UTM-tagging. These parameters precisely describe the source of a marketing activity using five dimensions.
The goal of every online advertisements is to garner interest and to transfer a potential customer to the advertiser’s website. Therefore, the company’s URL is added to the online ad. Additionally, the UTM-parameters should be used to track information about the click’s source. Conceptual it looks like this: [www.your-target-page.de] + [UTM-parameter]

Use UTM-tagging so Google Analytics can track correctly!

The five UTM-parameters which can be used for a marketing campaign are source, medium, campaign, term and content.

source: Source refers to the name of the website on which a company is advertising, e.g. Facebook, Google or Zanox.

medium: Medium refers to the channel. Usually channels are groups of similar advertising measures, e.g. Affiliate, Social Media, Display, Email etc.

campaign: This value should contain the name of the advertising campaign.

The parameters term and content are optional and can be used in different ways. Usually they are used for paid traffic only. The following are some suggestions:

term: Term can contain the paid keyword or the banner ad.

content: This tag should refer to the Ad-Group or the banner’s position on a website. It can also specify the content the banner is showing.

If these parameters are filled in the right way, it is possible to understand from which channel, partner and campaign the visitor came and which banner or keyword he clicked on. If however UTM-tags are not being attached to the link of an advertisement Google Analytics automatically classifies the website visit as „referral “. Without these parameters, an exact allocation of website visits to its origin is impossible.

UTM-Parameters must be added correctly to the target-URL

UTM-parameters have a special notation that has to be complied with for Google Analytics to match them correctly.

The ? demonstrates the end of the original URL and the beginning of the tracking code
Each parameter starts with utm_ followed by the type of parameter and =
This is where the individual value of the parameter is added. (Notice: At this point lots of things can go wrong!)
The & divides the parameters from each other
Spaces are not allowed in URLs which is why they are not allowed in UTM-tags either. If there needs to be some space %20 can be the placeholder; for example „Summer%20Sale “. Google Analytics will recognize this as a space.

The Google Campaign URL-Builder can help to create the right URL.

Example for a URL using UTM-tags:

5 Important Rules to Avoid Mistakes

Use consistent guidelines within a company
Every employee of a company running online marketing campaigns should be using the exact same UTM-tags for the same thing!
Be consistent in naming the UTM-tags
„Cpc“ and „paid“ may stand for the same type of traffic, but Google Analytics will consider them as two different things. You also have to keep the use of lower and capital letters in mind: „Paid“and „paid“ would end up as different results. The use of small letters is more common regarding utm_source and utm_medium.
Choose the right value.Values for UTM-parameters should be chosen carefully. The following are some suggestions:
- utm_medium: This contains a short form of the used channel, e.g. „email “or „eml“ could be a good choice for E-Mail. It is not unusual to name every paid traffic „cpc“. Google Analytics automatically does this with every traffic coming from Google Adwords, if no other term has been chosen.
- utm_source: This value should contain the name of the ad platform, the affiliate, the e-mail service or the publisher that is used, e.g. „facebook “, „affilinet“, or „mailchimp“.
- utm_campaign: This should contain the name of the campaign an ad belongs to. If there is a campaign called „Summer sale 2017“ coming up, every advertisement should be tagged as utm_campaign=„SS+2017“. The campaign value should be short, descriptive and easy to distinguish from other campaigns. Campaigns in different countries should start with the country code: e.g. GB, DE, US, etc.
- utm_term: This is where the paid keyword or the banner is noted. If there should be an affiliate link the value {{pubid}} serves as a placeholder for the ad publisher’s ID.
- utm_content: This contains a description of what the banner is showing or the banners position on a website. Due to this all banners of a campaign can be distinguished from each other and the most successful ones can be identified.
  
  In this channel listing SEA (Search Engine Advertising) is not mentioned because it is a special case. This will be subject of another post!
Source & Medium tags should not be mixed up
This is a common mistake which leads to incorrect results.
Adding sub domains
If a company (e.g. my-shoeshop.com) has a blog page with a different domain (blog.my-shoeshop.com) Google Analytics needs to know that this URL refers to the same company. For example. Let’s say a facebook visitor clicks on an ad and lands on the company‘s blog post. On the blog she clicks a link that leads to the company’s website. Google Analytics will identify the blog page as the referrer, however, the actual and relevant origin of this visitor is Facebook!
The Google Analytics support provides help for cross domain tracking.

3 URL Examples for different Channels

Display

This ad in the paid partner content section on cnn.com is one out of three. This one is placed on the left side. Its position is mentioned in utm_content.

Affiliate

This example shows a blog post about a perfume on britishbeautyblogger.com. There is a textlink below the picture linking to the online shop escentual.com. In this case utm_term contains not a paid keyword, but the type of link.

E-Mail

The following example is an e-mail newsletter with several links. The last one leads to one domain of hertz.com. Utm_source is spirit, because Spirit Airlines are the ones who sent the e-mail.

Companies also send e-mails which only contain links to their own website. Although this means unpaid traffic, those links should be tagged anyway to evaluate the efficiency of the product promotions in that e-mail. In this case utm_content could be filled to differentiate between the ads.

Fazit

Clean UTM-tagging is important to allocate every website visits to its channel (medium), its source and its campaign. With UTM parameters, Google Analytics is able to identify the reach and effectiveness of every advertisement. Thereby, future campaigns can be planned accurately.
E-Commerce tracking and cost imports into Google Analytics are needed for an estimation of the cost-benefit efficiency. These are further topics dealt with in upcoming blog posts.

PS.: Applicata provides an URL builder as a part of the software solution. This URL builder is able to automatically create consistent UTM tags and target URLs for new campaigns. That is how we ensure clean tracking for our clients.

Carsten Petzold – Interview about Marketing Costs and Raw Data

1. Can you describe Applicata in three sentences?

Applicata is a software-as-a-service company which deals with business intelligence and online marketing. Based on actionable insights we can help our clients to grow faster and more profitably. Additionally, we offer special business intelligence consulting services.

“In my previous company I analyzed data by myself in Excel. That was unreliable, slow and inconsistent.”

2. Why did you incorporate Applicata?

My co-founder Sebastian Rieschel incorporated the company and I joined in later. I spent my entire career with e-commerce start-ups and and first hand experienced the struggles that we now solve for our customers. I know how it is to run complex marketing campaigns across several channels.

In my previous company (www.ltlprints.com), I built a solution to analyze data by myself in Excel. With the help of macros, I established dashboards and evaluated reports in Excel manually.

However, this self-built Excel solution was unreliable, error-prone, slow and I never had the consistent data basis, I wished for.

Applicata offers exactly that: quickly available and correct data of all key figures in the company. See the tremendous benefit of Applicata I joined the company with great excitement shortly after the incorporation. But there is also a personal side of the story. With Sebastian I found the right partner with whom I want to build up Applicata on a long-term basis.

“Companies should be willing to invest more upfront and determine the “customer lifetime value” to optimize the long-term relationship.”

3. From your experience, which are the most common mistakes made in online marketing?

In most companies, there are experts working only on their marketing channels, optimizing their channel individually as if they were independent of all other marketing activities. However, this focus is insufficient for an overall optimization of all marketing campaigns. The mutual interference of the individual channels should be taken into consideration in one consolidated Multi-channel marketing approach.
Often the focus of companies is not set on return on investment (ROI) or return on adspent (ROAS) but rather on “Vanity KPI” (i.e. key performance indicators that are nice to look at but really do not matter in the end), such as web site visits, revenue and bookings. This mainly stems back to inconsistent and manually aggregated data. Lacking automatically aggregated marketing costs and margins companies often fail to achieve full cost control. But without cost control companies cannot manage their marketing activities by ROI of every advertisement and contribution margin per customer.
Another problem is that many companies lack a concise view on every individual customer due to missing raw data. For example: Many companies simply use data from Google Analytics to analyze web site visits. Google Analytics however does only provide sampled data (at least in the free version). That means, you never know exactly which individual user clicked on what advertisement(s) before visiting your website. Good raw data both about offsite and onsite behavior and an individual buying history of every customer, however, is the basis for efficient online marketing.
Companies often only invest as much money in their customer acquisition as they immediately return in form of a net contribution margin of the first order. However, companies should be willing to invest more upfront and accept a negative contribution margin for the first order If they can determine the “customer lifetime value” (CLV) of every customer. Applicata’s clients achieve growth and sustained profitability by accepting losses on the first order while optimizing the long-term relationship with and boosting the customer lifetime value of every new customer.

“Deploying a scalable and flexible 3^rd party BI solution is always cheaper and faster than a self-built solution.”

4. What should start-ups consider when they seriously want to come in touch with business intelligence?

Firstly, they should get in touch with industry experts to get a feeling for the opportunities of a BI investment. A vision for corporate growth through business intelligence and a data-driven culture needs to be derived. Due to a lack of experience, founders often do not know and grossly underestimate how much can be achieved by using a BI solution.

Furthermore, start-ups should map out a corporate growth strategy. A BI software-as-a-service by itself is insufficient. Online companies need to establish teams and acquire skills to exploit the full potential of business intelligence solution.

Additionally, I recommend that every online start-up should make a detailed cost-benefit analysis of an external software solution versus a self-built solution. One should not be blindsided by the efforts and hidden cost of an inhouse business intelligence solution. Considering all direct and indirect cost, deploying a scalable and flexible 3^rd party BI solution is usually 7 to 10 times cheaper and faster than a self-built solution.

5. What does your perfect free day look like?

My perfect day starts with sport – going jogging. After having a nice family breakfast, I spent the day with my family on an adventure playground or at a lake away from Berlin. In the evening, I savor great conversations with my friends and a glass of wine in front of a fireplace.

Growth through Online Marketing – The Big Opportunity

Ensuring long-term corporate growth and achieving sustainable profitability represent the primary goals of most companies. To achieve this goal steady customer acquisition and high customer loyalty provide the basis for any business’s success.

The digital transformation and especially the ever-increasing popularity of the internet continuously provide a huge growth potential for companies, that should not be untapped.

The Genration Y (those born between 1980-2000) constitutes the main target audience of potential customers for online products and services. They spend in average four to six hours per day online and can easily be reached through advertising messages across various online media outlets but especially through social media.

Nevertheless, the internet also provides numerous opportunities for older generations making everyday life easier for them. Consequently, the range of new potential customers is wide. Companies in nearly every branch and industry have no alternative to using the growth opportunities of the internet through professional and strategic online marketing.

After a robust growth in online marketing over the last 10-15 years, the importance of online advertising still increases rapidly.

The investments in online advertising in Germany have been increasing continuously for years now. According to forecasts, they will further rise over the next years.

Companies, which do not invest in online marketing, risk to be left behind by the digital competition.

The Big Guys Dominate and Benefit

Market leading companies, such as Amazon, Ebay and Zalando, have a crucial advantage over middle-sized online-advertisers and start-ups: They have control over sophisticated technology and established efficient internal processes in their online marketing departments, which allows them to extend their wide reach continuously.

New customers are steadily acquired and long-term loyalty of existing customers is being gained. Consequently small- and mid-sized companies and established brick-and-mortar businesses have been losing market share to these “Big Guys”.

The Big Guys reinvest their profits into the continuous development of technologies and processes, in order to further extend their enormous market power.

How can Mid-Sized Companies Close the Growth Gap?

Start-ups and mid-sized companies have a strategic disadvantage competing with the Big Guys, as they often neither have the right technologies or the digital, efficient processes, nor the needed expertise at their disposal, in order to fully exploit their growth potential.

There are three opportunities for Companies to compete:

Maintaining the status-quo and continuing to work without changes is an option, but not a good one. The problem is, that the company’s potential is not fully exploited, which leads to growing gap between potential and realized revenue. A business’s demise is inevitable, if it does not adapt to the digital transformation.
Looking for solution inhouse: Many companies try to build solutions and technologies in-house and seek to acquire knowledge exclusively internally. However, this approach is often lengthy and expensive. Furthermore, success is not guaranteed, as qualified employees need to be found, and developing technologies in-house requires long development cycles not to speak of the complexities that are often underestimated.
Accepting outside help: Accepting the help from experienced companies and collaborating with a professional partner, who has the needed knowledge about technologies and processes is usually the best way to close that “gap” quickly.

We at Applicata, can support you in the areas technology, processes and expertise. Our goal is it to decisively help our customers closing their strategic growth gap.

Technology: As a Software-As-a-Service company Applicata offers an integrated marketing controlling solution for central planning, controlling and optimization of every marketing activity. With Applicata you centrally manage all your marketing activities for every website, in every country and for every marketing channel.
Processes: Clients employ the Applicata software as their centralized campaign management for every marketing channel based on a comprehensive aggregation, consolidation and transformation of all relevant data. Further, Applicata facilitates full cost control for all online marketing expenses through automated cost calculations and cost analyses.
Know-How: More than 20 years of work experience in the areas of Business Intelligence, Online Marketing, Data Science and E-Commerce and thousands of developments hours have been combined in the Applicata software. Additionally, we assist our clients in an advisory capacity with a dedicated project manager who also supports the technological implementation and user training.

Our Mission: Democratize Online Marketing

The enormous opportunities which the shift online provides should not be limited to the Big Guys. Applicata’s goal is to democratize online marketing: Small- and mid-sized companies are supported by technology and expertise in business intelligence and online marketing, so that they assert themselves against the Big Guys.