Maximizing ROI Through Digital Insights
Maximizing ROI Through Digital Insights
I'll take three big datas, please.
As researchers we are always trying to jump into people’s minds — the minds of clients, competitors, and consumers. Why do we do this? Probably the same reason you do: to guide decision making. There is no place we all want to see more than the mind of the digital consumer.
We don’t see a single industry out there that’s not affected by the rapidly changing digital landscape, and this means huge shifts in investment are going to be a necessity.
However, the focal points of digital investment are not the same for each industry. In fact, they are often different for each brand within an industry. So how do we know which decisions to make? This is where data comes in — big data, perhaps a focus group or two. Before thinking in terms of products, we need to ask ourselves: do we know how our customers actually use digital? What do they respond to? How do we reach them?
Throughout this article we will take you through a new approach to consumer profiling based on digital behavior that we believe can answer all of these questions.
Beginning with the pain points of traditional digital research, we will show you how to bring context to your data and uncover insights that can directly inform the decisions you must make as a brand and as a business.
Some of you may feel you already have data on your consumers’ digital behavior, but what we often see at MADJOR is a lot more guesswork being done than science. What may look like good data starts showing holes once decision making needs to be applied. We see two common problems that lead to these holes: data either being overly general or overly specific.
General: WeChat has over 700 million active users.
How many times have your heard this statistic referenced when contemplating a new service or campaign on WeChat? We are naturally attracted to such large, impressive numbers, but what do they mean for your brand and business? Clearly not all 700 million of those users are your target audience, and probably not all of them are using WeChat in the same way. Despite having little to no value for real decision-making, it’s “insights” like these that we see constantly being pushed by digital agencies. We need to take a step deeper and find a number that may be a bit smaller, but will be a whole lot more meaningful.
Specific: Our website's conversion rate is 1.5%.
Here we have a data point that is very useful and is certainly a powerful tool when it comes to tactical UX adjustment. However it is also inherently limited when it comes to decision making as it operates in a black box, considering only those consumers who have made it to your website and what they do once they are on it. But what do they do when they are not on your website? Who are the 1.5% choosing to follow through with the purchase? What happened to the other 98.5%? What pain points did they encounter to interrupt their journey? This is a situation where we need to take a step back and look at what brought us to this number.
Whether we are going deeper or stepping back, our goal is to find consumer data that is specific to your target audience and is analyzed within a framework that enables decision making — at MADJOR, we believe this framework must be based on digital behaviors. Behavior, however, is not just what digital acts we take, but also where, when and how we take them — what we can refer to as “context”. We can then use context to give us the “why”. This is what brand and business decisions are based on.
We can use the selfie as an example of digital behavior.
1. We start with a representative digital act: using a phone to take pictures. There is no context; we have data but it doesn’t actually tell us much since probably 90% of one’s target audience “takes pictures with their phones.” So we can dig a little deeper.
2. Adding a bit of context: using my phone to take pictures of myself. Now we have reached the selfie level, better than before — but we can keep going.
3. Adding another layer of context, we can now see that the idea of “selfie” is in no way homogeneous: using my phone to take pictures of myself with friends, pictures of myself that are heavily edited, pictures of myself that are natural, pictures of myself in front of the mirror.
4. And we will take it one step further: sharing my pictures on WeChat Moments, in closed WeChat groups, on Weibo, etc.
By asking the where, when, and how, we have gone from a digital act (taking a picture with my phone) to a digital behavior (sharing a selfie on WeChat Moments that I took on a night out with friends). When applied to your target audience, data can become relevant again.
Digital Profile / Digital Behavior Analysis
Once the digital behavioral data is collected, a model of analysis is needed to process it into something understandable across all stakeholders of the brand and business. It is common to see agencies or marketers try to go straight from abstract data to decision making, but we find this to be a risky approach. Instead, our approach to digital behavior analysis begins at the data collection stage and continues to persona segmentation and then final strategic recommendations.
Inspired by Maslow’s Hierarchy of Needs, our approach is rooted in human psychology and behavioral thinking. While the digital tools that exist now were not around during the time of Maslow, we see the extension of his “fundamental human needs” into the digital space as a natural course of action considering the wealth of human development that now takes place online. Therefore, using both a quantitative survey and qualitative observation, we evaluate four of these fundamental psychological drivers to shed light on who your target audience is in a digital context.
To build an online persona typology around these four dimensions, we assign 3 unique factors to each, inspired by the Sixteen Personality Factors from Psychologist R. B. Cattell. Through iteration and refinement from previous behavioral research, we have narrowed down to 12 "digitally relevant" factors that allow us to accurately measure the multiple aspects of a consumer’s digital profile, ranging from impulsiveness to creativity. Taken separately they can inform specific digital actions a consumer may take towards a brand or business; taken together they can show patterns of behavior that reveal their psychological drivers and online persona.
Questions in the quantitative survey will look at their typical digital behaviors, purposes of using digital, and context-specific digital actions that directly link back to the 12 criteria and 4 psychological drivers. Once graded, each respondent will be assigned a high or low score in each of the 4 drivers, and these permutations will represent 16 possible “digital personas”.
We can then apply this to your target audience and identify the top personas within. This initial digital segmentation is crucial when making decisions regarding one’s digital investment and content targeting. Given the top personas, we then will add more context to their profiles, taking representative consumers and conducting qualitative observation within the context of consumer lifestyles to paint a finer picture of digital behaviors. To best observe natural interactions, we use small body-cameras to conduct life-logging photo and video observations followed by interviews with each of our participants. All of this data, including the photo and video content, are used to construct our final profiles.
Digital Decision Making
When using an analytical model based on specific behaviors, it is a common but critical mistake to become too absorbed in the process and forget the strategic decisions the insights are supposed to inform. Making sure each step of the process has a direct link back to key brand and business decisions helps avoid such a situation. Let’s take 3 examples of decisions that typically keep people up at night and show how our data can help:
1. What Channels Should I Be Present on?
While digital strategy goes far beyond just being present on the right channels, we often see mistakes being made at this initial step. Brands assume they need to be on the standard list of WeChat, Weibo, Facebook, Twitter, while discrediting other newer or smaller platforms as unprofitable or unsustainable. Based on the data most brands are using, such an approach is understandable — who can argue with over 1 billion daily active users on Facebook? However as we have seen, big numbers can be misleading, and they often hide an even more important number: engagement.
Working from our digital behavior model, we can pinpoint which channels your target audience is on, and which platform they are active on — a crucial difference. In particular, we can look at your largest and most active persona segments, where strong use of a more niche platform could justify greater investment. In the same vain, if you were to find that a platform where you are currently investing shows little attraction or interaction from your key audience, a decision can be made to recoup that investment and transfer it elsewhere.
2. What Online Content Should I Be Producing?
Be it on social media, forums, or your brand-owned channels, understanding how to best reach and activate your audience is critical. By breaking your audience down into personas, and understanding how they view and interact with digital outside of your brand space, it is that much easier for you to tailor unique content that speaks to your different personas, as well as to avoid conversations whose impact is low. By analyzing types of content by platform and filtering down based on what your target audience engages with, it becomes much easier to align your messaging with the natural behaviors of each particular platform. Different audiences are driven to use platforms for different reasons, be it social, informational, or creative; these differences are important for a brand to understand. By aligning the insertion of your brand with the natural points of interaction, you can drastically improve esteem and engagement.
3. How Do I Target My Different Audiences?
Digital behavior segmentation is key to guiding media investment. Usually media buy is set using general criteria around your target audience: age, gender, location, related interests, etc. In fact these are the same criteria we use when screening respondents for our research. What becomes immediately clear, however, is that within this target group you actually have a huge variety of habits, drivers, and behaviors, which have a huge impact on how they will respond to your ads.
By looking at the fundamental psychological drivers and grouping our personas as such, we can determine who in your target audience will respond to what type of media push. It also allows us to identify those many disparate personas who do not make up a large portion of your audience, and for whom you can shift media investment away from. With the right data you can both trim the fat and sweeten the offering in your media buy, a rare instance of both cost saving and revenue generation.
4. How Do I Activate My Highest Potential Consumers?
One of the major benefits of ranking your consumers along our four psychological drivers is that we can gain a much clearer picture of who your existing and potential influencers are. Those consumers who show a high score in Actualization and Connection are a natural fit to lead conversation and interaction around your brand. Along the same lines, those consumers who show strong scores in Connection and Discovery are less likely to be leaders within your digital space, but will make up the majority of your active community, hoping to learn and share experiences.
Understanding the dynamic between your different personas, how they interact with each other online, and influence each other’s decision making can radically change the digital strategy of a brand. Once the potential of otherwise silent consumers is identified, they can be empowered as influencers for your brand. Branded communities built not on incentives but on mutual interaction and shared values may be the apex of such consumer data-based decision making.
Insights in Action: The Digital Personas of MADJOR and Labbrand
Digital personas are a great asset to have, and as we have seen can help inform a lot of decision making. However, it’s too often that they quickly find themselves forgotten and unused in the depths of the company server.
At MADJOR, we put just as much emphasis on how the insights are presented, using the most impactful formats to hold on to the story and your attention. For digital personas, this means creating physical Digital ID Cards that could be framed on the wall of an office and always kept in mind when making decisions.
To give you a taste of our research and the format it takes, we tested out our methodology on our ever-willing colleagues here at MADJOR and Labbrand. Out of 56 respondents surveyed, we identified four key personas:
- The Explorer (20% of total respondents);
- The Dreamer (14% of total respondents);
- The Path Finder (14% of total respondents);
- The Master (14% of total respondents);
We then conducted life-logging observation and in-depth interviews with a representative from each persona. Unsurprisingly, we found our colleagues to be quite the savvy digital users, with only 7% ranked low across all four psychological drivers. Discovery was also the most commonly identified psychological driver, which too makes sense considering the young average age of the Labbrandian.
On the next few pages you will find example Digital ID Cards based on the top four personas that make up MADJOR and Labbrand.