Simple analytics is the best kind of analytics

"Make everything as simple as possible, but not simpler." -- Albert Einstein

Due to the nature of job, I get to have three measurement development and five measurement explanation conversations a week. Thus, it is topic near and dear to my heart. So dear, I sometimes want shoot myself rather than having another conversation about it. Here are my suggestions on how to build an easier road to measurement.

1. Concentrate on the bottom line. Did you make money or lose money? Did you improve overall sales or not? Did you improve overall churn? If you are not using control groups, concentrate on overall numbers. Granted it is much easier to show a stellar performance in one group of customers, but it is usually a false assessment due to self selection. If you have not moved the overall needle, you have not moved the needle. Overall revenue change is good. Overall revenue change year over year is even better. Revenue for a category or a certain selected sub-group of customers may be misleading.

2. Use control groups, if you can. Control groups are the great equalizer of metrics. It's the only panacea against a poorly designed measurement. Let's face it, shit happens, and metrics don't always work out the way we want them. Yet, if you measure it against a matched control group, even the worst metric will usually point you in the right direction.

3. Resist going into the weeds. Weeds require careful use of judgment, otherwise, they will turn into the hell of 100,000 numbers.You all know the drill, after the first look at the report, the executive asks, "and how about we look at those measures by cutting them by X... and Y, and of course, Z". Depending on how many categories are in XYZ, your total numbers in the report all of a sudden explode into a incomprehensible mess. So, this is where the analyst must go into the best diplomatic dance they can manage, saying that of course, we will look and see how that turns out, and surely report back. That's your chance to look at the weeds and see which ones are worth going into. If you see real insight that sheds light on the question at hand, the cut is worth reporting on. If it is just another iteration of the same numbers, simply cut into smaller pieces, then stay away.

It is my firm belief that a report should contain the least amount of data it needs to provide insight, and more data clog your understanding of the picture just as well as too much clothes clog up your clothes, so be ruthless with the stuff that does not add to the understanding. It may lead people on the wrong path, too.

Want instant results? Concentrate on improving the worst performers.

"He who joyfully marches to music in rank and file has already earned my contempt. He has been given a large brain by mistake, since for him the spinal cord would suffice." -- Albert Einstein

Concentrating on the worst performers can be particularly fruitful in a well-managed organization, where performance is distributed in a close to random manner.

Mind you, we are not talking real improvements here. We are talking about putting yourself in a situation where there is nothing, but the upside.

Here is how you can spot the right type of the "worst" performers. They are usually smaller in size compared to an average performer. Whether it is smaller regions or smaller segments, groups of smaller sample size tend to have a higher variance, and thus, a higher probability to be an outlier, including the "worst" kind. You also need to make sure there are no systemic factors that drive poor performance, or otherwise simple random nature of the world may not be able to compensate for the systemic factor. That means you will have to actually do something to improve performance of your "worst" group. So, check your averages over several time periods to confirm that your worst performers had a particularly hard time when you pick them.

After you have validated the random (or even semi-random) nature of your "worst" performance group, you can crate a project to improve how it is doing. You would not expect your "worst" performer group to stay exactly the same every period, would you? If so, there are pretty good chances that next period you will "pull" a good number of the worst performers closer to the average, or out of the "worst" group. Congratulation, you just got yourself a "real" quantifiable result!

Remember, there is always a bottom 5% to work on!

When comparing, make sure the groups are representative

Sometimes people call them "matched", which is a layman's term for representative. So, why do they have to be matched? Because having non-representative groups may be so misleading, your analysis result may be the opposite of what they should be.

Here is a quick example. Let's say you have two groups of customers, each one of them consists of customers of two types/segments. Sometimes you may not even be aware that there two types of customers in your groups. Let's assume those segments exhibit different behavior. The sample behavior I chose was Churn, but it may be anything. Let's say we applied some sort of treatment to Group #2, and their churn went down by 1% in both segments. We are trying to use Group #1 to establish a baseline (or, what would have happened to the best of our knowledge) to Group #2 if we had not had the treatment. However, because the composition of groups is not representative of each other, we get exactly opposite result for the total - Group #2 appears to have a higher, not lower churn. See table below.

												Group 1	Group 2	Difference
					Segment #1							1,000	5,000
					Seg #1 Churn							5.0%	4.0%	-1.0%
					Segment #2							5,000	1,000
					Seg #2 Churn							2.0%	1.0%	-1.0%
					Total							6,000	6,000
					Total Churn							2.5%	3.5%	+1.0%

Scientific Principles of Direct Marketing Optimization

Here is the list of my principles so far:

1. Always use a control group. Preferably randomized, representative (of your treatment) control group takes care of other things going on in the marketplace, including your own campaigns, and also acts as the “great equalizer”, fixing even the worst metrics, response models.
2. Maximize lift, not response. Lift is the difference between treated and control groups. That’s what you are trying to impact.
3. Optimal frequency is often more powerful/important than optimal segmentation. Ideally, you want to optimize (i.e. maximize lift) frequency by segment, but if you are confused where to start testing, you should start with frequency. None of the segmentation work will be insightful unless your frequency is within the shooting range of the optimal.
4. Test, test, test. It’s one of the easiest and simplest ways to learn.
5. When testing, have a hypothesis, then design the test around it. Sending a customized piece to a segment is a great idea, until you realize that you did not send your regular piece to the same audience at the same time, and thus can’t tell whether customized piece would have done better than a regular one.
6. Track your treated group against control group for a while to understand how long the impact of your mailing lasts. Some people want to use LTV. That’s because they want a higher ROI. True measurable difference traceable to the impact of a direct mail piece rarely lasts more than a few months, even though average lifetime maybe measured in years.
7. When choosing the size of the control group, you first need to understand what kind of a difference will justify the effort (i.e. break even lift), and then determine a sample size that will make this difference statistically significant. If you’re measuring with a yardstick, it’s hard to determine a half-inch of a difference.

Marketing analytics case study - Direct Mail list cleanup

"I think and think for months and years. Ninety-nine times, the conclusion is false. The hundredth time I am right." -- Albert Einstein

Just in time for my posts on measurement against a control group, I got a perfect real-life case at work. The situation is pretty typical for many people who run large direct mail lists out of a corporate system. The system has addresses of your current customers as well as prospects, and after you apply your targeting criteria, you can use a random selection procedure to identify your control, and make a record of both mail and control addresses. In the last step, the system produces your mail list to be sent to the mail house. For the measurement, customer purchases are tracked back to the addresses that were recorded in the mail and control groups, and the count and revenue of mail group and control groups are compared to determine incremental purchases and revenue.

The mail house does all sorts of address hygiene and cleaning, like removing duplicate addresses, taking out vacancies, running the addresses against known address database by USPS, which both cleans out non-compliant and nonexistent addresses. While current customer lists usually yield a very high percentage of mailable addresses, prospect lists lose around 20%-25% of the addresses in the hygiene process. This presents an issue for tracking, because we are tracking the purchases back to the lists that do not accurately reflect the addresses that were actually mailed. To improve measurement of the direct mail performance, the IT system proposes a solution that can take the post clean-up mail list (to be received from the mailhouse), and use it to clean up the original mail group list.

Will this solution improve quality of measurement? What are the advantages and shortcomings of this solution?

(I will pulish my opinion as a comment to the post)

Maximizing response often leads to poor campaign performance

I did some research for presentation at work today, and found this very nice white paper on the use of lift (as they call it, "uplift") modeling in driving true incremental sales. It correctly highlights the difference between correlation and causation, as response models simply correlate to propensity to buy, and incremental lift models track impact of marketing communication. Then it goes to explain the impact of segmentation on response and incremental sales, and I just loved those two charts showing how response is correlated to lift. Negatively, in their particular case. The higher the response, the lower the incremental sales. Actually, that's the conclusion that I often found in my own job. I am not saying it always happens, but it does happen often when we maximize response and focus solely on those who are likely to buy from us anyway. You should also watch the opposite end of the curve, where you have prospects so unlikely to purchase, that even though you do get high incrementality, it may still not be enough to pay for the program. Thus, your most profitable targets are usually in the sweet spot somewhere in the middle of the response curve. This is kind of article every direct marketer needs to read.
Generating Incremental Sales

Actually, there is no exception.

After I published my previous post on the use of control groups, I did a google search on the use of control groups, and came up with the following quote:

The cardinal rule of direct marketing is to include a control group. Without it, you will never know whether customers purchased your product because of this marketing effort, or because of the billboard ad, the radio spot, a friend’s suggestion, an in-store brochure, or because Elvis told them to. There is one exception. If you have an air-tight fulfillment set up, whereby the customer can only purchase the product through your channel, e.g. a special 800#, then you don’t need to hold out a sample; you can be certain that every sale came from your effort (except the referrals from Elvis).

The conclusion is incorrect. I have seen more campaigns than I care to count on all of my fingers that got a ton of calls to the 1-800 number, but no incremental sales whatsoever. Zero. Zilch. Ноль.

Sales that come to the 1-800 number is something that I like to call "associated sales", i.e. sales that came from the target audience and somehow "associated" with the communication, but they are is not the same as incremental sales. Your mail piece may be very good an convincing potential customers who would make a purchase anyway to call a particular phone number, but that's no proof they would not have called if not for the DM piece. They would have called alright (that's what the control group is for!), just called a different number.

I don't like the 1-800 phone number salesmen much. Oh, well, comes with the territory (and I do believe in Elvis referrals).

That's what control groups are for

Gary Loveman famously said that there three ways to get fired from Harrah's: steal from the company, harass women, and not use control groups in testing. He is correct, particularly, in cases when we are trying to properly measure the effectiveness of marketing communications for a fairly popular consumer product.

What is a control group? In most cases, control group (sometimes called a hold out group) is a group that does not receive the communication we measure. It is used to assess the effectiveness of this particular piece of communication. By effectiveness I mean the impact of the communication on the test group that is not observed in the control group. Therefore, it is important to have a control group that behaves in exactly the same manner as the test group, a condition that is generally called being representative.

It is not always possible to pick out a perfectly representative control group, but we should always do our best to try. Often, control group is one of the few reliable and easy ways to truly assess incremental impact of your marketing communications.

Here are a few practical implications of the use of the control group that are worth mentioning.

• Often, companies use multiple marketing communications to reach out to the customer, and then try to untangle how many sales were driven by each type of communication. When we send out a direct mail piece and put advertising on TV at the same time, it is hard to determine how many of the people on the direct mail list who purchased your product were truly driven by the mail.
  That's what the control group is for. Compared to other ways of measuring the impact (separate 1-800 numbers, sales funnel, and so on) measurement against control group looks at the true incremental sales from a marketing vehicle, as control group shows how many sales we get from everything else (TV, radio, web, spontaneous) except for the DM piece.
• The concept of "what would have happened" is the cornerstone of any effectiveness measurement. It is relatively easy to determine "what happened" - how many additional products we sold, how much revenue we got, but it is not always easy to determine what would have happened have we decided to save some money and not have the communication. The "would have happened" estimate is usually... an estimate, which is a number with standard error (or degree of uncertainty) attached to it. This is why all of the estimates of the impact have to be statistically tested.


• Sometimes the marketer is able to estimate the "associated" sales from a marketing vehicle pretty well - those who call 1-800 number, those who click on the online ad, and so on, and the use of control groups is deemed excessive.
  In this case, we assume that 100% of associated sales can be attributed to the marketing vehicle, and no other sales are being influenced by the marketing vehicle. It may be a good way to assess effectiveness in cases when the likelihood of a potential customer to call you spontaneously is low. For example, if you are a small consulting company sending out a brochure, chances are that the call on your number from a recipient of the brochure  was driven by the mail.
  However, if you are a consumer company with a high rate of unsolicited walk-ins/call-ins, the situation may be very different. If your DM piece yielded 2% call rate, and you expect a 1.5% spontaneous call rate for the same measurement period of time from the same target population, all of a sudden your ROI on marketing communication does not look as attractive.


• Many marketers are confused by the use of control groups when they have multiple overlapping marketing campaigns. Some suggest that no clean measurement can be achieved unless we exclude the same group of targets/controls from all other campaigns.
  This is not true. Again, this is what control groups are for - to control for overlapping campaigns. As long as we exclude the control from the particular communication we are measuring, the results are valid.
  For example, if we have a marketing campaign consisting of 3 consecutive letters, we can employ a different random control group to measure effectiveness of each part of the campaign (by "different" I mean "separately selected", which probably mean that some of the control targets will overlap - again, no big deal). Suppressing the same group of customers from all 3 pieces will give you an estimate of the effectiveness of the 3 pieces together. Suppressing a control group only from the last mailing will give you an estimate of the effectiveness of this last piece (i.e. is a two-letter campaign less effective, and if it is, by how much).


• Building on the previous argument, it is not necessary to create the unified control group if you have several DM campaigns in the market. For example, you have two campaigns to a similar/overlapping target with response windows that also overlap. Inevitably, you will have targets that received two pieces of communication, and purchased your product, but what campaign drove the results? In this case, the best way to measure is to have two random control groups, one for each particular campaign, so we can measure effectiveness of each campaign against its control group. The point of contention is usually that the targets in the control group for the second campaign received the mail piece of the first campaign. However, this does not muddy up the measurement of the second campaign because the groups are still representative of each other, as the same percentage of the test and control group received the first communication.
  If there is no difference between response rates the test and control group for the second mail piece, it is not because the control group received the first piece, it is simply because sending the second piece did not make any difference - exactly what we were trying to determine by having a control group. Having the same control group for both campaigns will not help you determine the effect of each campaign separately, but rather the impact of two campaign together.


• What if selecting a representative control group is next to impossible? In this case, the marketer should try to employ all available methods to understand what would have happened if the marketing communication did not happen. One of the ways is to use an imperfect control group that is reasonably representative of the test group, and adjust for the differences based on customer attributes and behavior in the period before the test.


• Sometimes the language of control groups appears in what I would call "A vs B" test. This type of test is used when two different marketing communications (A and B) are tested on representative [of each other] audiences. In some cases, one of the groups is called a control group. Personally, I don't have an issue with naming as long as the marketers understand that the test results are limited to the comparison only, i.e. they only give information about relative effectiveness of the methods A and B, and not absolute effectiveness. Absolute effectiveness needs to be measured against a real control, which does not receive the marketing communication we are measuring.


• Precision of the estimate is another consideration of testing, and it is usually a function of the size of the groups, and how representative of each other they are. There are a lot of calculators out there that help one estimate the confidence interval of measurement depending on the sample size. Two very large near-perfectly representative groups (think of a mass mailing, randomly split into test and control groups) may give extraordinarily precision of measurement, in my practice, up to 0.1%. Further precision is usually limited by either size of the sample, or the sampling methodology, which is not always the purest of random. Though often we assume random splits, the machine generated pseudo-random distribution do have a threshold of "randomness", which can become noticeable in some high sample size measurement, usually, over 100K trackable targets in the smallest group. Another consideration for precision is related to the break-even point for marketing communications. For example, if your break-even lift is 1%, it would not be very practical to measure with a 5% precision

I have written more posts on the use of control groups on my personal web page: http://zyabkina.com/thoughts.html

Knowledge is only power when you know what to do with it

"Strive not to be a success, but rather to be of value" -- Albert Einstein

Not that long ago I was pitched some predictive analytics project that was promising (according to the vendor) to solve many of my problems. Or, in their words, "just imagine all of the things you could do if you knew that this person is more likely to buy your services than that person". That's usually when the thinking stops and the dreaming begins. However, back on the ground, the question remains - given that knowledge, what exactly do you think you should do, and how do you know that this will be more efficient than what you are already doing?

The whole concept of "doing something" in marketing assumes that 1) your action will change behavior (analysts usually compare to a control group to assess if the behavior changed) and 2) the benefit from change is large enough to pay for the action you have taken. Often, both of those things are assumed to be true, and the action is taken. However, our curious analytical minds cannot take anything for granted, so let's just list some thoughts on why this type of knowledge may turn out a lot less useful when we start executing on it.

• It is not clear that the behavior can be changed. For example, if you know that someone is likely to disconnect your services (stop purchasing your product, stop paying on the mortgage you are holding) because they lost their job and can no longer afford it, then there is really little you can do to make them keep the services - or, at least, do it in a way that is profitable to you.
• It is not clear that the behavior needs to be changed. If someone is likely to buy your product, maybe they will - in quantities large enough that you can't improve with your communication. If someone shops at your store every two weeks, provinging a discount often only leads to giving away discount on the purchase that would have happened anyway.
• It is not clear that you can change the behavior with your action. This is related to the previous point stating that there may not be enough change in the behavior for the action you have chosen. This means that you may have to test a variety of actions, which often makes the knowledge you have obtained from the predictive research less and less relevalnt.
• The research does not give you much clue on who you want to target. That's when your vendor is going to throw a fit - of course it does, that's the whole purpose of the exercise! Hold your horses, though. So, if one person is more likely to buy your product, why does it mean that this person is more likely to change their behavior and buy your product after receiving a direct mail piece than the other person? From my experience in measurement based on recency, those who have bought the product most recently, are much more likely to buy again, in fact, so likely, that it makes little sense to send them a coupon. It is the other group - people who have bought before, but have not bought in a while that show most change in behavior when sent a coupon. The change is measured as a lift over control group, not as overal response rate. What that says is that if you know that person A is more likely to buy than person B, person B may turn out to be a more profitable target. Combined with the previous point - after all that money spent on predictive research, you still don't know what action to take, and whom to target with it!
• The research does not give you any information on whether your action is a cost effective way to act on the knowledge. We are again measuring our action against status quo, and looking for a lift in revenue that makes our efforts worthy.
• It is not clear that you should change your approach to the market. Assuming you have done some prior in-market testing and measurement, and figured out how to segment your market in a way that appears to makes sense based on responses to your communication, it is not clear at all that the additional predictive knowledge is going to help you optimize your marketing. It is nice to know that someone is likely to purchase or cancel your services, however, it does not necessarily ensure a change in strategy. If you know that a certain group of targets needs to be mailed every X month for optimal response, you don't really care that it is because they are more likely to purchase the product - or because they are less likely to. All that matters is that your mailing has been tested and optimized for efficiency.
• It is possible that your optimal go to market strategy is independent of the segment. That actually happens to good strategies - they let the customers to reasonably self-select, and they offer solutions optimized to serve certain needs. Customizing them on an individual basis is not going to move the needle much, but efficiencies will be lost.

The conclusion is that although the knowledge is a good thing, it is not always possible to use knowledge to improve business results. Correct testing, measurment and execution are generally more important for marketing optimization than having predictive knowledge.

How to create a great analytical report

"Joy in looking and comprehending is nature's most beautiful gift" -- Albert Einstein

How many times have you been thinking/told that "we need to understand A", and automatically assumed than this means "we need a report on A"? After this conclusion, things usually get into gear - people get together to come up with metrics, they task analytical (code word for "data puller") or IT people to come up with the number, and eventually put it in a nice regular email report. Sometimes things work out, but sometimes the report becomes just one of those efforts that are never used afterwards. In my particular place of work, not only the process spits out something ugly and often completely unuseful, it also takes a Herculean effort wasted on it. The end result is usually hailed a great success, and one of those days you get an email stating that the great new report you have been asking for (no , that was not me) has been created and now published, but we can't send it over email because it is more than 10Mb zipped, so go pull it yourself. Oh, by the way, this report does not include some of the data because we could not trace it properly in the set up we had created, so, it is pretty much not useful, anyway.

How do you avoid this situation from happening? Here are some of my thoughts.

1. Find out what the true question is.The assumptions about what should be in the report most often come from two camps - the executives and the data pullers. Whenever executive asks for a report that is too specific, like "shows percentage of customers who's discount expires next month", beware. Chances are that what the executive think will answer the question is not what will answer it in the best way, and often, it will not answer the question at all. My personal take on that is to reframe the inquiry, and simply go back to the root - ask the executives about question they are trying to answer. Most times, you will find out that the answer lies in totally different cut of data that was initially assumed. The second camp of people that I have encountered, are data people, particularly, IT people in the organization I am currently working for (was not the case in my other jobs, so I have to make a caveat for them). For some reason, they tend to skip all of the initial exploration steps and jump to a conclusion about what kind of data will answer the question without much regard to the question itself. Sometimes it is not their fault, "they are just doing their jobs", but have yet to see a great report built upon their assumptions.
2. Research. Can't stress it any more since this is the most common error made in the process, especially, if you are creating something new and not particularly well understood. Before you create a report, you must know what measures to put in it. Sometimes the measures are pretty simple, and sometimes they are not - there is a million ways to slice and dice the data, so if you determined to spend your company's time and money on creating the report, it will pay a hundred-fold to come up with the best slice/dicing technique. A good deep dive research project should have the following properties: 1) it should explain how things work - i.e. what impacts what in that particular area, and by how much; 2) it should compare several metrics for the same process and look at them from different angles - by store/franchise/DMA/division/region, by day/week/month/year, by product type, month of month/year over year, and so on; 3) ideally, it should have that best cut that you just lift from the presentation into the report and feel confident that tracking this measure(s) will tell you all you need to know about the issue going forward in the most efficient manner, meaning, with the least number of measures possible.
3. Revisit your decision about regular report. Review your research project with peers and executives and decide if creating a structured, regularly updated report is truly needed. Even though it seems not plausible, but understanding of most business processes does not require a regular report. Remember, the conclusion that "we need a report" was just a conclusion, and may have been a wrong one. A deep dive research project may be able to answer most if not all questions, and thus the regular report is not needed. The decision may be to refresh certain parts of the deep dive at some later time, but not to turn it into a regular thing. There may be other reasons not to create a report, including: 1) the data quality is not good; 2) you have not been able to answer the question any better than existing reports; 3) the data is too stable or too volatile, and tracking it will not be insightful (will it do you any good to know that 20% of your orders come from type A customers every month, and the number never budges even a little?); 4) there is insight in the research, but not enough to warrant regular reporting. Remember, a weekly report is 52 times the work of an annual report, and a daily report is 5 to 7 times work of a weekly report. Too many regular reports are not going to promote learning but rather clutter the mailboxes, so be selective about reports that are produced on a regular basis.
4. Listen to the data - it has the mind of its own. When you finally lift that chart that you want to recreate in a regular report, you have to evaluate it for appropriateness for regular reporting. First question is how hard it is to pull. Sometimes, the very best and meaningful cut of the data is 10 times harder to pull than a cut that is just a hair lower in quality. Multiply the difference in difficulty by the frequency of the report, and see if it makes sense to go for the harder to get number. Second consideration is the amount of maintenance the report will require. What can be pulled for a deep dive not always can be turned into a daily email without daily maintenance of the code. Any regular data pulls must be very stable, i.e. not impacted by customary changes in the information or operational systems. The other side of the maintenance consideration is how much you can automate the report, which should be tied to the frequency. Daily reports must be "set it and forget it" automated. Monthly report may have some pasting and copying in them.
5. Put metrics in context. One of the biggest mistakes I see made over and over is forgetting about proper setting of the metric. Let's say your metric is total sales by region. Now, how do you know if those sales are good or bad - the regions may be different size and have different sales trends or inherent idiosyncrasies, so comparing them is not always meaningful. You may compare to the previous time period, but what if your business is seasonal? That's where we usually get to the year over year comparison. Now let's say your sales this month are 20% down compared to the sales a year ago (automakers in 2008-2009 are a good example), that must be bad - but not until you see that in the previous months they were 30% down. Proper trending is one of the most important settings in which you should show your metrics. The regular report should be able to tell you if the results are good or bad, otherwise, it is not very meaningful, and nothing can put the metrics in perspective like trending. This also impacts the execution of the report, because it is one thing to pull the data for one month, and quite another to pull it for 15 or 24 months. In an ideal situation, your timeframe and properties of the metric were well defined during the research stage.
6. Now, finally, it is the time to build and execute the report. First, comes the format. I have always maintained that a pretty chart works magic - so, do use pretty charts. Second, think about the report delivery, distribution list, putting it out on the web-site and all that pleasant stuff. Your analytical part is now over, but polishing your splendid work and delivering it correctly makes a cherry on a sundae. You are working in marketing, after all. Good luck!

In defense of the big picture

"Confusion of goals and perfection of means seems, in my opinion, to characterize our age" -- Albert Einstein

Someone needs to defend the wisdom of looking at the big picture, so I am going to do just that. How many times do people want to look at the forest, but start looking at trees, then at the leaves of the trees, then at the veins on the leaves? The problem is that while leaves and veins may be fascinating, the forest may be shrinking while you are looking at them, maybe even due to logging. Well, hope, not that severe.

My analysis du jour was looking at a very clever and nicely sampled test that I had devised several months ago. The test has not survived the latest iteration of never ending organizational change, and had to be prematurely ended after a few months in the market. I decided to take a closer look at the results anyway - testing, but never analyzing/making conclusions is one of my pet peeves.

In the test, the target customer universe is randomly split into several groups, and each one of them is delivered a certain dose of our marketing poison (kidding, it's of course marketing manna). Basically, full dose, half-dose, and quarter dose. A few months later, I am looking at the results to understand what happened. What we really want to look at first, is whether consumer sales grew during that period of time - and by how much/how long, not the details of how it grew. That's because at the end of the day, if you are not growing your subscriber/product/sales base, and get more money out of it than you are putting in, nothing else matters. Obviously, the first question I get, is how the subscriber base grew - was it increase in connects, was it drop in disconnects, or a combination of those - because anyone in marketing automatically thinks that they only need to care about connects. Well, plainly speaking, that's wrong. Higher connects usually lead to higher disconnects as certain (and actually surprisingly high) percentage of customers are going to disconnect within the first month or two from the connect. Those disconnects are a direct result of the connects you are driving, and it would be incorrect to count all connects in. On the other side, if higher marketing dose results in lower churn, I will still take it - I really don't care why applying marketing reduces churn, what I care is being able to experimentally confirm that it does and by how much.

Now, I should admit that knowing a certain amount of detail may help you chisel some helpful insight, however, many times it is hard to nip the tendency to evaluate the end result of a program based on that detail. If the bottomline question about a program is whether it worked (aka paid for itself), then this conclusion should be drawn from the bottomline, most "big picture" number. In our particular case, after all the connects, disconnects, upgrades, downgrades, and all sorts of other moves, what difference we are left with, and for how long. The "what" comes first. For how long comes second, and let's not kid ourselves, that "how long" is usually not the lifetime value. LTV and it's [mis]use for campaign evaluation is a totally different topic, which I hope to write about pretty soon.