Analysing the Analytical: How Does Internet Giant Google Analyse their own Marketing?

google under mag glass

Google is a household name. The word google has even made its way into our everyday vernacular with “just google it” being the answer to almost everything and you will be sure to find some kind of answer there. So how does a multi-gazillion dollar company like Google evaluate its own marketing to become such a successful entity that it is today? Could it be a case of practice what you preach? And how effective is it?

Google advertising

Yes, you may not think so but Google do advertise. You might think that a company like Google does not need to advertise itself but it does. With competition like Microsoft and Yahoo hungry for consumer attention, Google need to stay on top of their game. In fact, Google is reputed to spend about $4 billion on advertising per year. Here is one of their online advertising campaigns featuring multiple products called “Dear Sophie”. Warning: If you are a parent like me, have a few tissues ready.

In India, Google apparently has 97% market share and yet here is a 3.32 minute long ad promoting Google’s “search” function.

And there are many more. But I won’t bore with more of Googles long winded ads which they claim to be much better for changing a consumer’s mind and for brand recall. So, why does Google need to advertise itself in a market where it dominates? Is it to stay on top? Is it to continue to dominate and stave off the competition from Bing or Yahoo?

Although Google tries to convince most of its clients to spend their advertising dollars on online advertising, Google themselves advertise on TV.

Source: Kantar Media

Source: Kantar Media

It is obviously a strategy of trying to gain new customers who are not online since they dominate the online world already so why advertise to people who already buy into your product, right?

So how does Google measure or evaluate its own marketing? Which marketing metrics do they use to assess their marketing performance? Ambler and Roberts (2008, p. 745) discuss the notion of not settling for a “silver metric” and that multiple metrics need to be considered in order to assess marketing performance. Hence, we can safely assume that a large and very successful company like Google would definitely consider every metric available considering they have access to very, very, and I mean huge amounts of big data. Google operates nearly everything through big data, even right down to how they hire their staff. The following video shows just how big Google is.

“If you can’t measure and quantify it, how can you hope to start working on a solution?” said Bill Maris, managing partner of Google Ventures. “We have access to the world’s largest data sets you can imagine, our cloud computer infrastructure is the biggest ever. It would be foolish to just go out and make gut investments.”

“If you can’t measure and quantify it, how can you hope to start working on a solution?”

Whatever metrics that Google uses, we can only speculate on, as their methods and algorithms are a tightly held secret. So let’s start by considering Google’s “google analytics” software…

What is google analytics?

First introduced in 2005, Google analytics is a free web analytics service that tracks and reports website traffic. It can be defined as a powerful tool for measuring the success of one’s website, their marketing efforts, and their products and services (Ledford JL, Teixeira J, Tyler ME, 2010, p. xxiv). It is a software program that generates metrics or measurements such as the number of people who come to your site, how they get there and what they are doing while they are there and much much more.

So if you’re really serious about analyzing your marketing like L’oreal or Nest, you get the ‘Gucci’ version of Google analytics called Google Analytics 360 Suite. The Google analytics 360 suite was released recently and is an upgraded version of their Google analytics premium with a nice price tag of approximately $150K per year subscription.

Can we assume that Google might use their own analytics software or perhaps a more sophisticated version of this software to track their marketing performance? Or perhaps some fancy complex algorithms only known to them to keep ahead of the competition?

Do Google consider consumer behavioural metrics?

Google analytics is one of the most popular metrics software that businesses use to track website traffic and clicks. And what’s more – it’s free! People underestimate the power of free because consumers love getting products for free and this stimulates consumers to try new products (Pauwels and Weiss, 2008, p. 14). When google analytics was first released in 2005, sign-ups had to be suspended because Google could not cater to the demand. Since then, Google has since released many other paid products such as Adwords and AdSense and home and office subscriptions of gmail and docs and many others. One of the biggest complaints from consumers is Google’s habit of withdrawing products or features of products even though they are still in use by consumers and sometimes those products are never replaced. Or forcing users of their products to use only Google-related products for which Google were fined.  This could potentially cause consumers to turn to a competitor to find a similar product to satisfy what they want. Could the defection rate or customer complaints be too negligible compared to the cost of maintaining those products and keeping them on the market? Or are these behavioural metrics not measured or considered? How is it possible for Google to be fined? Did they not consider this outcome?

search graph

Google experiments on memory metrics

Google tested 3 versions of the same ad 15 second, 30 second and 2.17 minute ad compared when viewed online and compared the metrics in consumer; tested how viewers responded by how much they watched, ad recall and brand favourability from the ads.

What they found is that making ads shorter does not necessarily get more attention, and making ads longer allows for the weaving of a greater story around the brand. Having a 30 second ad was found to be the best and Google suggested that “weaving a brand early in the storytelling” was better. This is a testament to Google’s commitment to its consumers assessing how a client’s brand needs to be weaved into an ad and looking at consumer’s attention span for an ad. Or is this a ploy to utilize Google products and stay with Google longer?

How can Google stay on top?

Google has a weakness in its physical availability metrics. Let’s face it, Google is an online company, it is all about technology and it was recently identified in a SWOT analysis that its business is too dependent of the internet and it has minimal physical presence. This may be why recently the Google company was splintered to form Alphabet Inc as a parent company which now overseas a number of other operations such as robotics and life sciences to expand their business model. It will be interesting how they consider marketing this in the future.

Published by Patricia Vietheer (Student Number: 215464584)

References:

Ambler T, Roberts, JH, 2008, Assessing marketing performance: don’t settle for a silver metric, Journal of marketing management, Vol 24, No 7-8, pp 733-750.

Ledford JL, Teixeira J, Tyler ME, 2016, Google Analytics 3rd Edition. Hoboken, US: Wiley, 2010. ProQuest ebrary. Web. Accessed: 21 May 2016.

Mintz O, Currim IS, 2013, What drives managerial use of marketing and financial metrics and does metric use affect performance of marketing-mix activities?, Journal of Marketing, Vol 77, pp 17-40.

Pauwels K, Weiss A, 2008, Moving from free to fee: How online firms market  to change their business model successfully, Journal of marketing, Vol 72, p. 14-31.

 

The Biggest Winner in the Weight Loss Game

Integrated marketing communications (IMC) is “marketing planning that ensures a company’s various advertising efforts send a coherent story across the different customer touch points” (Iacobucci, 2013, pp 159). And the biggest winner in this game is the Biggest Loser’s personal trainer celebrity Michelle Bridges (MB).

What is 12WBT?

First created in 2010, 12 week body transformation (12WBT) is Michelle Bridge’s 12 week exercise, nutrition and mindset program. For $19.99 per week, you get the 12WBT experience starring Michelle Bridges herself. You sign up to the challenge which runs every 5 months or so with pre-season training, weeks ahead to get you started and learn the ropes. The program includes an exercise plan, a meal plan and mindset videos, food diary, shopping lists and much, much more and these can be integrated into apps such as My fitness pal or 12WBT app itself.

12WBT Mindset page example Source: www.12WBT.com.au

12WBT Mindset page example
Source: http://www.12WBT.com.au

There are 15 programs to choose from and is then further tailored to the individual member whether you are looking to lose weight, improve shape and tone or learn how to run. The results are communicated by the consumers themselves with before and after shots, expressions of gratitude on social media and the results of the transformation process.

Michelle Bridges Products everywhere

Like 54% of Australians, my 2016 new year’s resolution was to get fit and healthy and loose a few kilos. To get motivated, I headed off to Big W to find a whole range of MB active wear on sale. I grab a MB waterbottle with free exercise planner and MB runners to complete my look.

Donning on my new gear and with MB on the brain, I searched my Spotify app for Michelle Bridges and sure enough, I got “Michelle Bridges 12WBT” with a playlist of running music suited to my running style. After my run, I headed to Woolworths to find MB frozen meals on offer. I quickly look up product reviews to see if they are any good. Easily heated in the microwave, I sit down to watch a bit of telly, only to be hit with the Michelle Bridges 12WBT ads.

To add to the mix, there’s about 10 bestselling books to read and multiple exercise and nutrition DVDs and even MB featuring in an Xbox exercise game. These are just the many touch points of integrated marketing to help expose consumers to the MB brand which according to a McKinsey digital matters survey showed that the more touchpoints a brand has, the higher the probability that the brand would be selected for purchase.

Socialising with Michelle Bridges

The 12WBT is a social program where everyone is showing their progress as the weeks go by. Therefore it is not surprising that there is a very strong social media presence. There are over 111,000 followers on Twitter, and over 834, 000 likes on Facebook for the 12WBT on top of Michelle Bridges own personal pages. Instagram, Youtube, Pinterest and blogs are also allowing the MB brand to expand its reach.

IMC also involves the development of relationships with consumers through strategic messages and dialogue (Phelps, 2009). Connecting with Salesforce has streamlined how the MB team can connect with all their signed up consumers plus connect to potentially new members giving each a one-on-one experience. Here’s how:

Mangold and Fauld (2009) suggest that the communication capabilities of social media allow consumers to engage with the brand and therefore strengthen brand relationship. Michelle Bridges has it all, whether it is social media, radio, TV, magazines, billboard or webpage, the MB brand message is simple – Exercise, diet and mindset will transform your life for the better. The main target segment are overweight middle aged women who aspire to be like Michelle and what Michelle gives them is hope and a vision to look good and feel good about themselves and be successful.

“good digital experiences keep consumers loyal and that loyalty is built through useful experiences, not 30-sec TV commercials”

According to Razorfish 2015 Global Digital Marketing Survey (2015, p. 12), “good digital experiences keep consumers loyal and that loyalty is built through useful experiences, not 30-sec TV commercials”. Consumers are bombarded by “over 5,000 brand messages a day, and are therefore becoming savvy at avoiding or deflecting advertising”. The MB brand is successful because it has a clear message, is truly user-centric, engaging and their “services are designed to make people’s lives better”.

The Marketing Goal

The goal is to sign up as many members to the 12WBT program as possible while retaining current members. The touch points can be any of MB products whether it is active wear, packaged meals, kitchenware or books.

12WBT Source: Pinterest/michellebridges

12WBT
Source: Pinterest/michellebridges

Touch points can also be via social contacts through any social media channel or word of mouth from current members who draw you in to take the challenge.  Michelle features in magazines, editorial features on TV and billboard ads that constantly remind us to diet, exercise and change our mindset. And the media channels are all integrated that draw you down the rabbit hole to sign up to the challenge or buy one of her products. The social pages have daily postings of short workout videos or simple diet recipes that allow the endorphins to kick in and keep you coming back for more.

Negative criticism only draws attention to the MB brand

In April, 2016, radio show hosts,Chrissie Swan and Meshel Laurie criticized Michelle Bridges’s comment on the ABC’s Australian story “Building Bridges” where she said “that she has never met a happy obese person”. Swan says that she is a happy fat person and that she has known Bridges for many years. According to Berger, Sorensen and Rasmussen (2010, p. 815), negative reviews can sometimes increase sales. Chrissie and Meshel’s criticisms only serve to draw attention from other overweight women who may or may not be happy towards Bridges brand and her products potentially increasing sales and awareness.

What’s next for the queen of exercise and diet?

Michelle Bridges has hit BRW’s 2015 richest self-made women’s list with a net worth of $53 million. Can she do no wrong? The MB brand is looking to expand its reach into the US market where the Biggest Loser show all began. Their marketing campaign may have worked wonders in Australia but the Razorfish survey showed that there are differences between segments in how they view marketing tactics. For example, 83% of US Gen X people view targeted advertising on their mobile phones as an invasion of privacy and therefore Michelle’s team will need to carefully consider their marketing strategy and not just do a cut and paste version (Razorfish, 2015, p. 6). With a great marketing strategy behind her, Michelle may have a good chance of continuing her success.

By Patricia Vietheer (215464584)

References

Berger J, Sorensen AT, Rasmussen SJ, 2010 Positive effects of negative publicity: when negative reviews increase sales, Marketing Science, vol. 29, No. 5, pp 815-827.

Iacobucci, D 2013, Marketing Management (MM4), Student Edition, South-Western, Cengage Learning, Mason, Ohio.

Mangold W, Glynn D, Faulds J, 2009, Social media: The new hybrid element of the promotion mix, Business horizons, vol 52, no. 4, pp 357-365.

Phelps JE, Milne JR, 2009, Integrated marketing communications and new media: Emerging privacy issues, International Journal of Integrated Marketing Communications, vol 1, no. 1, pp 84-93.

Razorfish, 2015, The 2015 Global Digital Marketing Report: Digital Dopamine, URL: http://www.razorfish.com/binaries/content/assets/ideas/digitaldopaminereport2015.pdf

Is Target Australia’s transformation fueled by marketing research?

Target Logo

If you ever shop at Target, you are probably familiar with their “do you have flybuys?”, “fill out our survey and go in the draw for a $1000 gift card” or “Tell us your experience” lines.

When you first enter their website, a popup asks you to fill out yet another survey so they can improve their website. Loads of data collected but quantity does not equate to quality. Marketing research is the gathering of data or facts needed to make marketing decisions (Iacobucci, 2014, p. 199). Any organisation can accumulate as much data as they want but the question is – how can they capitalize on that data turning it into successful marketing campaigns?

Data, data and more data

Big data is the “collection, analysis and generation of insights from a wide variety of data sources in order to be able to improve business performance” (Fitzsimmons, 2013). Target assigns a unique ID code to each new customer. Every time that customer uses a credit card, flybuys card, coupon, get a refund, fill out a survey, use the website, open Target’s email or call their helpline, it is linked to that unique ID.

“We want to know everything we can”

“We want to know everything we can”, says Andrew Pole, a statistician employee of Target USA . Target can also buy data to access more information associated with that ID such as ethnicity, marital status, number of children, which magazines they might read, where they live and much more. Is this data reliable, valid and representative of the segment of consumers you are analyzing it for? Of course this data is useless, unless analysed effectively and turned into an effective decisions that solves a problem. So what does Target do with all that data?

Target Australia’s transformation to enhance customer’s shopping experience

Data-driven or big data marketing is the “collecting, analyzing and execution of insights from structured and multi-structure data such as big data across the enterprise to drive customer engagement, improve marketing results and measure accountability” (Arthur, L, 2013, p. 48). Target Australia is currently undergoing a transformation and rebranding and it seems they want more customer engagement.

Number 1 on their transformation strategy list is to enable outstanding customer experience (WesFarmers annual report, 2015; page 38). And customers are loving the new experience that is the “next generation” Target stores. New shop layout with added extras for enhanced customer experience such as a café, clothing alteration service, T-shirt printing, beauty advisors and “click & collect” shopping – all designed to keep you shopping for longer.

Target’s newest marketing campaign in 2015 launching a jeans range designed by John Paul Gaultier, the “Find your jeans” campaign was in response to “insights that many women feel alienated by jean fits and sizes”. Obviously, the “insights” are driven by their marketing research surveys of what their female consumers want.

Mobile Marketing

According to emarketer, mobile advertising is set to exceed $100 billion in 2016 accounting for 51% of digital marketing.  As a part of their transformation, Target has launched a new mobile app which is more interactive and has more features like product scanning and pricing. The ios app is said to have been driven by customer surveys. Target staff spent “weeks in store speaking to customers” leading to the release of the app. The app could potentially lead to more data showing which products customers are interested in and whether pricing is an issue anywhere anytime. Neural and behavioural studies have shown that consumers can associate pricing with value and that the “sequence of information during a purchasing decision alter the mechanisms underlying product evaluation and influence choice behaviour” (Karmarkar, 2015, p. 476). And Target certainly plays up the lower prices tagline.

Personalised one-on-one marketing

In 2012, Target USA store hit the news because they figured out that a teenager was pregnant before her father did and had sent her baby promotional material. Through predictive modelling and analysis of big data, Target could tell if a particular customer was pregnant and then tailor their marketing to that particular customer.

It seems that 47% of Australian marketers are already using predictive methods to analyse what will deliver the most relevant, personalized customer experience. Although we are not privy to the actual results of Target’s marketing surveys, we can certainly see the outcomes in their transformation.

So, what would Target’s future marketing scene look like?

Wind the clock forward 5, 10 maybe 15 years, what should we expect from the brand that claims to provide quality  at affordable prices for the whole family? The following clip is one possibility – more interactive, enhanced experience, marketing delivered to the customer in real-time with maybe a bit of artificial intelligence thrown into the mix perhaps?…… I can’t wait to see that.

Published by Patricia Vietheer (215464584)

References:

Arthur, L 2013, ‘Big data marketing: Engage your customers more effectively and drive value’, John Wiley & Sons, Hoboken, New Jersey USA, Part II, p. 48.

Fitzsimmons, C 2013, ‘Big data? Big deal’, BRW, Fairfax Media Management Pty Limited, USA.

Iacobucci, D 2014, Marketing Management (MM), 4th Edition, South-Western, Cenage Learning, Mason, Chapter 15.

Karmarkar, U, Shiv, B, Knutson, B 2015 ‘Cost Conscience? The neural and behavioural impact of of price primacy on decision making’, Journal of Marketing Research, Vol. LII pp. 467-481 doi: 10.1509/jmr.13.0488

WesFarmers 2015 Annual Report, https://www.wesfarmers.com.au/about-us/corporate-governance.html

The Price of a Cure

Gilead Pills. Source: http://www.fotocommunity.de/

Gilead Pills. Source: http://www.fotocommunity.de/

Big pharma giant targets, positions and scores big time with hep C drugs

Imagine finding out you have a life-threatening illness. How much would you pay for a cure?

For the 150 million people worldwide who are infected with hepatitis C, there is a cure! But it comes at a cost, a very big cost of US$96,500 per treatment course. For pharmaceutical drug company Gilead Sciences, the hep C drug market segment is a no-brainer – hep C-infected patients. Analyse that segment further and you find 70% live in poor countries and many are not going to afford the cure. An analysis of the US segment of the market revealed that 60-70% of hep C sufferers are people who inject drugs, many of whom come from low socioeconomic backgrounds. Again, they are not going to afford the cure either.

Gileads 2015 Revenue and Sales Figures. Source: Gilead Annual Report 2015 - www.gilead.com

Gileads 2015 Revenue and Sales Figures. Source: Gilead Annual Report 2015 – http://www.gilead.com

So how is it possible that big pharma giant Gilead is able to make record sales 3 years in a row, raking in a total revenue of $32.6 billion in 2015? The answer is all about positioning….

Patients’ attitude to previous hep c treatment

Imagine having flu-like symptoms for months, aches and pains, fatigue, headaches, insomnia, anxiety and/or depression, paranoia and even suicidal tendencies. These are the many side effects of interferon therapy which was the gold standard for treatment having only 50% chance of clearing hep C. No, thanks – with symptoms like this, it is not surprising that most patients give up treatment due to the impact on their quality of life.

The game changer

Sovaldi was the first of Gilead’s blockbuster hep C cures, claiming up to 90% cure rates and very few mild side effects.

Gilead’s “Forget me not” marketing campaign was aimed at the hep C sufferers who were waiting for that cure to come along and directs them to seek help from their doctor. But there was a catch – it came with a US$84,000 price tag. And for those who had private insurance, why not make the insurance companies pay for it? Insurance companies were feeling the squeeze and so hit back at Gilead for their high costs.

Gilead was not going to be deterred as they had another card up their sleeves. Enter Harvoni – Gilead’s next blockbuster miracle cure for hep C with claims of up to 99% cure rate covering all 6 genotypes of HCV. Taken as a drug on its own, consumers do not need the drugs of old and can say goodbye to the horrible side effects that came with interferon injections. Gilead’s positioning is in “improving lives”. And of course, customers see Harvoni as the saviour in their lives. Gilead has opted for the big guns – a direct-to-consumer advertising in their “I am Ready” marketing campaign, a multi-million dollar marketing campaign for a $1000 per pill product.

“Patients have Harvoni on the mind because of these TV commercials,”

Generally, pharmaceutical companies advertise to doctors since they prescribe and recommend drugs to patients and prescription drugs are not usually displayed in pharmacies (Spiller, Wymer and Walter, 2002). It is a bold move by Gilead to market a prescription drug direct to consumers but one that has reaped rewards with Gilead’s 2015 sales for Harvoni exceeding US$4 billion.

“Patients have Harvoni on the mind because of these TV commercials,” said Mount Sinai Hospital hepatologist Dr. Douglas Dieterich. The ad features all the benefits of Harvoni that consumers would value – positioning the drug as restoring one’s quality of life. The ‘I am Ready’ ads have been aired on all the major TV networks in the US including FOX, CBS and ABC targeted at baby boomers aged 50-70 year olds who are 5 fives more likely to carry hep C. The US baby boomers are also more likely to have more advanced stages of liver disease and more likely to afford the drugs via their private insurers who are only reimbursing clients with evidence of liver scarring.

The competition emerge but will it drive down prices?

“Never before have drugs been priced so high to treat such a large population”

Gilead can get away with the huge price tag but for how long? “Never before have drugs been priced so high to treat such a large population” says Steve Miller, Chief Medical Officer at Express Scripts, US’s largest manager of drug benefits for employers and insurers. And consumers are queuing up to pay the cost because it is cheaper than a new liver.  Gilead’s competitors are Bristol-Myer-Sqibb’s Daklinza, AbbVie’s Viekira Pak and Merck’s Zepatier. These new drugs entered the market after Gilead and are therefore cheaper than Gilead’s Harvoni but can they steal Gilead’s thunder. Gilead has given many Indian companies licenses to make generic versions of their hep C drugs and selling them for under $5 a pill. Does this mean Gilead will reduce their price in the US? Currently there is no need – Gilead’s strong product together with aggressive marketing strategy has forced their competitors to choose other niche perhaps less profitable markets. Merck for example, have decided to focus on a niche hep C market targeting difficult to treat patients. 

Australia: small segment, big buying power

Australia is a small market segment with only 200,000 people infected. In December 2015, the Australian Federal Government announced that it was going to spend $1 billion dollars over the next 5 years towards cheaper drugs for hep C. On 1st March, 2016, both Sovaldi and Harvoni appeared on the Pharmaceutical Benefits Scheme (PBS) making Gilead’s drugs much more affordable to consumers for as little as $6.10.

Exploiting the buying power of governments for a smaller market is a clever strategy allowing Gilead to address smaller segments and still be profitable. It seems taxpayers aren’t complaining because experts are saying they could be eliminating hep C in Australia in the next 10-15 years.

Advancing therapeutics, improving lives if you can pay the price

While the tactic of spurring further governments around the world to buy into Gilead’s miracle drugs now are filling the company’s pockets, the elimination of the disease means a rapidly declining market in the future. Gilead needs to find the next big blockbuster drug to stay on top. So, what’s next for Gilead? With a long list of products being developed in the pipeline such as therapeutics for HIV-AIDS and other liver diseases, Gilead would need to pull a new rabbit out of their hat to top Harvoni.

References

Iacobucci, D. (2014) Marketing Management (MM), 4th Edition, South-Western, Cenage Learning, Mason.  Chapter 3, Segmentation, Chapter 4, Targeting and Chapter 5, Positioning.

Blackett, T and Robins, R (2001) Brand Medicine – The role of branding in pharmaceutical industry. Palgrave Publishers Ltd, New York. Chapter 5: Direct to consumer advertising – the US perspective.

Spiller, L., Wymer, Jr., and Walter, W. (2002). Physician’s responses to marketing strategies of Pharmaceutical Companies. Journal of Pharmaceutical Marketing and Management. Vol 15: Issue 1

Written By: Patricia Vietheer Student No: 215464584