Analytics in Functional Areas - Marketing Analytics

1. ANALYTICS IN FUNCTIONALAREAS
Course Code : COB204B51
Credits :4 Hours : 60

2. LEARNING OBJECTIVE
Analytics in
different domains
Analytics in
different
functional areas.
Analytics
Applications in
business
To equip
students with
basic
knowledge of

3. Course Outcomes
Apply
analytical
techniques in
marketing and
sales to
maximize
customer
lifetime value
and business
value
Make use of
HR analytics to
facilitate better
workforce
planning and
talent
acquisition
Analyze time-
series data and
evaluate the
risk-reward
trade-off
using finance
analytics
Solve supply
chain
problems by
applying
optimization
and simulation
techniques

4. COURSE CONTENTS
No. TITLE
Unit - I Marketing Analytics
Unit – II Human Resource Analytics
Unit - III Finance Analytics
Unit - IV Supply Chain Analytics

6. Root Cause Analysis Examples
Example #1
Suppose the sales manager at XYZ company needs to figure out the reason for the sales performance gap of a particular
team in the recent quarter. She decides to conduct the Root Cause Analysis on the sales team’s performance. She goes
through the data of the past six months to understand the trend of the sales and creates the fishbone diagram for the same.
The sub-causes include:
1. Inefficient sales team and team-leader 2. High targets 3. Demotivated sales executives
4. High level of competition
The purpose was “How to reduce the sales gap?” On examining the information so acquired, she found that the root cause is
the team leader’s inefficiency in motivating the sales executives and providing unrealistic targets to them.
Moreover, the team leader pressured the team with penalties and offended them in other ways. This resulted in a
demoralized, non-performing, and inefficient team. In turn, the demotivated sales team were ineffective in convincing the
customers. They took no interest in understanding the customer’s requirements. Thus, the unsatisfied customers moved to
the competitors.
Therefore, the prominent solution so derived is to counsel or replace the team leader. And also, motivate the team members
by training them and fostering a supportive work environment.

11. Tentative Assignment topic

13. Pedagogical tools
PPT
Interactive
Video
Case study
Root
cause
Analysis
–
Problem
solving
by using
critical
thinking
ability

14. BLUE PRINT
Unit
Hours
Allotte
d in the
Syllabu
s
No. of Questions & Marks Distribution
Part A
(No. of
Questions
)
Total
Marks
Part B
(No. of
Questions
)
Total
Marks
Part C
(No. of
Questions
)
Total
Marks
I 15 2 04 1 5 1 12
II 12 3 06 2 10 2 24
III 13 2 04 2 10 1 12
IV 20 3 06 2 10 1 12
Total
60
Hours
10
(includin
g Choice)
20
(Marks
including
Choice)
7
(includin
g Choice)
35
(Marks
including
Choice)
5
(includin
g Choice)
60
(Marks
including
Choice)

15. BOOKS FOR REFERENCE
1. 1. Sunil, C., & Peter, M. (2013). Supply Chain Management:
Strategy, Planning, And Operation, 5/e. Pearson India.
2. 2. Robert S. Kricheff,” Data Analytics for Corporate Debt
Markets: Using Data for Investing, Trading, Capital Markets,
and Portfolio Management,”FT Press Analytics.
3. 3. Christopher N. Chapman and Elea McDonnell Feit, “R for
Marketing Research and Analytics 2015 Applications
Paperback, Sage Publications India Private Limited; 1st
edition.
4. 4. Tony Miller (2016), HR Analytics and Innovations in
Workforce Planning (Human Resource Management and
Organizational Behaviour Collection), Business Expert Press.

16. MARKETING ANALYTICS
Definition
Nature
and scope
The
Marketing
Process
Customer
Life Time
Value
Marketing
Metrics
Introduction to
Segmentation
Market
Analytics
Customer
Analytics

17. Marketing Analytics
Modern marketing is a data-driven process fueled by analytics.
Without analyzing relevant key performance indicators (KPI), businesses
can't tell whether their marketing efforts are providing the expected return
on investment (ROI).
Marketing analytics is the key to evaluating past performance and
determining how to improve it going forward.

18. ROI
According to a survey of senior marketing
executives published in the Harvard
Business review,” more than 80% of
respondents were dissatisfied with their
ability to measure marketing ROI.”

19. MEANING
Marketing analytics is a set of technologies and methods used to transform raw data into marketing
insights.
The goal of marketing analytics is to maximize ROI from an enterprise's marketing initiatives.
Marketing analytics encompasses tools for planning, managing, and evaluating these efforts across every
channel.
Marketers use established business metrics, and sometimes create new KPIs, to measure the success of
their organizations' marketing initiatives. These metrics include:
•Profitability segmented by demographic
•Blend rate
•Customer lifetime value
•Customer satisfaction
•Public perception

20. BRIEF NOTE
Marketing analytics is the study of data to evaluate the
performance of a marketing activity.
By applying technology and analytical processes to
marketing-related data, businesses can understand what
drives consumer actions, refine their marketing
campaigns and optimize their return on investment.

21. DEFINITION
According to Merriam-Webster, market analysis is:
“a phase of marketing research conducted to determine the characteristics
and extent of a market”
On the other hand, Alexa defines market analysis as:
“a quantitative and qualitative assessment of a market. It examines the
market size, various market segments, customer buying patterns, the
competition, and the economic environment”
In both cases, it’s clear that market analysis is a tool used to assess or
characterize a market.

22. Tentative Assignment topic

24. THE SCOPE OF MARKETING ANALYTICS
Assessing marketing campaigns: Marketing Analytics tools provide precise
information about campaign performance along with determining areas of
improvement if any and predicting how they would perform in the future.

25. Competitor assessment: Tools help to understand if the competitor
campaign is doing better and why it is doing better. It helps to understand
what competitors are doing right and if they are using certain channels that
might garner more campaign success.

26. Assessing the company that has initiated the marketing
campaign: Finally, it allows you, the campaign originator to reflect
as an organization if the marketing resource allocation is appropriate
or not. It also helps in understanding next steps that need to be taken
allowing to reshuffle priorities. Lastly, it helps to understand if money
and time are being immersed in the right marketing mediums.

31. MARKET BASKET ANALYSIS

33. MARKETING PROCESS
Can you just make a
product without any
research and start
selling it?

34. ANSWER
Technically, you can, but it is only
possible if you are offering something
people consume on a regular basis,
such as FMCGs, eatables, etc.

35. QUESTION – SALES IS GOOD!
you had proper research;
you identified the needs of a
specific group of people and
then offered a solution
accordingly.

36. MEANING
The marketing process, in simplest words, involves everything from need
identification to customers’ satisfaction.
The marketing process is used to analyze the various opportunities that are
available in the marketplace to exploit profitable gaps.
It aims to select the target markets and then develop a smart marketing
strategy and then contribute to the management of the efforts in marketing.

39. MARKETING ANALYTICS
Def
initi
on
Nat
ure
and
sco
pe
The
Marketing
Process
Customer
Life Time
Value
Marketing
Metrics
Introduction
to
Segmentatio
n
Market
Analytic
s
Customer
Analytics

41. In marketing, customer lifetime value (CLV or often CLTV), lifetime customer value (LCV), or life-
time value (LTV) is a prediction of the net profit contributed to the whole future relationship with a
customer.
The prediction model can have varying levels of complexity and accuracy, ranging from a crude
experiential to the use of complex predictive analytics techniques.
Customer lifetime value can also be defined as the monetary value of a customer relationship, based
on the present value of the projected future cash flows from the customer relationship.
Customer lifetime value is an important concept in that it encourages firms to shift their focus from
quarterly profits to the long-term health of their customer relationships.
It’s still important to find new customers for the growth of the company, but optimizing the lifetime
value of existing customers is also essential for a company to sustain a viable business model.

42. Definition
Customer Lifetime Value or CLTV is
the present value of the future cash
flows or the value of business attributed
to the customer during his or her entire
relationship with the company.

45. COFFEE SHOP
A coffee shop is a perfect starting example for CLV, as it is easy to
understand even if you don’t have an extensive business background.
Let’s say a local coffee chain with three locations has an average sale
of $4. The typical customer is a local worker who visits two times per
week, 50 weeks per year, over an average of five years.
CLV = $4 (average sale) x 100 (annual visits) x 5 (years) = $2,000

46. It is a prediction of the net profit
contributed to the whole future
relationship with a customer.

47. For example,
let’s say you run a Health Club where customers pay Rs 1000 per month and the
average time that a person remains a customer in your club is 3 years. Then the
lifetime value of each customer is (according to the formula above)
Rs 1,000 per month x 12 months x 3 years = Rs 36,000. This means each
customer is worth a lifetime value of Rs 36,000.
Once we calculate CLTV we know how much the company can spend on paid
advertising such as Facebook ads, YouTube ads, Google Adwords etc. in order
to acquire a new customer.

48. For the last example, let’s assume an online
video streaming service has multiple price
plans, but the average customer spends $17
per month. Customers typically subscribe for
three and a half years and use automatic
monthly payments.
CLV = $17 (average sale) x 12 (annual
purchases) x 3.5 (years) = $714

49. CONCLUDE
CLV is the Key
Performance Indicator
that determines the
value of a customer.
With this, you will be
able to determine how
much you can spend to
attract customers for
the long run while
taking into account
repeat purchases of the
customer.

50. Customer Lifetime Value is an important metric as businesses would want to think about the overall
market spending.
CLV helps businesses make important decisions about different departments like- sales, marketing,
product development and customer service and support.
Marketing: What
amount of money will
be spent on acquiring a
new customer?
Product: What changes
in the product will best
suit the need of the
customers?
Customer support: How
much money needs to
be spent to acquire
talented customer
support staff, so they
provide perfect
customer service?
Sales: What types of a
customer should sales
workers spend the most
time on trying to
acquire?

51. Importance of Customer Lifetime Value (CLV)
It predicts real-
time ROI
Helps enhance
marketing
retention strategy
Create an effective
message for the
target audience
Helps in
understanding
customer behavior
A better output
from customer
support

52. What is meant by customer lifetime value?
Customer lifetime value refers to the entire amount a business
earns from the average customer over the course of their
relationship with the business.
What is customer lifetime value, and why is it important?
Customer lifetime value represents the total earnings from a
customer over the duration of their relationship with the business.
This helps a company forecast profitability, set customer
acquisition budgets and determine goals for growth and
improvement.

53. MARKETING METRICS
“If you can’t measure it,
you can’t improve it.”

54. MEANING
Marketing metrics are values marketers can monitor to
measure the performance of their campaigns. These values
can tell how effectively your marketing efforts are leading
audiences to take actions that generate value. But blindly
measuring any metric can present a partial or skewed picture
of how things really are.
Marketing metrics tell marketers what data to collect and
analyse. The marketing metrics measure should differ based
on the channels, goals, and formats of your campaigns.

55. Marketing metrics should consider tracking
General metrics
Retention metrics
SEO metrics
Paid ad metrics
Email metrics
Social media metrics

56. a. General metrics -1. Revenue growth
Revenue growth is the difference between two revenue
numbers.
For example: before and after a marketing campaign.
How to calculate it
Revenue Growth (%) = ((Revenue at end - Revenue at
start) / Revenue at start) × 100

57. 2. Customer Acquisition Cost (CAC)
CAC is the amount it takes your business to acquire a customer.
The lower the number, the better.
It’s primarily used in relation to other metrics like lifetime value (more
on that later) to work out how much you can afford to acquire
additional customers in the future.
How to calculate it
CAC = Total amount spent on marketing / Number of new customers
acquired

58. 3. Conversions
A conversion happens when a visitor to your website completes an action that you
are tracking.
Examples include sign-ups, demo bookings, and purchases.
Tracking conversions allows you to see where customers are completing key actions
in their customer journey.
How to calculate it
In Google Analytics, you can set up Goals and then track conversion rate (the
percentage of people completing an action) across your site.
In the image below, we can see which pages visitors land on before purchasing a
product. We can also see the conversion rate and the revenue attributed to the
conversions:

60. 4. Share of Voice (SOV)
Share of voice tells you how visible you are compared to competitors.
Market share and share of voice are closely tied to one another. If
you’ve got a 20% share of voice, you’re likely to have a similar
market share.
That means SOV can be an indicator of future growth.
How to calculate it
Share of voice = Brand visibility / Total potential visibility

61. It’s not practical to measure SOV for multiple
channels simultaneously, so you’ll need to calculate
it on a channel-by-channel basis.
Here’s how to do it for organic search:
 Create a list of important keywords
 Add them to Rank Tracker
 Go to the Competitors report
 Check the Visibility column

62. 5. Return on Investment (ROI)
ROI is a measure of the impact a campaign or channel had on the revenue of the
business.
How to calculate it
ROI = (Revenue attributed to marketing spend - Marketing spend) / Marketing
spend
The higher the number, the better the ROI.
ROI is easiest to calculate through channels like paid advertising, where
advertising pixels can effectively track the journey from lead to customer.

63. b. Retention metrics
Marketing isn’t only about attracting new customers but
also retaining existing customers. The longer you keep a
customer, the more profit you’ll make from them.
6. Churn rate
Churn is the rate at which customers stop paying you.
How to calculate it
Churn rate = (Revenue lost during period / Revenue at start of period) x 100

64. 7. Lifetime Value (LTV)
LTV shows how much on average a customer pays you across
their whole relationship with your business.
How to calculate it
For an ecommerce business:
LTV = Avg. Order Value x Avg. Annual Purchase Frequency x
Avg. Customer Lifespan

65. 8. Net Promoter Score (NPS)
NPS is a widely used metric to measure customer satisfaction levels.
Dissatisfied customers will often give low scores indicating that
they’re likely to churn in the future.
How to calculate it
NPS = Percentage of Promoters - Percentage of Detractors
Using a single strictly-defined survey question, NPS asks: ‘How
likely are you to recommend {Company Name} to a colleague?’

68. 9. Repeat Purchase Rate
Repeat Purchase Rate is the percentage of customers
who buy from you more than once.
It’s widely used in ecommerce to predict how effective a
business is at retaining customers.
How to calculate it
Repeat Purchase Rate = Number of customers who more
than once / total number of customers

69. 10. BRAND MENTIONS
Brand mentions show you how frequently you’re part of the conversation in your industry.
When a web page mentions your company or closely related terms like prominent employees (in relation to their work),
you have received a brand mention.

70. SEGMENTATION

71. DEMOGRAPHIC SEGMENTATION:
Definition: Demographic segmentation groups customers and
potential customers together by focusing on certain traits
such as age, gender, income, occupation & family status.

72. Examples
Mercedes or Ferrari has income based segmentation
Toothpaste brands life-cycle based segmentation
Gillette has gender based segmentation

76. GEOGRAPHIC SEGMENTATION
It divides the market into graphical units such
as nations, state, regions, countries, cities,
neighborhoods. The main purpose is to operate
in single or multiple areas considering the local
variations of the selected areas.

78. PSYCHOGRAPHIC SEGMENTATION
Psychographics is the science of using psychology and demographics to
better understand consumers.
In this segmentation, buyers are divided into segments on the basis of
personality traits, lifestyle, or values.
Demographic data explains “who” your potential consumer is,
psychographic data explains “why” they purchase.
VALS Framework is one of the popular psychographic measurement
tool.
VALS Framework groups eight segments; Thinkers, Achievers,
Experiencers, Believers, Strivers and Makers.

80. EXAMPLES
Specialization focused Luxury Mobile
Manufacturing Brand
Car companies focuses on
psychographic segmentation.

81. A common example of psychographic segmentation is a luxury mobile-
manufacturing brand that specializes in customization.
These mobiles are not available for people from every class. A certain standard
of living and family income is essential to be able to purchase an expensive
mobile that is customized for each customer.
By using psychographic market segmentation, the marketing team of this
mobile-manufacturing brand can divide the target market according to their
social status first and then on the basis of lifestyles, attitudes, or personality.
They can also evaluate the same variables for their competitor’s target market
as well for the better selection of a market for their branding activities.

82. BEHAVIORAL SEGMENTATION

83. WHAT IS BEHAVIORAL SEGMENTATION?
These segments could include grouping customers by:
Their attitude toward your product, brand or service;
Their use of your product or service,
Their overall knowledge of your brand and your brand’s products,
Their purchasing tendencies, such as buying on special occasions like birthdays or holidays only,
etc.
Behavioral segmentation refers to a process in marketing which
divides customers into segments depending on their behavior
patterns when interacting with a particular business or website.

85. Apple customers are brand conscious and loyal and
Apple has behavioral segmentation.

86. ONLINE SHOPPING BEHAVIORS

90. Which tools do I need for behavioral segmentation?
Behavioral segmentation starts with creating user profiles.
Your website analytics
Browsing history
Cookies
Search history
Purchase history
Social data
Login details
App data
IP addresses

93. Demographic segmentation – age, gender, life cycle stage
(teenage years, adolescence, parenthood, retirement, etc.),
income, social class
Geographic segmentation – depending on your product
and offer it can be region, country, state, province, city, or
even local neighborhood
Psychographic segmentation – lifestyle, personality,
values
Behavioral segmentation – occasions, benefits, user
status, usage rate, brand loyalty, buyer-readiness stage,
and attitude

95. WHAT IS CUSTOMER ANALYSIS?
Customer analysis is the practice of using qualitative
and quantitative data to gain insight into your
customers. The goal is to understand their wants,
needs, pain points, and objectives.
At the same time, customer analysis helps us
understand what drives people to make a purchase,
how and when these purchases happen, the frequency
of these purchases, and other relevant information.

96. 1. Segment the Customers You Already Have
2. Talk to Customers to Find Out what Makes Them Tick
3. Use Existing Customer Feedback
4. Communicate with Your Team
5. Leverage Analytics
6. Create Buyer Personas
7. Use the Customer Analysis Results and Your Personas Across the Entire
Company
8. Based on the Research, Decide which Segments and Personas Should Be Your
Focus
9. Remember that This Is an Evolving Environment

100. Customer Analysis
“If you are not taking
care of your customer,
your competitor will.”

102. #1. MIXPANEL
Mixpanel is trusted by over 26,000 companies worldwide, making it one of the best
analytics tools out there. Mixpanel allows you to understand how your customers
are interacting with your product, which features do they use most often, who are
your power users, and other crucial data.

103. #2. GOOGLE ANALYTICS
One of the most famous customer analytics tools on our list is Google
Analytics. Google Analytics is used by over half of the website owners (55.6%
of all the websites) and is a great way to find key customer data points for your
website and app.

104. #3. KISSMETRICS
An easy to use the platform, Kissmetrics is designed with marketing and sales teams in mind.
Kissmetrics provides in-depth analysis of customer journey by tying data to a real person.
Track customer journey
Track new subscriptions- Revenue .
Identify power users and the features they most use.

105. #4. WOOPRA
Trusted by over 5000 companies worldwide, Woopra is an end-to-end customer
journey analytics that allows brands to track, analyze, and optimize the
customer journey. Analyzing various touchpoints of customer interaction,
Woopra tracks how visitors are browsing your website or app and provides
amazing reports regarding the same.

106. #5. HOTJAR
With a whopping 500,000 users in 184 countries, Hotjar is a popular customer
analytics tool and conversion rate optimization tool. Providing more than just
numbers, Hotjar makes it easy to see for website owners to see how customers
are actually interacting with your website via heatmaps and screen recordings.

107. #6. ZOHO PAGESENSE
Track, analyze, and optimize your website and apps based on crucial behavioral
data from Zoho Pagesense. Quickly see how visitors are interacting with your
website and why visitors behave in a certain way to make better business
decisions.

108. #7. CRAZYEGG
Crazyegg is another great customer analytics tool, thanks to its amazing
heatmapping feature. Businesses use Crazyegg to see where their website
visitors often click, what pages and posts they visit, how far they scroll on a
particular page, and at what point do they leave their website.

109. #8. BRAND24
an online reputation management tool that lets you monitor your business online in
real-time. Track your brand across social media, blogs, news, podcasts, forums,
videos, and more, and keep an eye out on everything that’s happening around
your brand. Brand24 helps users understand their customers better by giving them
insights into what they are talking about.

110. #9. BRANDWATCH
Brands can benchmark their performance against their competitors and
see their strategy, uncover opportunities, and analyze risk before a crisis
happens. Automatically segment and analyzing consumer conversations
online and make data-based strategies to improve customer experience.

111. #10. SPROUT SOCIAL
If you want to understand your social media audience, Sprout Social is the tool for
you. From listening and publishing to engagement and analytics, Sprout Social
provides you with everything your brand needs to succeed on social media. Keep
all your customer interactions, replies, campaigns, and events under check with this
amazing tool.

112. TODAY 02/09/2022 @ 4.00PM

113. Pain points are specific problems faced by current or
prospective customers in the marketplace.
Heat maps - a representation of data in the form of a
map or diagram in which data values are represented as
colours.
Conversion rate optimization (CRO) is the practice of
increasing the percentage of users who perform a
desired action on a website.

114. https://blog.bit.ai/customer-analytics-tools-and-
software/

115. https://www.questionpro.com/blog/customer-lifetime-value-clv/
https://economictimes.indiatimes.com/definition/customer-
lifetime-value
https://www.netsuite.com/portal/resource/articles/ecommerce/cu
stomer-lifetime-value-clv.shtml
https://ahrefs.com/blog/marketing-metrics/
https://noteslearning.com/market-
segmentation/#:~:text=Psychographic%20Segmentation%3A%20Psy
chographics%20is%20the,traits%2C%20lifestyle%2C%20or%20values.
https://www.semrush.com/blog/complete-guide-to-customer-
analysis/