Velocity: The Underused Metric

As marketers look to extract the most useful insight from their data to enhance targeting and campaign performance, there’s an under-leveraged metric that they should consider: velocity.

Recency and frequency have been important targeting levers for digital marketers for quite some time. Frequency is a good indication of general interest, and recency indicates that someone is in the buying cycle. But velocity goes one step farther, letting you drill down deeper to gauge the shifts in a prospect’s interest level. Velocity enables marketers to understand a change in interest and engagement on the part of their customers and then adjust audience segments and campaigns in real time to account for these signals. It also demonstrates how a consumer’s interest increases or decreases as they move through the sales funnel. Marketers can rejigger their strategy and campaigns based on specific insights drawn from velocity.

So what is velocity? Velocity is the percent change in the interest level of a customer over a period of time.  What is included in velocity is based on predetermined measurements set by a marketer. For example, those KPIs might be based on site visits, searches, views or click-throughs that sparked an action such as a request for more information. Basically it quantifies when prospects are “picking up steam” or losing interest by showing how the rate of their interactions with a brand has changed over time.

Take, for example, an ecommerce retailer that sells consumer technology products. By leveraging data that appends a time-stamped record of every interaction to a consumer profile, the retailer can easily tweak offers, promotions and calls to action based on changes in customers’ interest level and engagement with the site.

Having the ability to track the rise and fall of your target consumer’s interest level is an important tool that can make the difference between a frustrated consumer who  abandons his or her shopping cart, and a satisfied customer with whom you’ve successfully closed the deal. Carefully tracking shifts in interest can help you determine whether to dangle a special offer or promotion in front of the target consumer so that you won’t lose them at a crucial stage in the sales funnel.

The limits of frequency targeting. Frequency targeting is an important tool, but it doesn’t tell the entire story. For example, if you only use frequency targeting, if Joe visits a site 12 times a week, he is a much better prospect than, Jill who only visits 5 times a week. But by using velocity, you can determine that Joe’s visits increased from 12 times per week to 15 times per week, while Jill’s visits which increased from 5 times a week to 12 times a week. Jill is a less desirable target based on frequency -- but by the velocity measure, her interest level has doubled, representing a significant increase, while Joe’s activity remains about the same. Jill represents a fresh opportunity for your brand, as someone who has recently had a spike in interest, perhaps indicating that she is moving down the funnel toward purchase.

Increases in interest are important to observe and take advantage of, as are decreases in interest. If someone has shown interest in your brand and products and then has a drop in their interest, they may be cross-shopping with your competitors.  With velocity, you have the opportunity to see this decrease and automatically put an enticing offer in front of them to re-engage them.

What’s required in order to use velocity as a measure? Velocity targeting requires an approach to data storage and analysis that is both unified across channels and is hyper-granular. That hyper-granular focus means that every interaction is stored with a precise timestamp at the individual event level, not merely an aggregated snapshot of activity. Tracking each interaction, rather than rolling them up into aggregated segments or behaviors, allows marketers to take into account the rate of activity.

The second requirement is to create a unified view of the customer across channels. Your customers engage with your brand in many different ways, and velocity calculations need to take all of those interactions into account. The more pieces of information that you’re putting into the platform and pieces of data you’re capturing from your site, search and website, the more robust your velocity calculation will be.

Velocity is under-utilized. Marketers haven’t had much exposure to velocity because it’s a capability that’s challenging to build. It requires a lot of horsepower to store so much granular data, and quickly -- within milliseconds -- not only look it up, but leverage it in a velocity calculation in real time.  Many platforms can’t manage this process.  

The bottom line: Adding velocity to your dashboard mix can give you a much better understanding of your customers. Recency and frequency targeting are great tools that marketers have been using for more than a decade, but they have shortcomings. Being able to understand someone’s change in interest is an incredibly powerful tool that marketers need to consider.

Next story loading loading..