5 Trends of Coronavirus and the Economy

Outlining five trends I’m observing at the moment. NB: These are my personal opinions, mostly based on business news coming out and social media sentiments of people I’m following.

I: Monetary policy of lowering interest rates and “printing money” by buying bonds and stocks by central banks has a limited effect on alleviating the financial crisis. This is because, on one hand, frozen private spending cannot be replaced with these efforts. On the other hand, private investors are in state of fear and uncertainty that the monetary influx cannot mitigate, especially giving the historically long loose monetary policy that has eroded the psychological effect of printing money being the solution.

II: For the same reason, finance policy cannot prevent bankruptcies: it cannot replace private consumption. GDPs of Western societies typically consist more than two-thirds of service sectors — and this is mostly physical, not digital services (especially when looking at number of jobs provided). The lack of this type of economic activity results in immediate drop in demand for labor and thus unemployment. Bankruptcies are expected to follow once financial buffers of the small and medium sized companies are depleted. Finance policy can help by providing unemployment benefits after people have lost their job. It appears increased socialism is a must for surviving the crisis without society going into chaos of crime and looting.

III: What work is essential? Many people now observe that their work effort is really not “needed” — they stay at home and society can still provide functions for basic needs. Food, transportation, utilities… as long as these are provided, anything else is extra. Most people’s jobs are in the “extra” category and thus not necessary for the society to function in the short term. However, their spending on digital services, home delivery services etc. helps alleviate the crisis. This highlights the situation where a minority of workers “do the work” and the role of others is to “consume”, getting their money for consumption from surplus of economic activity.

IV: Inequality among workers that can “go remote” and those that cannot. The large physical service sector consists of jobs that cannot be done remotely (hotels, restaurants, airlines, drivers, leisure services such as cinema). Even those that can are being cancelled which is felt especially heavily by freelancers in creative industries (events, music/audio, etc.). The inequality is drastic: some continue working at home, posting Instagram picture of their “cool” home offices while others are scraping for survival.

V: Trade-off between health and economy. In the short term, society sacrifices economic growth for health, especially that of vulnerable groups, corresponding to a sort of tyranny by minority situation. The longer the crisis continues, the more likely this is to change: one’s people’s livelihood become at risk large-scale, they start less weighing the wellbeing of “others” and demand more wellbeing for themselves. This is especially likely to take place among the work-aged population that most suffers from the seizure of economic activity. Increased questioning of isolutionary measures is likely to take place by latest when the adverse effects hit the white-collar remote workers (marketers, HR consultants, software engineers, etc.). The world cannot stay on hold forever.

Your work is non-essential, according to coronavirus

Some of my observations about coronavirus and economy.

It’s striking how FEW people we need to sustain many. More than a billion people are in physical isolation, BUT utilities (electricity, water, internet) working perfectly. Really a marvel of innovation and automation that shows how well technology and infrastructure in most places has been built.

On the flipside, many people’s work is turning out to be NON-ESSENTIAL. That means, it is not *needed* for satisfying basic needs (food, shelter, and some form of psychological stimulus which is the internet). The interesting dynamics here is to know how long would the working class support the remote workers whose work is really not contributing to anything tangible. …on, the other hand, it does contribute since the remote workers are now the consumers and without consumers, we would not have producers.

There are different levels though, regarding choice (needs vs. wants). Utilities are not a question of choice (want), but that of NEED. I must have water. Somebody needs to do some work to get me that water. The guy doing that work is now thinking “why the hell i need to work for that guy when he’s getting paid (salary or government subsidy) for sitting at home. Let me stay at home as well.” This is the classical communist’s dilemma — people don’t have an incentive to make an effort if they can get the same pay-off without any effort.

The dilemma above is why this is now tricky. Government is needed to ensure an influx of money into the system. Otherwise, MOST people go out of work, because their work output is NON-ESSENTIAL. (Assuming here that the money influx is being used to keep people “working”, meaning they keep making nice and insightful LinkedIn posts like me here, while the real workers are running things.)

…one could also ask, with a good justification, how is this different from what was before? Perhaps in no way at all; coronavirus could be just revealing the fact that most people, no matter how busy or important they portray themselves as, contribute very little to the economy in terms of satisfying any basic need.

One more point is that of HISTORY: interestingly, we can see this pattern emerging since the dawn of civilization. What else was the birth of “clergy” class than the indirect consequence of production surplus? Because not all people were no longer needed to provide food and shelter, they MADE themselves useful by inventing stuff. And the people that did all the work accepted that, for whatever reason. The economy, and society in consequence, has always relied on NON-ESSENTIAL work, it seems.

The inspiration for this post comes from an encounter with a food delivery guy last week. He came to bring me food (=satisfy my basic need) and HE was apologetic for not finding the right place. I told him “no worries at all”, but in my mind I was thinking “dude, you’re saving me from hunger and YOU are apologizing. Can’t you see what’s going on here?”

Keywords: capitalism, Marxism, surplus, division of labor, needs vs. wants

Unit of cognitive effort

We should come up with a unit for cognitive effort. Like in information science you have a “bit” (binary digit that stores information). That concept was made famous by Claude Shannon who is considered as “the father of information theory”.

Here, I’m arguing a metric like “bit” should be developed for measuring cognitive effort of work tasks and individuals. Let’s call this hypothetical metric a “surge”.

So, a simple task would maybe take “5 surges” whereas a medium complex task would take “50 surges” and highly complex task could take “500 surges”. The relationship between different tasks and scale of surges is an empirical question, but I’m thinking the relationship might not be linear but geometric (because cognitive effort required by more complex tasks grows exponentially).

And a person, every one of us, has a certain inventory of surges per day. Like, let’s say Individual A has 10,000 surges because he ranks high on cognitive capacity. Another one, Individual B has only 5,000 surges, relating from poorer cognitive capacity. It’s important to acknowledge that while people differ biologically in terms of their cognitive skills, Individual A doesn’t necessarily perform better than Individual B. In contrary, Individual B can learn to better manage his surges, allocating them in the most optimal way to achieve his or her personal goals.

So, being aware of your “surge inventory” matters, as you can just as easily deplete your surges doing less meaningful tasks (from point of view of your professional or personal goals) or using them in a focused manner to spend less cognitive effort while still achieving the results. Thus, using mental energy becomes a “strategic game”. I believe many successful people already apply this method of sparingly allocating their cognitive effort, without necessarily being aware of it or being able to exactly quantify the process.

Quantifying cognitive effort is important because

  1. user tasks vary by how much cognitive effort (how many surges) they take on average
  2. individuals vary by how much it takes from them to complete the same task
  3. individuals vary by how many surges they have in their “inventory” per day (variation in biological and learned cognitive capacity)

A, b, can c have profound implications both for organizations that want to get things done more efficiently and for individuals that want to develop their skills in more efficiently handling work tasks.

Quantifying cognitive effort as “surges” and then measuring different tasks and individuals would help planning how to allocate resources for both organizations and individuals.

For example, if an organization wants to achieve a Goal X that comprises Tasks 1…n, and we know how many surges each task takes on average and how many surges our people have per day, we can calculate how many days it takes. This could be useful for startups, new product development organizations, or virtually anything. In my experience, currently the work efforts are specified in haphazard ways with very little systematic methodology. This can be one root cause as to why many development projects end up failing.

For individuals, quantifying cognitive effort helps systematically develop productive work habits by letting them evaluate the work effort (in cognitive, not temporal) terms before taking on work tasks. Stress and unrealistic expectations can be managed more efficiently this way, as one knows “I have only 500 surges left but my Tasks 1…n would require 2000 surges… I better acknowledge my limitations and choose to work on Task 2 that requires an estimate of 500 surges, leaving the rest for other days.”

(Some of the best workers I’ve seen are good because they can realistically evaluate the effort needed and don’t take on more they can handle — so, they are already subconsciously doing this.)

Finally, moving from “hours worked” to “cognitive effort taken” makes sense for modern knowledge-based work.

For modern knowledge-based work, time is a poor metric, since tasks vary so strongly by the effort they require. A 2 two-hour intensive session working on a problem is equivalent to 4 hours of simple routine task from a cognitive point of view, maybe even more.

In addition, for personal development of individuals, systematic understanding of where one’s “surge efficiency” is the highest would help reach better efficiency outcomes that would benefit both the workers and the employing organizations.

Some limitations of this thinking:

What’s the relationship between surges and success given the unpredicable nature of creativity in some work tasks? For example, highly complex scientific problems might see a lot of surges being spent on them without any visible result. I wouldn’t still say it’s a lost effort, as payoffs of this kind take the “hockey stick” shape — for a very long time, nothing. Then, an “overnight explosion”. Given this unpredictable nature of innovation, relying too strictly on measures such as “surges” would be counterproductive and wrong.

Let me know if any thoughts!

How to Audit International Facebook Advertising? A 37-Item Checklist

This is a joint article written with Mr. Tommi Salenius who works as a digital marketing specialist at Parcero Marketing Partners.

Introduction

Facebook advertising is a powerful form of online marketing for many purposes ranging from direct response campaigns to brand visibility and awareness. However, the competition in the ad platform is increasing every year, as companies are increasing their investments due to the fact that Facebook advertising, relatively speaking, works very well.

Figure 1 shows how Facebook’s revenue, comprising almost exclusively from advertising, has grown during the last nine years. Last year, almost $40,000,000,000 (that’s forty billion dollars) were spent on Facebook ads.

Figure 1. Facebook worldwide ad revenue statistics from Statista.com.

Increasing budgets imply increasing competition which means that in order to maintain the same visibility, advertisers need to increase their bids. For this purpose, in order to make profit in Facebook, advertisers need to continuously optimize their accounts.

To illustrate the power of Facebook advertising for online sales, Figure 2 shows an example from profitable Facebook account targeting direct online sales.

Figure 2. Example from Facebook account targeting direct online sales.

In this example, every euro invested in Facebook ads has generated direct online sales worth of €10. This means that with budget of €100,000 you can make sales worth of €1,000,000 if your target group is large enough and there is demand for your product (assuming that the sale grow linearly, of course).

The case of international Facebook advertising

Facebook is also one of the best choices to advertise globally, given its user base of more than two billion monthly active users (source: Statista.com).

Using the Locations feature in Facebook Ads targeting, several geographic targeting criteria can be chosen:

  • worldwide (type “Worldwide”)
  • country group or geographic region (e.g., type “in Europe”)
  • free trade area (e.g., type in “GCC, the Gulf Cooperation Council”)
  • sub-regions within a country (e.g., type in “Washington”)
  • other features (e.g., type in “Emerging markets”).

Figure 3 illustrates the Facebook targeting interface.

Figure 3. Targeting interface in Facebook Ads.

At the time of writing (October, 2018), the global targeting options in Facebook include the following:

Country groups

  • Africa
  • Asia
  • Caribbean
  • Central America
  • Europe
  • North America
  • Oceania
  • South America

Free Trade Areas

  • AFTA (ASEAN Free Trade Area)
  • APEC (Asia-Pacific Economic Cooperation)
  • CISFTA (Commonwealth of Independent States Free Trade Area)
  • EEA (European Economic Area)
  • GCC (Gulf Cooperation Council)
  • MERCOSUR
  • NAFTA (North American Free Trade Agreement)

Other Areas

  • Android app countries (paid)
  • Android app countries (all)
  • Emerging markets
  • Euro area
  • iTunes app store countries

Despite the tremendous potential of global advertising in Facebook Ads, companies often do not exploit this potential to the fullest. Moreover, we have observed that large international accounts tend to be messy and not well optimized. Therefore, in the following, we provide a checklist that can be used to audit such international Facebook Ads accounts.

Checklist for auditing international Facebook advertising

Here is a checklist for auditing Facebook paid advertising for international companies. This checklist is a concrete tool that can be used to evaluate your Facebook ad account’s current performance and identifying development areas that can get you toward desired results. There will be four sections: A) Account setup, B) Ad campaigns, C) Organic content, and D) International aspect.

Section A: Account setup

1. Is Facebook Business Manager activated? Benefit: Gain more control over user rights and possibility to operate with partners.

2. Is Facebook pixel is installed and configured? Benefit: Makes it possible to track business-related goals, for example, sales, visitors, blog reading times etc.

3. Is additional software being used besides Facebook Ad Platform? Benefit: Specific tools (e.g. Smartly, AdEspresso, Qwaya) can enhance Facebook performance by providing special features. If they are not used, at least they should be explored.

4. Is international Facebook page feature acclaimed? Benefit: This feature enables unified follower count for country pages but separated content on the country basis.

5. Is ‘business locations’ option used? Benefit: This feature enables to input specific geographic business locations.

Section B: Ad campaigns

6. Are Facebook campaign goals aligned with business goals? Benefit: The campaign goals (e.g. reach, engagement, traffic, sales, leads) should be traced back to overall marketing strategy to ensure they match what is wanted.

7. What is Facebook strategy of the current campaigns? Benefit: In auditing, it is useful to mentally classify the types of campaigns used in the ad account. These can include:

  • technology oriented — e.g., using dynamic ads for advanced targeting
  • content oriented — e.g., using creative concepts to get noticed
  • systematic advertising — i.e., customers need to be reminded regularly
  • ad hoc campaigns — i.e. running ads sporadically without clear purpose

8. Is there something that works already? Benefit: Verifying what already works enables to focus efforts on proven areas (e.g., some campaigns generate sales with low cost, data shows that specific creatives are working, different demographics are responding to ads).

9. Are there budget delivery problems? Benefit: Deliver issues are a common concern in Facebook Ads. Potential reasons: low ad relevance scores, low budget or bids, or not enough conversions (minimum 100 per month), wrong optimization goal. Solutions: change your optimization goal, e.g. from purchases to link clicks, test new target groups and ads, increase budget and bids.

10. Does campaign structure follow best practices? Benefit: Clear division of campaigns provides better tracktability and optimization. There should be different campaigns for all goals: prospecting and retargeting, upselling and cross-selling, reach and sales etc.

11. What auction type is used? Benefit: Auction vs. fixed price: with auction you get better results if you beat competition.

12. What placements are used? Benefit: Performance varies across placements, therefore, they should be tested. Facebook ad platform offers these placements: Facebook, Instagram, Audience Network, and Facebook Messenger. Based on our experiments, Audience Network usually performs poorly, and Instagram is more expensive than Facebook. Moreover, Messenger ads might be thought of more annoying than other placements because they are invading the user’s private space (the inbox).

13. What ad content types have been tested? Benefit: A good account has tested various different ad types (incl. carousel, link ad, instagram story, video, image, canvas).

14. What retargeting types have been used? Benefit: A good account has applied multiple retargeting types (incl. website retargeting, email retargeting, content retargeting).

15. What levels of retargeting are utilized? Benefit: A good account is “deep retargeting”, meaning that retargeting is specified to particular section of the website (e.g., main page, category pages, products pages, blog articles, cart, upselling, cross-selling).

16. What lookalike audience types are used? Benefit: Lookalike audiences can work because they retrieve similar users by “cross-polinating” the targeted subset of users with Facebook’s known information about other users. These options should have been tested (website, email, page likes, purchased lookalikes).

17. Is A/B testing performed systematically? Benefit: A/B test are a sign of active campaign management (both ad set and ad level). Facebook Ads provides a native option for A/B testing as a special campaign type (this campaign type can be used e.g. for testing different creatives, target groups or technical settings).

18. How well are the assets structured? Benefit: Clear naming principles make it easier to analyze and optimize (e.g., are campaigns, ad sets, and ads named systematically).

19. Is UTM tagging used? Benefit: UTM parameters enable tracking visitor performance in other analytics software, such as Google Analytics. The tagging can be done manually or automatically; the main point is that it should be done.

20. What attribution model is used? Benefit: Choosing a different attribution model can drastically change the interpretation of account performance. There are two types of conversions in Facebook: view conversions and click conversions. To get a more conversative view, include only the click conversions with a short attribution window (e.g., 1 day). To get a more rosy picture, include view conversions with a long attribution window (e.g., 28 days). There is no absolutely right or wrong attribution model.

21. Is dynamic advertising used? Benefits:

  • dynamic advertising can be used both in retargeting and in new customer acquisition
  • it offers wide range of options, if technical setup is made correctly, e.g., automated price promotions

22. Is advanced configuration of dynamic advertising used? Benefit: This is underused, yet highly potential feature of Facebook Ads — it enables to customize automatic advertising (e.g., prefer products with high gross margin, geographically show right products for right areas).

23. Are rules used for optimization? Benefit: Rules enable the monitoring and automatic response to business critical conditions (e.g., notification from data anomalies, adjusting budget based on results etc.).

24. Is the budget spent effectively? Benefit: Facebook Ads can waste budget, but there can also be much potential for upscaling the spend — based on performance metrics, one should analyze if the budget should be decrease/increased, what is the potential reach of target groups, how well are those target groups reached, and with what impression frequency.

25. What bid strategy is used? Benefit: A good account has tested several options, including: Lowest cost (standard), lowest cost with bid cap (risk of delivery issues), or Target cost (can be used for scaling up the budget).

Section C: Organic content

26. Is there enough quality content to be believable on the eyes of customers if they visit the Facebook page? Benefit: Visitors may want to check the quality of the page. Having little or no organic content creates mistrust.

27. How active are the Facebook followers of the page? Benefit: There can be a possibility to get insights from followers or turn their enthusiasm into more business. Engagement rate is a good metric, i.e. divide post responses by post impressions.

28. Is organic content reaching the target group? Benefit: If not, maybe it should be advertised. Many Facebook pages produce fairly good content that reaches nobody organically.

29. Is there point of focusing organic content or paid advertising? Benefit: The strategic roles of organic and paid should be addressed. What is the role of organic content? What is the role of paid advertising? Note: multiple ads can be advertised and A/B tested without publishing these on the news feed.

Section D: International aspect

30. Are the ads translated? When doing advertising to e.g. 10 countries with different languages, the ads should also be communicated in 10 different languages. Note that one country can contain multiple language groups, requiring localization even within a single country.

31. Is campaign structure supporting multiple languages? Each language should have been placed in separate target groups. For example, campaign could be name after the country, and it should contain different ad groups for each languages.

32. Is there enough budget to advertise internationally to all target groups? If you are targeting several countries, cities, and languages, these all need different budgets. In order to make impact, it is not usually wise to divide budget into too small pieces.

33. Is there other localization besides translation? Often, an error is made to assume localization is only about language. However, it is also about culture, customs, and ethnicity. For example, value propositions of communicated benefits may be entirely different when the same product is promoted to culturally different target groups (e.g., collectivity-individuality aspect might differ). Another example is that imagery matters for ethnic match between the target audience and people shown in the ads.

34. Have the country-basis legal restrictions been taken into consideration? E.g. different countries have different restrictions for promoting alcohol products, and European countries have strict orders for handling the data according to GDPR protocol.

35. How do normalized metrics vary by countries? Compare performance by normalized metrics (e.g., ROI), because that adjusts for variation between the markets. For example, Facebook Ads bids can be ten times more expensive in the US than in Vietnam. Similarly, purchase power differs so avg. conversion value can be one tenth in Vietnam, meaning that advertising would be equally profitable. To account for this, use normalized metrics, such as ROI or ROAS.

36. What are the city-level performance differences? Another common mistake is to assume that country is detailed enough segmentation criteria for performance differences. However, performance can vary greatly by city, e.g. in big countries like China or US. Moreover, rural areas can differ compared to city areas because people’s tastes, values, and behavior is different. To accommodate for this, Facebook advertisers should segment by city in addition to country (e.g., compare TOP 5 cities of each country).

37. What are the segment similarities across countries? Each impression has a cost. And each impression also adds information about customer responses. However, in the Facebook Ads account the performance values are siloed across different campaigns and ad sets. Therefore, to optimize such accounts, data needs to be combined. For example, if targeting 12 countries, the performance by demographic groups can be aggregated to give more statistical power (higher reliability for found similarities and differences).

Conclusion

This list of 37 items is a good starting point for analysing any Facebook Ads account running international campaigns. Besides these steps, Facebook account level data can be used for analysis purposes to find patterns in the data. For example, making country level breakdowns is made easy in the user interface of Facebook Ads platform.

About the authors:

Tommi Salenius is a Digital Marketing Manager at Elämyslahjat.fi, a Finnish e-commerce company that sells experience gifts. Tommi also works at Parcero Marketing Partners as a Lead Digital Marketing Strategist. www.tommisalenius.com

Joni Salminen is a Digital Marketing Manager at Elämyslahjat.fi, a Finnish e-commerce company selling experience gifts. Joni is also a board member at Konvertigo Digital Agency that runs digital marketing campaigns to over 100 countries. www.jonisalminen.com

How to identify useful user feedback? Three tips for value driven-user development

In our APG team (APG = Automatic Persona Generation), we have the goal of doing value-driven system development. “Value-driven” means that each feature we add or incorporate, solves a real user problem (i.e., provides real value). Since our clients are typically operating in the business domain, their problems deal with understanding their customers better. That’s the space APG operates in.

To discover real user needs, we’ve been carrying out several user studies about personas. However, there are many issues in conducting user studies. The feedback we get is not always relevant or valid.

For example, some participants might not be truly engaged or interested in the system and just participate out of duty or because they were “forced to”. Similarly, users may just brainstorm features that really they would not use but that “sound cool”.

Moreover, when compiling the feedback, we find that there are a lot of requests for new features. Say, the users want 10 new features, but we have time and resources for two and therefore need to prioritize.

Below, I’m sharing three principles we’ve developed in order to cope with these situations.

1. Who does the feeback come from? => not all people are engaged, motivated, or knowlegeable to give useful feedback. Therefore, we have to consider if a person is just “shooting ideas” or if he or she actually wants to provide useful feedback. We then prioritize the comments from the people whose feedback indicates they are taking the commenting more seriously.

2. How repetitive is the feedback? => if the request comes from many organizations and many people within an organization, it is more likely to be a real problem to solve. If it’s a rare request, the problem is probably also very rare and worthy to focus on.

3. Is the feedback traceable to a real problem the user has? => this question tries to clarify if the request if a nice-to-have or pain killer. We need to solve real problems with the system, so nice-to-haves need to be minimized. Even if many motivated people suggest a new feature, it could still be a nice-to-have if we cannot logically connect it to a real problem.

Conclusion

Nice-to-have features are like a disease; everything can be done, but only a few things are worth doing. With nice-to-have-features, the system will not have active usage. The goal of value-driven development is to develop a system that has real users that actively use it.

Therefore, focusing on distinguishing the most useful feedback from a lot of interviews, think-alouds and comments is crucial, especially for small teams and startups that are forced to focus their development efforts.

Automatic Analytics: Considerations for Building User-Oriented Data Analytics Systems

This is an unpublished exploratory study we wrote with Professor Jim Jansen for Machine Learning and Data Analytics Symposium (MLDAS2018), held in Doha, Qatar.

Change of landscape: For a long time, automation has been invading the field of marketing. Examples of marketing automation include the various scripts, rules, and software solutions that optimize pay-per-click spending, machine learning techniques utilized in targeting of display advertising (Google, 2017), automated tools that generate ad copy variations, and Web analytics platforms that automatically monitor the health of marketing performance, alerting the end users automatically in case of anomalies.

In particular, several steps of progress towards automating analytics insights are currently being made in the industry and research fronts of data analytics.

For example, there are several tools providing automated reporting functions (e.g., Google Analytics, TenScores, Quill Engage, etc.). While some of these tools require pre-configuration such as creating report templates, it is becoming more common that the tool itself chooses the relevant insights it wants to portray, and then delivers these insights to the decision makers, typically pinging via email. An example of such an approach is provided in Figure 1 that shows Quill Engage, a tool that automatically creates fluent text reports from Google Analytics data.

Figure 1: Quill Engage. The Tool Automatically Generates Fluent Reports From Google Analytics Data, And Provides Numerical Comparisons Based on Outliers And Trends.

As can be seen from Figure 1, the automatic analytics tool quickly displays key information and then aims to provide context to explain the trends in the key performance indicators.

Benefits: The benefits of automatic analytics are obvious. First of all, automation spares decision makers’ time, as they are not forced to log into systems, but receive the insights conveniently to their email inboxes and can rapidly take action. Since cognitive limitations (Tversky & Kahneman, 1974) are imposing serious constraints for decision makers dealing with ever-increasing amounts of “big data,” the need for smart tools that pre-process and mine the data at the user’s convenience are highly beneficial.

The core issue that automatic analytics is solving is complexity.

As a marketing manager, one has many platforms to manage and many campaigns to run within each platform. Multiple data sources, platforms, and metrics quickly introduce a degree of complexity that hinders effective processing of information by human beings, constrained by limitations of cognitive capacity.

In general, there are two primary use cases for business analytics: (1) deep analyses that provide strategic insights, and (2) day-to-day analyses that provide operational or tactical support. While one periodically needs to perform deep analyses on strategic matters, such as updating online marketing strategy, creating a new website structure, etc., the daily decisions cannot afford a thorough use of tens of reports and hundreds of potential metrics. That is why many reports and metrics are not used by decision makers in the industry at all.

The solution to this condition has to be automation: the systems have to direct human users’ attention toward noteworthy things. This means detecting anomalies on marketing performance, predicting their impact and presenting them in actionable format to decision makers, preferably by pinging them via email or other channels, such as SMS. The systems could even directly create tasks and push them to project management applications like Trello. A requisite to automatic analytics should therefore be the well-known SMART formula, meaning that Specific, Measurable, Appropriate, Realistic and Timely goals (Shahin & Mahbod, 2007). Through this principle, decision makers are able to rapidly turn insights into action.

Interfaces for automatic analytics: To accomplish the goal of automatic analytics, one trending area of is natural language systems, where users find the information by asking the system questions in free format. For example, previously, Google Analytics had a feature called Intelligence Events, which detected anomalies. Currently, Google provides automatic insights via a mobile app, in which the user can ask the system in natural language to provide information. An example of this is provided in Figure 2.

Figure 2: Screenshot from Google Analytics Android App, Showing the Functionality of Asking Questions From the Analytics System.

However, even asking the system requires effort and prior knowledge. For example, what if the question is not relevant or misses an important trend in the data? For such cases, the system must anticipate, and in fact analyze the data beforehand. This form of “intelligent anticipation” is a central feature in automatic analytics systems.

Examples: In the following, we provide some examples of current state-of-the-art tools of automatic analytics. We then generalize some principles and guidelines based on an overview of these tools.

First, in Figure 3, we present a screenshot from email sent by TenScores, a tool that automatically scans Quality Scores for Google AdWords campaigns.

Figure 3: TenScores, the Automatic Quality Score Monitoring Tool.

In search-engine advertising, Quality Scores are important because they influence the click prices paid by the advertisers (Jansen & Schuster, 2011; Salminen, 2009). In this particular case, the tool informs when there is a change in the average Quality Score of the account.

From a user experience perspective, the threshold to alerting the user is set to very low change, resulting in many emails sent to the users. This highlights the risk of automation becoming “spammy,” leading into losing user interest. The correct threshold should be set experimentally, e.g., according to open rates by experimenting with different increments of messaging frequency and impact thresholds.

In Figure 4, we can see a popular Finnish online marketplace, Tori.fi. Tori sends automatic emails to its corporate clients, showing how their listings have performed compared to previous period, and enabling the corporate clients to take direct action from within the email.

From example, one can click the blue button and the particularly listing which is not performing well, is boosted. In addition, there is a separate section (not visible from the screenshot) showing the best performing listings.

Figure 4: Tori’s Marketplace Insights Automatically Delivered to Inbox.

Risks: There are also risks associated with automatic analytics. For example, In search-engine advertising, brands are bidding against one another (Jansen & Schuster, 2011). Thus, an obvious step to further optimize their revenue by providing transparent auction information is Google sending automatic emails when the relative position (i.e., competitiveness) of a brand decreases, prompting advertisers to take action.

This potential scenario also raises questions about morality and ethics of automated analytics, especially in click auctions where the platform owners have an incentive to recommend actions that inflate click prices (Salminen, 2009). For example, in another online advertising platform, Bing Ads, the “Opportunities” feature gives suggestions marketers can implement in a click of a button. However, many of these suggestions relate to increasing the bid prices (see Figure 5).

Figure 5: An example of Bing Ads Recommending to Increase Keyword Bid.

If the default recommendation is always to raise bids, the feature does not add value to end user but might in fact destroy it. From an end user point of view, therefore, managers are encouraged to take recommendations with a grain of salt in such cases. From a research point of view, it is an interesting question to find out how much the automatic recommendations drive user actions.

Discussion: The current situation is that marketing optimization consist of various micro-tasks that are inter-connected and require analytics skills and creativity to be solved in an optimal way. The role of automated analytics, at least with the current maturity of technology, is pre-filtering this space of potential tasks into a number that is manageable to human decision makers, and, potentially, assigning the tasks priority according to their predicted performance impact.

In this scenario, humans are still needed to make the final decisions. The human decides which suggestions or insights to act upon. Nevertheless, the prospect of automatic filtering and sorting is highly beneficial in maneuvering the fragmented channel and campaign landscape taking place in practical online marketing work.

Practical guidelines:

  • As each vertical has its own KPIs, metrics and questions, there is a requirement of using many tools. For example, search-engine optimizers require drastically different information than display advertisers, and therefore it makes no sense to create a single solution. Instead, an organization should derive the tools from its business objectives and based on the specific information needed to achieve them.
  • An example of fine-grained automatic analytics is TenScores that only specializes on monitoring one metric in one channel (Quality Score in Google AdWords). Their approach makes sense because Quality Score is such an important metric for keyword advertisers and its optimization involves a complexity, enabling TenScores to provide in-depth recommendations that are valuable to end users.

However, even though the tools may be channel-specific, their operating principles can be similar. For example, stream filtering and anomaly detection algorithms are generalizable to many types of data, and thus have wide applicability. Moreover,

  • setting the frequency threshold to pinging decision makers is a key issue that should be experimented with when designing automatic analytics systems.

Even if there is automation, it is too early to speak of real artificial intelligence. The current systems always have manually set parameters and thresholds, and miss important things that are clear for individuals. For example, the previously shown Quill Engage cannot provide an explanation why the sales dropped when going from December to January — yet, this is apparent to any individual working in the gift business: Christmas season was the reason.

Implications for developers of automatic analytics systems: Developers of various analytics systems should no longer expect that their users log in to the system to browse reports. Instead, the critical information needs to be automatically mined and sent to decision makers in an actionable format (cf. SMART principle). There is already a considerable shift in the industry to this direction which will only be emphasized as customers realize the benefits of automatic analytics. Thus, we believe the future of analytics is more about detecting anomalies and opportunities, and giving decision makers easy choices to act upon. Of course, there are also new concerns in this environment, such as biased recommendations by online ad platforms – is the system advising you to increase bids because it maximizes your profit or because it increases the owner’s revenue?

Conclusion: Analytics software providers are planning to move toward the direction of providing automated insights, and researchers should follow suite. Open questions are many, especially relating to users’ interaction with automatic analytics insights: how responsive are users to the provided recommendation? What information do the users require? What actions do users take based on the information? We expect interesting studies in this field in the near future.

References

Google. (2017). Introducing Smart display campaigns. Retrieved February 12, 2018, from https://adwords.googleblog.com/2017/04/introducing-smart-display-campaigns.html

Jansen, B. J., & Schuster, S. (2011). Bidding on the buying funnel for sponsored search and keyword advertising. Journal of Electronic Commerce Research, 12(1), 1–18.

Lee, K.-C., Jalali, A., & Dasdan, A. (2013). Real Time Bid Optimization with Smooth Budget Delivery in Online Advertising. In Proceedings of the Seventh International Workshop on Data Mining for Online Advertising (p. 1:1–1:9). New York, NY, USA: ACM. https://doi.org/10.1145/2501040.2501979

Salminen, J. (2009). Power of Google: A study on online advertising exchange. Turku: Master’s thesis. Turku School of Economics.

Shahin, A., & Mahbod, M. A. (2007). Prioritization of key performance indicators: An integration of analytical hierarchy process and goal setting. International Journal of Productivity and Performance Management, 56(3), 226–240.

Tversky, A., & Kahneman, D. (1974). Judgment under uncertainty: Heuristics and biases. Science, 185(4157), 1124–1131.

How to write emails that get read? 11 tips I use daily.

Here are some tips to make people more likely to read your email.

I’ve noticed that some people struggle to communicate effectively via email, so maybe sharing these tips will help someone.

Tips:

1. include *one message* per email — when you include 2 or more, the others easily get ignored. It’s better to send a new message, like “ps. one more thing…”

2. don’t make people think why you move from A to B, but make it evident from the text. Like, make a logical argument that explains itself. Find supporting evidence when needed and be truthful to yourself.

3. use short sentences, short paragraphs — people are scanning so shortness sells.

4. use plain words, don’t make people think

5. use words and phrases that cannot be misunderstood

6. be personal, use people’s names to catch their attention

7. use bolding and lists to facilitate scanning — in text-only, use *asterisk symbols* to emphasize

8. include the next steps — too many emails end up in a limbo, like what should I do after reading it?

Moreover,

9. do the thinking for the reader, so it’s easy to take action. Sometimes this means writing a single email can take an hour or more.

10. include all the relevant people when forwarding or replying — maximum transparency, maximum information

11. however, when you want a specific response, send your message individually. For example, don’t send survey links as mass-posting; approach people personally.

Got more tips? Share!

Medieval Game of Death (#bisnesidea)

korttipeli, jossa yritetään selvitä keskiajan kylän läpi.

A

plague – a rat bites you and infests you with plague
death
guillotine
alchemist
mermaid
hellhound
inquisition
witchcraft
burning at stake
lonely knight
harlequin

B

map:
back alley
market place
castle
tavern
underworld
gates of heaven

A+B –> jokaisessa oma tarina

“travel through a medieval town and see if you can survive”

googleta: card game mechanics

1. throw a dice
2. take a card
3. ???

vrt. tallinn legends
–> samantyylinen kaveri vetämään videon äänispiikin

“No Startup Is an Island” – How to Use Network Pictures to Position Yourself in the Market

I got introduced to network pictures by Valtteri Kaartemo a few years back, and thought it was a cool idea. Since then, I’ve realized — after talking to many startups — that it’s more than a cool idea. It’s actually useful.

That’s because startups routinely overlook their networks and just focus on competitors. They make positioning to competitors, not to collaborators. This can be very detrimental to succeeding, because often the most connected startups do the best: they get the biggest investment rounds, biggest sales deals, etc. They are just liked more.

So you need to network. And using network pictures can help.

What is a network picture?

The idea of a network picture is that you draw your business as a network diagram (i.e., you in the middle as the central node, and other players linked to you as first- or second-degree nodes).

An example of a network picture (source: [1]):

The others in the picture can be any parties with a logical relation to your startup. They can be:

  • collaborators
  • customers
  • investors
  • suppliers/vendors
  • resellers/distributors
  • marketing/business development agencies
  • freelancers
  • friends and family
  • research institutes/universities
  • state departments
  • entreprenurship societies
  • corporations with venture programs
  • press/media
  • associations/non-profits.

They can be companies or individual people (e.g., influencers, decision makers, etc.).

Basically, those are the actors that your business interacts with (or should interact with). You are not an island.

How do use network pictures for your startup?

Now, the important thing is this: you first draw the current situation, and then the vision. I repeat,

1. Draw current situation

2. Draw vision

—

3. Compare the two

The point is that when drawing the vision, you automatically make apparent your desired state of mind which makes it easier to create a tangible plan for networking. It’s about making the vision explicit.

It also helps you consider possibilities that you had overlooked. Like, “Oh, we should check if the local university has any research projects that coincide with our product development roadmap“. Or, “We could meet up with the industry association people to ask if they find potential in our tech.” Things like that.

Through this process, you (hopefully) realize that you’re not an island, and that there many parties you could (and should) involve in your business at varying degrees of commitment. You can continue by analyzing the motives and win-wins that your connections to current and future parties entail. A good approach has been illustrated in [2]:

Conclusion

Often, business planning for startups focuses on competitors, but collaborators can be even more important. Start by drawing them, and then make the connections happen.

If you’re a startup founder and haven’t thought about the importance of networks, you should. There is research that shows networks and connections matter — and common sense supports this argument, too. You are acting in an ecosystem of other players. It’s the market, not your garage, that matters.

Footnotes:

[1] Kaartemo, V. (2013). Network development process of international new ventures in internet-enabled markets: service ecosystems approach (Doctoral dissertation). Turku School of Economics, Turku, Finland. Retrieved from http://tsenet.fi/wp-content/uploads/2013/11/network-development-process-of-international-new-ventures.pdf

[2] Valjakka T., Kaartemo V., Valkokari K. (2017) Making Sense of Network Dynamics through Network Picturing. In: Vesalainen J., Valkokari K., Hellström M. (eds) Practices for Network Management. Palgrave Macmillan, Cham

Use Cases for Personas

This is a joint piece by Dr. Joni Salminen and Professor Jim Jansen. The authors are working on a system for automatic persona generation at the Qatar Computing Research Institute. The system is available online at https://persona.qcri.org.

Introduction

Personas are fictive characterizations of the core audience or customers of a company, introduced into software development and marketing in the 1990s (see Jenkinson, 1994; Cooper, 1999). Personas capture and summarize key elements of key customer segments so that decision makers could better understand their audience or customers, not just by using numbers but also referring to qualitative attributes, such as key pain points and desires, needs and wants.

Out team refers to persona creation as “giving faces to data,” as personas are ideally based on real data on customer behavior.

Figure 1 shows an example of a data-driven persona in which the attributes are inferred automatically from social media data.

data-driven persona

Figure 1: Data-driven persona.

While personas have been argued to have many benefits in the academic literature (see e.g., Nielsen, 2004; Pruitt & Grudin, 2003; Salminen et al., 2017), we are constantly facing the same questions from new client organizations wishing to use our system for automatic persona generation (APG) (An et al., 2017).

Namely, they want to know how to use personas in practice. While we often make the analogy that personas are like any other analytics system, meaning that the use cases depend on the client’s information needs (i.e., what they want to know about the customers), this answer is still a bit puzzling to them.

For that reason, we decided to write this piece outlining some key use cases for personas. These are meant as examples, as the full range of use cases is much wider.

We will first explore some general use cases, and then proceed to elaborate on more specific persona use cases by different organizational units.

General Use Cases of Personas

In general, there are three main purposes personas serve:

1) Customer Insights. This deals with getting to know your core audience, users or customers better. For example, APG enables an organization to understand its audience’s topics of interest and preferred social media content. Who uses? Everyone in the organization.

2) Creation Activities. Using persona information to create better products, content, marketing communication, or other outputs. Who uses? Everyone in the organization dealing with customer-facing outputs.

3) Communication. Using personas for communication across departments. While it is difficult to discuss a spreadsheet, it is much easier to communicate about a person. Sharing the persona work across divisions thus increases the chance for realization of benefits. Personas make data communicable and keep team members focused on the customer needs. Who uses? Everyone in the organization.

Specific Use Cases of Personas

In addition to shared use cases of personas, there are more specific use cases. For example, product managers can use the information to design a product that meets the needs or desires of core customers, and marketing can use personas to craft messages that resonate. Here, we are outlining specific examples of use cases within organizational units. More specifically, we allocate these use cases under four sections.

1) Customer Insights and Reporting

Journey Mapping: Plot the stages and paths of the persona lifecycle, documenting each persona’s unique state of mind, needs and concerns at each stage. Understand your website visitors’ customer journey.

Persona Discovery: Document the individuals involved in the purchase process in a way that allows decision makers to empathize with them in a consistent way.

Brand Discovery: Uncover how your core customers feel about your product or service and how they rationalize their purchase decisions.

Reporting and Feedback: Report and review data and insights to drive strategic decisions, as well as provide information to the organization as a whole.

2) Creation Activities

Planning Product Offerings: With the help of personas, organizations can more easily build the features that suit their customers’ needs. Consider the goals, desires, and limitations of core customers to guide feature, interface, and design choices.

Role Playing: Personas help product developers “get into character” and understand the circumstances of their users. They facilitate genuine understanding of the thoughts, feelings, and behaviors of core customers. Individuals have a natural tendency to relate to other humans, and it’s important to tap into this trait when making design and product development choices.

Content Creation: Content creators can leverage personas for delivery of content that will be most relevant and useful to their audience. When planning for content, we might ask “Would Jamal understand this?” or “Would Jamal be attracted by this?”

Personas help one determine what kind of content is needed to resonate with core customers and in which tone or style to deliver the content. Naturally, customer analytics can and should be used to verify the results.

3) Persona Experimentation

Channel and Offering Alignment: Align every piece of offerings and marketing activity to a persona and purchase stage, identifying new channels and needs where opportunities exist.

Prediction of Popularity: Predict how a given persona will react to content, marketing messages, or products. This is a particular advantage of data-driven personas that enable using the underlying topical interests of the persona to model the likely match between personas and a given content unit.

Experimentation and Optimization: Carry out well-thought experiments with personas to produce statistically valid business insights and apply the results to optimize performance. For example, you could run Facebook Ads campaigns targeting segments corresponding to the core personas and analyze whether the campaigns perform better than broader or other customer segments.

4) Strategic Decision Making

Strategic Marketing: When you understand where your core customers spend their time online, you are able to focus your marketing spend on these channels. For example, if the data shows that your core customers prefer YouTube over Facebook, you can increase your marketing spend in the former.

Think how you might describe your product for this particular type of person. For example, would Bridget better understand your offering as a “social media service” or as an “enterprise customer management tool”? Depending on the answer, the communicative strategy would be different.

Sales Strategies: Targeted offerings can help organizations convert more potential customers to subscribers, followers and customers. You can also use personas to tailor lead generation strategies which is likely to improve your lead quality and performance. By approaching your messages from a human perspective, you can create sales and marketing communication that is tailored to your core customers and, therefore, is likely to perform better.

Executives: Key decision makers can keep personas in mind while making strategic decisions. In fact, a persona can become a “silent member in the boardroom,” evoked to question the customer impact of the considered decisions.

Examples for the APG system

In the following, we will include some use case examples from the APG system that generates personas automatically from online analytics and social media data. The system is currently fully functional, and we are accepting a limited number of new clients with free of charge research licenses. See the end of this post for more details.

persona listing

Figure 2: This functionality enables the client to generate personas from his chosen data source (currently, following platforms are supported: YouTube, Facebook, Google Analytics). The client can choose between 5 and 15 personas.

persona profiles

Figure 3: The persona profile shows detailed information about the persona. It enables human-oriented customer insights.

Figure 4: This feature enables an easy comparison of the personas across their key attributes. Improves understanding of the core customer segments.

Figure 5: This feature shows which personas most often react with which individual content.

Figure 6: This feature shows how the interests and other information of the personas change over time. Currently, APG generates new personas on a monthly basis.

Figure 7: This feature enables a gap analysis of the current audience and potential audience. The statistics are retrieved from actual audience data of the organization and the corresponding Facebook audience (via Facebook Marketing API).

Conclusion

Forrester Research (2010) reports a 20% productivity improvement with teams that use personas. Yet, using personas is not always straight-forward. Ultimately, the exact use cases depend on the client’s information needs. These needs can best be found by collaborating with persona creators to provide tailored personas that are useful specifically for a given organization in their practical decision making.

Through means of “co-creation,” clients and persona creators can figure out together how the personas could be useful for real usage scenarios. According to our experience, useful questions for defining the client’s information needs include:

  • What are your objectives for content creation / marketing?
  • What kind of customer-related decisions you make?
  • What kind of customer information you need?
  • What analytics information are you currently using?
  • What kind of customer-related questions you don’t currently get good answers to?
  • How would you use personas in your own work?
  • What information you find useful in the persona mockup?
  • What information is missing from the persona mockup?

If you are interested in the possibilities of automatic persona generation for your organization, don’t hesitate to contact us! Professor Jim Jansen will gladly provide more information: [email protected]. However, please note that for automatic persona generation to be useful for your organization, you need to have at least hundreds (preferably thousands) of content pieces published online with a wide audience viewing them. APG is great at summarizing complex audiences, but if you don’t have enough data, persona generation is better done via manual methods.

References

An, J., Haewoon, K., & Jansen, B. J. (2017). Personas for Content Creators via Decomposed Aggregate Audience Statistics. In Proceedings of Advances in Social Network Analysis and Mining (ASONAM 2017). http://www.bernardjjansen.com/uploads/2/4/1/8/24188166/jansen_personas_asonam2017.pdf

Cooper, A. (1999). The Inmates Are Running the Asylum: Why High Tech Products Drive Us Crazy and How to Restore the Sanity (1 edition). Indianapolis, IN: Sams – Pearson Education.

Forrester Research. (2010). The ROI Of Personas. Retrieved from https://www.forrester.com/report/The+ROI+Of+Personas/-/E-RES55359

Jenkinson, A. (1994). Beyond segmentation. Journal of Targeting, Measurement and Analysis for Marketing, 3(1), 60–72.

Nielsen, L. (2004). Engaging personas and narrative scenarios (Vol. 17). Samfundslitteratur. Retrieved from http://personas.dk/wp-content/samlet-udgave-til-load.pdf

Pruitt, J., & Grudin, J. (2003). Personas: Practice and Theory. In Proceedings of the 2003 Conference on Designing for User Experiences (pp. 1–15). New York, NY, USA: ACM.

Salminen, J., Sercan, Ş., Haewoon, K., Jansen, B. J., An, J., Jung, S., Vieweg, S., and Harrell, F. (2017). Generating Cultural Personas from Social Data: A Perspective of Middle Eastern Users. In Proceedings of The Fourth International Symposium on Social Networks Analysis, Management and Security (SNAMS-2017). Prague, Czech Republic. Available at http://www.bernardjjansen.com/uploads/2/4/1/8/24188166/jansen_mena_personas2017.pdf