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E-Metrics
E-Metrics
Business Metrics For The New Economy
http://www.netgen.com/emetrics/ Copyright 2000, NetGenesis Corp.© 2000 NetGenesis Corp.
InfraMetrics, InfraMarketing,NetAnalysis, CartSmarts,NetInstrument, and theThe Start of Smart aretrademarks of NetGenesis.
NetGenesis Corp. Target Marketing150 CambridgePark Drive 211 East Victoria, Suite ECambridge, MA 02140-2322 Santa Barbara, CA 93101Tel: 617.665.9200 Tel: 805.965.3184Fax 617.665.9299 Fax 805.965.8687Copyright 2w0w00w,. nNeettgGene.nceosmis Corp. http://www.netgen.com/emetrics/ www.targeting.comE-Metrics
E-Metrics
Business Metrics For The New Economy
Executive Summary
Driven by the clear need for precise, informative indicators of e-business success,NetGenesis and Target Marketing conducted extensive interviews with seniorexecutives from leading Web sites to uncover current best practices in e-businessmeasurement. This research revealed that while all e-business managers clearlyrecognize the tremendous value of e-customer analytics, most lack the staff, techni-cal resources, and expertise to harness and put to effective use the flood of raw dataproduced by their Web systems.
By correlating these research conclusions with the online customer life cycle model,this paper offers the first set of ‘e-metrics’ aimed at providing Web site managersnew, fundamental insights into their e-business. New e-metrics introduced include thePersonalization Index, Stickiness, Seducible Moments, the Freshness Factor, andmore.
This document covers three major areas:
n Sections 1-3 explore the challenges facing today’s e-businesses, how metricsare critical to business success, and discusses the research methodology.
n Sections 4-8 present the research results and conclusions, introduce thecustomer life cycle, and explain each stage of this life cycle in-depth.
n Sections 9-13 offer an innovative set of readily applicable, useful e-metrics(including appropriate mathematical formulas), discuss the ramifications ofthese metrics, and provide recommendations for e-businesses looking torealize significant competitive advantages and cost savings through theapplication of these e-metrics.
Additional e-metrics information, references, and discussion forums are also availableon the NetGenesis Web site at http://www.netgen.com/emetrics/.
http://www.netgen.com/emetrics/ Copyright 2000, NetGenesis Corp.Table of Contents
Section 1: Introduction......................................................................1Background 1Major Research Findings 2Enter E-Metrics 2We Dedicate This Report to You 3
Section 2: Traditional Business, E-Business, and Metrics........................5Traditional Business Metrics 5E-Business Is Fundamentally Different 6Brick-and-Mortar Metrics are Growing Up 8
Section 3: E-Metrics: The New Breed..................................................10Research Methodology 11Survey Participants 12
Section 4: Industry Interviews: The Technology..................................15Standard Definitions of Core Measurements 15The Primary Measurements 17The Real-Time Horizon 19Taking Action 20
Section 5: Industry Interviews: The Human Equation...........................21A Call for Help 21Lack of Skilled People & Technical Resources 21Data Deluge 22Worth the Trouble 23E-Metrics: The Future Value is Compelling 25
Section 6: The Customer Life Cycle..................................................26Tracking the Customer Life Cycle 26Reach 27Acquisition 28Conversion 28Retention 29Loyalty 31
Section 7: The Life Cycle Interrupted................................................34Abandonment 34Attrition 35Churn 35
Copyright 2000, NetGenesis Corp. http://www.netgen.com/emetrics/E-Metrics
Section 8: Best Customer Metrics.....................................................36Recency 36Frequency 37Monetary Value 38Duration 38Yield 39
Section 9: Promotion Calculations.....................................................40Acquisition Cost 40Cost Per Conversion 40Net Yield 41Connect Rate 41Delivering on the Promise of the Customer Life Cycle 42
Section 10: Measuring the Successful Life Cycle................................43Life Cycle Pipeline 43Determining ROI Metrics 44The Customer Life Cycle Funnel 45Optimal Site Path 45
Section 11: E-Metrics & E-Customer Behavior.................................... [download for more]
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