Monetization: Understanding what drives value in the digital channel

By Erik Koto | 0 Comments | Posted in in Analytics | Permalink

Ask a room full of digital marketers what “Monetization” means and you’ll get a lot of responses. For some, it’s a reporting metric; for others, it means better merchandising and high conversion rates; for still others, it’s figuring out how to make any money at all from a website (Twitter anyone?).  At ZAAZ, we have our own take on monetization – one we think is critical for all digital marketers:
 
Monetization modeling is the analysis of consumer behaviors across the digital channel to understand how different behaviors create business value.  

To explain this approach, it’s important to understand some key terms:

 

‘Behaviors’

Behaviors are the building blocks of the monetization model.  When we engage in monetization modeling, we start by analyzing discrete user interactions, or behaviors.   For example, with a consumer products company, we’ll analyze how product videos, comparison tools and social media, such as ratings and reviews, will influence the customers purchasing decision.  By understanding value at a “behavior” level, we can immediately create actionable recommendations on content strategy.
 
’Across the digital channel’

Your website is part of a much broader digital ecosystem, one that is increasingly populated with content about your brand that you don’t control.  Social media, or earned media, has permanently changed the digital landscape and has a tremendous capability to create—or destroy—value for your business. Understanding your customers’ social interactions, and how they affect value, is crucial to a comprehensive digital strategy. Additionally, monetization modeling can be scaled to include bought media (PPC, display, etc.).  Our best clients use monetization as a key input to media analysis and decision-making.
 
’Analysis’

Great insights into consumer behavior don’t happen on a whiteboard. User research and advanced analytics are the foundation of monetization modeling.  And let’s face it: what we’re talking about is complex and represents a big shift in thinking for many organizations.  The best way to make the transition from “gut-feel decision-making" to "data-driven decision-making” is by using robust analytics and by having confidence in the findings.  
 
‘Business value’

Traditional reporting metrics such as site visits, downloads or media impressions are fine, but what do those behaviors mean in terms of business value? This is where monetization modeling can turn data into action. The goal of monetization is to go beyond merely counting and reporting clicks. Our analysis is designed to specifically isolate how different interactions drive revenue, profits or cost savings for the business. It is these insights that we use to inform digital marketing, which brings us to objective of monetization.
 
The objective of monetization is to design more effective websites, media campaigns and social media outreach.

The insights we gain from monetization underpin many of the programs we manage.  Whether it’s developing an ROI-focused optimization program, recommending site architecture changes, seeding high-value social content, or optimizing bought media based on value generated instead of CTR, monetization is fundamental to our performance-driven culture.  

Our primary job at ZAAZ is to improve the efficiency with which the digital channel delivers business value. Monetization is the common language we use to understand value and the data-driven approach that allows us to consistently deliver high ROI programs.