Partner Spotlight: It’s Good to Be LeROI

An interview with Marc Preusche, data nerd extraordinaire, about the makeup of an ideal optimization team, using data to make smarter decisions and the looming tower of Amazon's entry into the media world.

Marc Preusche is the consummate data and optimization nerd. The euphoria you feel when your favorite football team scores a late equalizer is the rush he gets when he opens a perfectly personalized email newsletter. While you dream of beachside mai tais, his REM cycles contain a fair amount of digital analytics and tag management.

After a lengthy stint at Google, Marc founded LeROI, a consultancy dedicated to helping people use data to make smarter decisions. We caught up with Marc to geek out about customer centricity, the rise of Amazon as a media player and the ideal makeup of an optimization “squad.”

DY: At Dynamic Yield’s “Personalization Pioneers” summit you audaciously claimed to a room of eCommerce leaders that none of their companies were truly customer-centric. What did you mean by that?

MP: To understand true user-centricity, we have to look at companies like Google, Facebook, and Amazon. Unlike most eCommerce companies who are obsessed with their direct competitors, I find it fascinating how the world’s top tech titans take a different approach.

Amazon and Facebook are not trying to stay ahead of the competition- they’re trying to stay ahead of the user. They realize that the user is the final frontier. Most companies aren’t customer-centric because they don’t look at the user heavily enough. In practice, this means not nearly enough attention to web analytics, CRM data and other direct signals from the end user. And without these key data points, there can’t be any real effort to make sure the experience for the end user is fun.

This is why so many millennials are staying away from traditional brands today- they’re downright bored.

DY: Speaking of the big boys in tech, is the Google/Facebook advertising duopoly soon to become a triumvirate with the addition of Amazon?

MP: You better believe it. For all the data they hold, one thing that both Google and Facebook are often missing is transactional data. Meanwhile, Amazon has become masterful at using its own set of data about ACTUAL PURCHASE behavior which is far more valuable to marketers than clicks.

Five years ago, there was a fascinating and creepy case study where Target correctly predicted a woman was pregnant based on her purchase pattern before she had any idea. This is the kind of power Amazon has. Amazon can get into consumers’ lives way more deeply than the Googles and Facebooks of the world.

Already Google is fighting with the fact that the first place most consumers go for any product-related search isn’t Google, it’s Amazon! There are billions and billions of dollars that are Amazon’s for the taking in this market.

DY: As a former Google guy and AdWords expert, why am I probably doing wrong in my AdWords efforts?

MP: You’re probably busy uttering my favorite phrase: “that keyword doesn’t work for us”

Fundamentally, this is an attribution problem. Companies need to start thinking of attribution in terms of the entire customer journey, rather than intensely focusing in on the channel that drives the end conversion.

Let’s say you are a furniture retailer and someone does a query for a new armoire after moving to your neighborhood. Even if someone finds your website through an AdWords campaign, this a big purchase and it is unlikely she will buy in that session. Down the road, too many brands will forget the initial session came as a result of SEM and will attribute the conversion to brand ad or some kind of targeted offer.

Don’t just look at the keyword performance in a straight-line conversion vacuum without looking at your overall strategy or you’ll risk being inundated by statistical outliers.

DY: On the topic of channels, which medium is the market underinvesting in? Where are marketers spending too much?

MP: From the broadest perspective, there is a massive investment of tools but not nearly enough spending on proper usage. People ask me all the time if they can make a large platform investment and get by with devoting roughly 1/4 of an FTE (full-time employee) to manage the tool. No! Either do it right or don’t do it at all.

There are so many websites that have 80+ tracking tools. No chance that most of these are being used the right way. Essentially, companies are spending bucketloads to do nothing but slow the performance on their sites and cause massive data leakage.

All this spending on tools leads to a massive underinvestment in understanding the user from a qualitative and quantitative perspective. Not nearly enough TIME is spent trying to understand customers and tailoring efforts towards that, which ironically is the end goal of most of the expensive equipment marketers are buying.

For the sake of all that is good, spend more in synchronizing your efforts for the user. There are too many ads there that are the equivalent of asking someone to marry you on the first date. Understand your user’s stage in the purchase funnel and tailor the experience accordingly.

Finally, it’s time to stop looking at performance marketing as the holy grail of growth. In startups, the proper positioning and brand are heavily under-represented. When I look at the top start-ups, most of them are not growing that much through performance marketing, they are growing through building a phenomenal brand and customer experience.

DY: You’ve worked with and advised some of the best companies in the world on optimization. What do you think is the ideal makeup of an agile optimization team?

MP: The ideal makeup is to think of it like a squad that is not based on the “usual” functions. The team should be based on skills, not titles and mirror the different stages of the customer journey.

A common objection I hear to setting up a CRO group this way is that “these people sit on different teams.” Well, guess what- the user doesn’t give a shit about your internal teams. They care about themselves and getting a relevant experience.

Finally, I think these teams should be led by a new role that I call “chief marketing technologist,” whose raison d’etre is to help a company use marketing technology to craft better experiences for users.

(P.S. If you want read further, be sure to check out our free book on Amazon.)