There’s Math In Marketing… I swear
by Abby Gruber, Contributing Writer
I remember the day that I came home from the University of Wisconsin – Milwaukee and announced to my parents that I had picked my major. At UWM, a liberal arts school, the “business” degree was not specific enough, one had to pick from the six concentrations offered by our business school. I still see the look on my father’s face as his sense of satisfaction, knowing, his daughter was going into the business world completely changed with one word. Marketing.
A long conversation followed as he tried to convince me that Finance or Accounting would be more suited to my analytical and math mind. Marketing? That is for artists, dreamers. It’s the easy business course. With all love and respect possible, I refrained from responding, but in my head, I laughed.
What I love about marketing is that it is full of math, but it is math that you can see in real world applications on a daily basis. For example, my marketing text books were filled with equations calculating the marketing growth, the growth rate, market share, cost, price elasticity and other such calculations. Most of these are simple calculations taking some number and dividing it by another number, but they become metrics for success. But again, just because a text book told me this is real, it doesn’t actually mean anything.
So let’s flash forward to today. I work in the Marketing department of Experian Interactive Media (soon to be called Ybrant Digital), an advertising company. Every single decision made by our marketing team comes from a flurry of information generated, translated back, and interpreted (dun dun dun, using math).
We maintain a pivot to decide what creates the most revenue for the company. For example, we know how much it costs us to display every ad that we publish, with each ad containing a sign up form. We also know how many people see that ad (an impression), click on the ad (inquiry), and finally, how many people complete the form (converted lead). For each ad we take these numbers and manipulate them until we know which ad is best performing. Our department’s success is measured on how we use these metrics to tweak our ads performance.
Don’t just take my word for it. Daniel Mason recently started a blog called Math + Marketing, which is dedicated to bridging the current gap between math and marketing.
Market research is one of the best examples to look at how practical math influences marketing decisions. In a nutshell, a market research analyst will compile and analyze information about either a potential or actual customer base and see how they respond to companies and their products and services. This can be done through focus groups, surveys, and using previously gathered information. Once all the information is gathered, someone needs to make some sense out it.
So what do market researchers do with the information that they gather? In school, we had this cool market research software called SPSS, which believe it or not, they actually use in the real world too. And I know I’m about to blow your mind, but this software does the same stuff that my statistics software did. What?!?! Did she just say STATISTICS?!?! Yes, in fact, I did. SPSS measures relationships between answers to various questions and qualifications (e.g. If she marked she was female, she was more likely to have had a high interest in shoes) as well as variance, and other more complex concepts.
When we were younger, we all heard our parents say that math was practical. You can use it in the real world. But I’m sure when you were sitting in your high school class talking about simple ratios, that you never thought you would be able to execute an entire campaign based on conversion rates using that simple, basic, principles of division.
The use of math in Marketing is not just practical, it is essential. Math helps us make real decisions based on evidence, and not just on what our gut is telling us. The more we marketing professionals accept math as a driving component in our industry, the more integrity our decisions will display. Most importantly, we will see measurable results.
Abigail Gruber is a Marketing Optimization Systems Product Manager at Experian Interactive Media. She has a degree in Business Administration, Marketing from the University of Wisconsin, Milwaukee. Abby currently resides in Los Angeles, CA. When not busy crunching numbers she enjoys martial arts, hiking, anything at the beach, and learning new things.
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