Experimental design: A new tool for marketers

Companies spend huge sums on direct marketing to acquire or retain customers through email, direct mail, catalogues and other tactics. Yet the return on investment is often poor. Many organisations still use the traditional champion challenger approach, also called A/B testing, to test new offers, because it is relatively easy to execute.

However, it has limitations: Only a few offers can be tested at a time and the variance is low so regression results are not meaningful. But thanks to recent advances in analytics, leading marketers now have a far more powerful technique called experimental design, says a Bain customer strategy & marketing brief, 'Act now! Triple your direct marketing effectiveness.' The method allows marketers to increase the variables tested in a single campaign (product offers, messages, mail formats and so on) and to test multiple offers in the market simultaneously. Marketers learn exactly which variables entice consumers to act. As a result, response rates rise, the campaigns' effectiveness improve. The report says such multivariate marketing campaigns increase consumer response rates by three to eight times, adding hundreds of millions of dollars to the top and bottom lines.

The skill-gap is real
A new Accenture survey shows that executives know a skills gap persists in their organisations and that it threatens their competitiveness. Skills gaps have become more prevalent across most industries. To overcome this, executives are investing more in their people's ongoing training so that workforces will have the skills their companies need in the coming years, finds Accenture 2013 Skills and Employment Trends Survey: Perspectives on Training.

According to the research, nearly half of those surveyed confirm they do not have the skills they need to compete effectively in the coming years. Not surprisingly, few are looking to cut the size of their workforce anytime soon: Almost two-thirds expect their full-time employee headcount to remain the same.

Skills in greatest demand are in IT (44 per cent) and engineering (36 per cent), with R&D (29 per cent) and sales (29 per cent) close behind. Many companies are also looking for leadership, communications and people management capabilities. But the No. 1 impact of skill gap on the company is the employee performance and productivity. The report found that 87 per cent of believe that a skill gap increases stress on existing employees. This is a major concern of executives as it impacts productivity.