Anomaly Detection in Marketing: Ultimate Guide & Best Practices

In this article, we will introduce anomaly detection and explain how it can benefit your marketing team. If you’re a data-driven marketer, a data analyst, a CMO, a product manager, or just interested in marketing analytics trends, we hope this article will provide all the answers to your questions when it comes to anomaly detection in marketing.

Today's world generates more data than ever before. Many marketers may be caught in the grip of analysis paralysis in the coming decade. As marketing programs consume more data, the data sources may become dispersed or duplicative, leading to uncertainty about the information they contain. 

Growth teams are drowning in siloed data but starving for meaningful insights and next-best actions. It is critical for the growth teams to quickly extract meaningful information from colossal marketing data sets to make accurate, timely, and effective decisions. 

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Anomaly detection has been an active research area for several decades, with early exploration dating back to the 1960s. Anomalies are data patterns that do not follow well-defined criteria of normal behavior. Anomaly detection or outlier detection is the discovery of things, events, or observations in data that do not conform to an expected pattern or other items.

Anomaly finds deviations from an established regular pattern. Spotting an anomaly depends on the ability to define what normality is. Once the norm is established, it becomes easy to determine what the anomaly is.

Businesses collect massive amounts of data as part of their marketing analytics pipeline. Anomaly detection is the approach of employing machine learning capabilities to analyze your marketing data and provide teams with more actionable insights. Without proper anomaly detection and timely response, the consequences for growth marketing teams may be expensive.

Augmented Analytics solutions powered by AI and ML algorithms tackle marketing challenges with robust anomaly detection capabilities. Most marketing teams are capturing only a fraction of the potential value from data. Anomaly detection allows them to discover hidden issues and provide critical intelligence to maximize performance.

Real-time anomaly detection makes it easy for marketers to predict trends and intervene quickly if needed. Raw data is filtered by an algorithm and presented in the form of natural language narratives. Anomaly detection systems enable alerts that humans can quickly understand and make data-driven decisions.

1. The typical marketer spends eight hours a week studying data if you don't have a data analytics team dedicated to monitoring marketing metrics. They can better use their time to create strategic and innovative campaigns.
2. If you have a data analytics team, they simply analyze data, calculate, and visualize marketing stats for C-level executives. Instead of working on new initiatives to keep your business ahead of the competition these valuable resources are wasted.
3. Manual marketing metrics tracking overlooks critical anomalies and trends. Out of hundreds of marketing metrics, you can track manually only a few. This limited analysis leaves up to 60% of the data unavailable for analytics.
4. Not all marketing metrics are created equal. While some metrics will have a more significant impact on revenue, you may miss out on other critical metrics by focusing only on the ones you see as the most essential. Manual marketing metrics monitoring may overlook revenue-damaging glitches instead of proactively discovering and resolving them.
5. Google Analytics and other legacy solutions offer useful alert features that notify you when your marketing metrics critically change. This helps you keep track of several metrics at the same time. The alerts, however, are based on static data, while nothing in marketing is ever static.
6. Various moving marketing components include campaigns, channels, pricing, and seasonal changes. You will either get overwhelmed by too many static alerts or waste valuable time changing parameters.

Let’s look at a few real-world examples of anomalies in marketing demonstrating how anomaly detection can uncover hard-to-spot anomalies and exploit hidden marketing opportunities. Marketing teams must be proactive rather than reactive, incorporating data anomaly detection and advanced analytics in everyday operations. 

Marketers use a variety of tools to track our key metrics, including Google Ads, Facebook Ads, Google Analytics, and many more. These complex datasets both contain hundreds of general patterns indicating “business as usual”— and some values that stand out. Anomaly detection capability suggests that something has gone wrong or that an unexpected positive result has been achieved.

• An increase in the cost per click (CPC) of a campaign;
• A lower CTR than expected;
• A change in the SEO performance of the webpages;
• A target audience or area performing significantly better or worse than normal;
• Unusually low visitors to a web page, suggesting something has broken;
• Single sessions change;
• Page exits increased;
• Landing page visits decreased;
• User engagement metrics lowered.

Also, metrics and KPIs analyses are often retrospective, showing last month's results against the goal. With data-driven insights and anomaly detection, growth teams can build actionable analytics, allowing them to identify and address potential issues before they arise.

Anomaly detection features help analyze massive amounts of data 24/7 from multiple data sources at high speed and alert marketers on issues before they escalate.

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Analyzing the data to unveil insights is a massive effort for most growth teams. Marketers juggle thousands of metrics, including complex customer journeys across various acquisition channels, user behavior analytics data, multiple revenue streams, and more add up to large amounts of valuable but raw data. Anomaly detection is capable of doing high-performance activities outside of a human skill level.

Let's not fall into the trap of stereotype thinking. Not all anomalies are bad. In marketing, an anomaly can mean that something remarkable has happened and you achieved better-than-expected campaign results. The success may show up as an anomaly in your data, but it's an indication you're doing something right. Anomaly detection may help you discover opportunities to improve conversions and revenue.

Good or bad data issues need to be identified and reported with anomaly detection capabilities to understand what problems exist or what works exceptionally well. In marketing, you can’t simply ignore anomalies that don't meet your expectations.

Anomaly detection can help you achieve peace of mind by removing repeatable manual analysis activities if you are looking for ways to tame your ever-growing marketing data.  Let’s see what you or your team can achieve with anomaly detection:

• Identify and fix gaps and problems before they become a headache;
• Identify unusual patterns in your website traffic;
• Spot issues within your advertising campaigns and marketing assets performance;
• Identify unusual or deviant behavior in a monitored metric over time;
• Identify the highest converting customers;
• Improve conversions on new marketing campaigns;
• Streamline better product launches;
• Improve customer retention and loyalty;
• Measure historical expenses and other key metrics to improve future decision-making;
• Improve app performance;
• Deliver better product quality;
• Detect anomalies in real-time and take immediate actions;
• Detect anomalies in performance metrics and revenue changes;
• Conversions from an entire domain or a specific content asset;
• Find critical changes in channels, sources, pages that drive traffic.

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Anomaly detection helps supercharge and scale multi-channel marketing programs, delivering immediate and actionable insights to inform marketing decisions.

Narrative BI helps monitor, prioritize, and manage all critical marketing performance metrics across various data sets to identify trends and anomalies. Advanced anomaly detection features help you cut through the confusion in Google Analytics and take proper actions to respond on time. 

Google makes hundreds of algorithm updates every year: Panda, Penguin, Hummingbird, Pigeon, RankBrain, Mobile, Fred, Medic, BERT, just to name a few! The technology and reasons behind the algorithm updates are kept secret, however, the changes appear like natural calamities for marketers — they are hard to understand and manage.

Not every change impacts organic metrics, but some may affect a site's visibility in a SERP, affecting everything from traffic to keywords. Anomaly detection features help unlock hidden insights by automatically discovering trends and traffic changes, suspicious or radical changes in user behavior, reducing the time otherwise spent manually looking for them.

The most common application of anomaly detection for marketing is campaigns optimization. 

Marketing teams track performance metrics across many data sets to identify trends and anomalies when running PPC campaigns. They test multiple audiences channels, creative assets, calls to action, copy, and the list goes on.

Anomaly detection helps cut through the confusion without such complex and lengthy experiments, providing immediate, actionable insights to inform marketing decisions. Timely detection of positive and negative trends and outcomes helps perfect the marketing program.

Anomaly detection across your current campaign data provides you with more detailed analysis, discovers issues early, and allows you to improve initial targeting and budget allocation. Anomaly detection capabilities offer practical insights for an accurate real-time view of expenses vs. budget. You can continuously check and fine-tune expenses to get the most out of your budget.

Anomaly detection helps reduce uncertainty on how much to spend on each marketing channel to get the best overall return. Take advantage of intelligent machine learning based on unbiased historical intelligence to proactively show you how to adjust the budget to support your best-performing channels.

Growth teams put much effort into transforming digital content into tangible results such as traffic, customer acquisition, engagement, and revenue streams.

Don't limit conversion rate optimization to design, content, and technical website enhancements. Deep dive into the reason behind employing AI-driven anomaly detection to get the most of your data and capitalize on trends as they surface.

Anomaly detection helps boost content engagement across all digital channels, highlighting essential customer interactions. It surfaces the essential data right in front of you, addressing marketing intelligence issues as they arise.

Customer behavior patterns change quickly. With social media anomaly detection, you can stay up with market trends and acquire a competitive edge. It's tough to monitor social media 24/7 manually. However, real-time anomaly detection systems alert you to unexpected positive or negative product buzz. Rapid response to encouraging social media activity increases conversion rates and revenue.

Today’s marketing ecosystem is very multi-disciplinary. Teams include marketing professionals, business analysts, data scientists, software developers, and multiple business stakeholders. In today’s world of information overload, a key driver of success is communication.

Vilfredo Pareto, a political economist, presented his findings on the distribution of wealth in society well over a century ago. The Pareto Principle states that a small number of inputs (20% of inputs) directly affect a large number of outcomes (80% of outputs).

One anecdote says that a craftsman uses just 20% of his tools to accomplish 80% of the job. This also applies to us, marketers using analytics. On average, we only employ one or two analysis models or metrics for the vast majority of our use cases (the Pareto Principle in action!).

Suppose your marketing technology stack lacks a self-service advanced analytics platform with powerful anomaly detection features. In that case, you are not maximizing the value of your data and the advantages it may bring to your company.

We need to recognize that there are ‘many useful but just a few valuable insights' (the Pareto Principle) and apply this to reduce the amount of information we share. Narrative BI offers anomaly detection, a powerful tool for your marketing arsenal. We extract only valuable insights, helping cut through the metrics jungle, declutter, and optimize operations.

Narrative BI Platform is a lightweight, no-code, user-friendly, scalable, and cost-effective BI solution that tackles these issues. By enhancing Google Analytics native capabilities with sophisticated anomaly detection tools, the Narrative BI platform enables marketing professionals to respond faster and maintain a competitive edge.

Narrative BI enables the automated visualization and transformation of raw marketing data into valuable and shared insights, crafted in an easy-to-understand natural language.

Narrative BI is your single point of truth; no matter the amount of Google Analytics data processed, we help you justify opinions with facts.

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