Thursday, March 12, 2009

Defining Optimization

Optimization by itself is an immensely ambiguous term, yet it has reached a buzz-worthy crescendo among marketers and IT professionals alike. By the simplest definition, optimization is the process of making something better. To optimize a process is to improve upon it. Thus if something is optimized, then presumably it’s as good as it gets. However, as the term optimization flutters around business applications, the meaning becomes diluted and often times abstract. So much so, that someone recently described a conversation to me regarding optimizing where both parties were in vehement agreement with dramatic headshaking and belabored guffaws…But the dialogue abruptly ceased when they discovered that they were each conceptualizing an entirely different manifestation of optimization. So how could this happen?

Consider that optimization has been around for quite some time and despite the common misconception of late that optimization is a technology – rather, it is a process that is aided by technology. Further, the process of optimization can be applied in myriad forms. Take for example, revenue optimization, fulfillment optimization, call center optimization, pricing optimization, search engine optimization, channel optimization, marketing mix optimization…and the list goes on. Pretty much any noun (or combination thereof) imaginable can precede the term optimization and presto, you’ve got a something new to optimize.

Yet, the circles I run in, and most likely yours too (since you’re reading this blog) are most often referring to marketing optimization. Some may call it online optimization – or perhaps, business optimization, but these descriptors really don’t help us to narrow the field of optimization possibilities. So I propose more descriptive language to identify the optimization process which a marketer is attempting to improve.

Let’s break down the category of Marketing Optimization into components that are easily understood and clearly defined such that individuals can take responsibility for each piece. I’ll offer a few examples of online marketing that I believe can benefit from optimization:

  • Interaction Optimization – the real-time dialogue between a visitor and an online channel (Web, email, chat)
  • Search Engine Optimization – the process of associating keywords to content
  • Site Optimization – improving the navigation, flow or design of a Web site
  • Ad optimization – targeting or tailoring advertising (placement and message) to attract a specific audience
  • Contact optimization – identifying the appropriate frequency and timing of a customer contact strategy
  • Channel Optimization – determining the most appropriate channel to deliver a message, product or service
  • Marketing Mix Optimization – which combination of marketing programs lead to the most profitable outcomes

While these distinctions still barely scratch the surface of defining the entire gamut of marketing optimization possibilities, the next time someone throws out the term optimization looking to cash in on the buzz, ask them to describe precisely what they’re talking about optimizing.

On the second thought, a buzzword or topic often gets even more hyped when there’s some mystique or uncertainty involved. Just look at how well Web 2.0 did in that regard. So, if you’re betting on optimization as your meal ticket…maybe ambiguity is your plan?

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