The Importance of Analytics for Today’s Marketers
By Daniel Kehrer
Today's "measurement mandate" for marketing has brought analytics front and center. As that happens, it's important to be clear on what analytics are all about. For example, they're not just a way to gauge effectiveness of past events. Analytics technology today can do far more, accurately predicting future results, connecting online and offline touch points and elevating marketing from an "expense" to an investment with clear and quantifiable results.
A good working definition for analytics might be this: "The scientific process of transforming data into insight for making better decisions."
For marketing organizations, analytics are no longer a nice-to-have they're a must-have. Realizing they need more analytical "horsepower" under the hood, today's top marketers are moving quickly to adopt analytics technology to measure impact and optimize investments. This new horsepower includes such things as advanced predictive analytics, multi-channel attribution, authoritative identify methodologies, sophisticated segmentation, precision targeting, TV attribution, accurate data onboarding at scale and much more.
Taking Analytics to New Levels
Investing in analytics is only a start. As companies expand analytics programs, they can be more effective by assessing how their efforts stack up against industry standards and best practices.
Best in class marketers, for example, are deploying analytics to grow revenue and achieve better results across a broad spectrum of business goals. They are figuring out how to embed analytics throughout their organizations and have realized that analytics aren't just something the quants do inside a digital bubble.
Instead, they see analytics as a strategic process of instilling a data-driven mindset inside the entire marketing organization and activating that mindset to improve the speed and effectiveness of everything marketing does.
Marketers can't simply toss the analytical football across the isle to the internal quants or a siloed analytics group. They need to "walk the talk," learning how to translate the language of analytics into insights that marketing can deploy to generate real business outcomes – with greater speed, agility and accuracy.
The payoff potential is huge. Leading organizations are finding that fully integrated advanced analytics and precision marketing approaches can improve marketing effectiveness by 15-30% – in effect freeing up an equivalent portion of their budgets to invest in other marketing activities or contribute to bottom-line profit.
Gaining Marketing Analytics Maturity Over Time
Marketing analytics have been a strategic differentiator and competitive advantage for many successful companies in recent years, helping drive growth superior to industry peers. But analytics acumen doesn't happen overnight. It evolves over time as the organization gains maturity in marketing measurement.
It often starts with basic analytical tools and limited data availability, and moves up the scale of maturity as sponsorship grows, adoption spreads and the marketing team becomes more adept at connecting investments to revenue, predicting future outcomes and optimizing investments across all channels.
Marketing organizations that have achieved the highest levels of measurement maturity are able to generate a consistent view of customers across all touch points – both digital and offline – and deliver consistent, precision-targeted messages.
As more companies install marketing analytics, however, they will begin catching up to those that started earlier. To stay ahead, those that already have high analytics IQs are becoming increasingly adept at applying analytics to more and more situations. They are pushing further into the realm of "advanced" analytics and are embedding it across their organizations to support a growing roster of audiences, activities and decision-making activities.
Advanced analytics can help you:
- Measure both online and offline marketing activities, and include short- and long-term impact.
- Factor in non-marketing components as well (e.g. weather, unemployment, competitive activity, etc.) across short- and long-term time ranges.
- Integrate accurate and predictive multi-channel attribution with traditional marketing mix modeling.
- Show marketing's contribution to revenue.
- Simulate future periods and course correct in real time.
- Plan and spend budgets more confidently.
- Align digital and offline spending.
- Quantify the impact of non-media components such as events, sponsorships, website, product, price, inventory, customer service and others.
- Predict customer behavior.
- Improve programmatic effectiveness.
- Become a more customer-centric organization.
A New Strategic Necessity
Gaining expertise in marketing analytics is a strategic necessity that recognizes, among other things, how consumer behavior has changed. For example, today's buying process – for both B2B and B2C marketers – is far more fluid, multi-channel and filled with numerous touch points and "moments of influence."
The rapid evolution of advanced analytics has turned many marketing organizations into technology pioneers and strategic innovators. The best have recognized the value that data, analytic, segmentation, identity and targeting technologies can have for their companies.
Yet huge differences remain between companies in their familiarity with analytics tools and techniques, as well as their ability to implement them for better decision-making. Such differences place companies into a scale of "measurement maturity" that ranges from those in learning mode to organizations that have developed mastery of analytics and are using it in transformative ways.
As always, there are opportunities in such developmental disparity. Companies that know where they stand and are able to move quickly up the scale of analytics maturity will have a clear edge over those that don't.
Change Continues to Accelerate
Meanwhile, the pace of change will likely accelerate over the next several years as marketing analytics technology becomes even more refined, accurate and predictive, and marketers ramp up efforts to deploy it to show the value of marketing and improve effectiveness.
Unless your organization is prepared to take the necessary steps to instill a data-driven mentality and implement processes that can translate valuable insights into decision actions, you may fall short of realizing the technology's true potential.
Inaction can be costly. Analytics can help you eliminate wasteful spending, make faster course corrections and optimize every marketing dollar.
With the right analytics strategy and technology in place, you can measure what really matters, act predictively and make better decisions across a broad range of business investments.
Source
"The Importance of Analytics for Today's Marketers." ANA Data Analytics Center, 9/15/17.