In 2016, analytics tools are so readily available that marketing teams have no excuse for not using them to gauge the success of their campaigns. Without analytics, they’re basically operating blind.
Many companies have already recognized this. In the February 2016 edition of a biennial survey of chief marketing officers, 66% said they planned to increase analytics spending over the next three years. However, this investment is for the birds if analytics are not being used correctly - as appears to be the case. In the annual Duke CMO Survey, 65% of respondents said that they lack the ability to really measure marketing impact accurately, a number that needs to change.
In this article, we look at what companies need to be doing to ensure that their marketing analytics investment is not wasted.
For a marketing department to effectively use analytics, everyone needs access. This helps eliminate data bottlenecks that can arise from staff being overwhelmed with requests for reporting support, and enables staff to collaborate to best understand the data and leverage it for insights. Data needs to be readily available to marketers whenever they need it, so they can test any ideas they may have. For example, if a marketer has a hypothesis that wind breaks are likely to sell better during Spring, they should be able to check for a correlation from captured data easily. Data visualization tools mean that marketers do not necessarily need a great understanding of how to interpret data, but they do need a good awareness of its uses, and an idea of how to make sense of it.
Look To The Future
In a recent survey of 308 CMOs and business unit directors by Forbes Insights, ‘The Predictive Journey: 2015 Survey on Predictive Marketing Strategies’, 86% of executives with experience in predictive analytics said they believe the technology has delivered a positive return on investment for their business. However, while 73% of marketing analytics reported that they evaluate past and present data, just 27% goes on predicting and influencing the future. Predictive analytics allows marketers to accurately target the best possible prospects with the most compelling offers, and those that look only at the past are missing out on sizeable profits.
What To Look For
According to a VentureBeat report, 40% of marketers look primarily at audience insights, with growth and conversion tracking lagging behind. Cross platform marketing (attribution), customer experience, and Big Data were also under-represented in the user interviews, indicating the marketers are failing to build a complete picture of what is working for them, and what will work.
In order to make full use of data, marketers need to know what they should be looking at to measure campaign success. Isolated engagement metrics like conversion rates ignore the downstream business impact and often do not provide a complete picture. Glamour metrics like Facebook likes might make you feel good, but they rarely correlate to revenue.
Market size analytics is one of the most important things to look at. Establishing how large the market is for your products and services is done by looking at how many units are sold, the amount of money spent in that market, and the frequency of sales. Market trend analytics is also useful in understanding the growth potential for a product, or whether the market is stagnant or in decline.
Analytics should also be used to determine which channels are the best to push promotional materials through. Marketers need to know which ones are not translating into engagement and sales, where they should concentrate their efforts, and what they can do to to improve conversion rates.