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Evan Wood, SVP of marketing and custom services, Environics Analytics.
As we near the end of the calendar year, there’s no better time to look back and reflect on past accomplishments and challenges, while also looking forward and aspiring to new heights. This applies equally to one’s personal life as it does to one’s professional calling, including the realm of marketing at the most senior levels.
According to Forbes magazine, the average tenure of chief marketing officers (CMOs) has increased to 48 months in 2013, double 2004’s average length. This increase has been largely attributed to CMOs’ ability to leverage digital and analytics to create value for their business, according to global executive search firm Spencer Stuart.
To that end and in the spirit of encouraging this momentum, I thought this would be an opportune time to imagine what today’s CMO might have on their data and analytics wishlist heading into 2016.
Take data-driven insight to the next level
According to a recent report from VB Insight, 80% of consumer-facing companies don’t understand their customers beyond basic demographics and purchase history. In an environment of disruption and content overload, where superior customer experience is an imperative, this lack of insight is unacceptable. CMO’s must drive more actionable intelligence from both their own internal data and other sources that can fill the gaps.
Focus marketing on measurement and ROI
To be a modern marketer, you have to love data, be relentless in measuring your initiatives, and be laser-focused on evaluating your return on investment. Every person on your marketing team must have a strong foundation in establishing relevant metrics and be able to conduct even a basic ROI analysis.
Hire for data and analytics fluency
Training can help bring some core skills up to the required level. However, establishing hiring parameters that specifically look for these competencies will ensure that new recruits come with both qualitative and quantitative abilities—the necessary combination in today’s data-intensive marketing environment.
Challenge your agency to be more data-driven
Data-driven insight needs to permeate all aspects of the creative process, from the creative brief to execution. With the availability of granular intelligence on consumers—including demographics, marketplace behaviour, attitudes and social values down to a postal code level—agencies need to embrace this knowledge and reflect it in their deliverables.
Leverage the small data
For all its media coverage and almost mythical status, Big Data has been—in many cases—more of a distraction than a solution for organizations. The attention paid to the potential windfall of harnessing Big Data has been at the expense of a more practical focus on leveraging organizations’ existing structured data. Following the adage of “learning to walk before you run,” the CMO must fully understand the data assets that are more readily available for analysis and more likely relevant to achieving objectives in the shorter term.
Plan for data quality
In data and analytics circles, there’s a saying: “You’re only as good as the quality of your data.” Since marketing increasingly relies on data for customer segmentation, targeting and messaging relevance, the CMO needs to take the lead role in ensuring the appropriate policies, protocols and resources are in place that drive data collection, quality, completeness and availability. If you haven’t done a data quality evaluation, it should top your must-do list in 2016.
Insist on proper governance
Customer data will arguably be one of the top assets an organization will possess going forward. Beyond data quality, however, an organization must manage and use data in the best interest of the customer. This requirement includes not only privacy and security considerations, but rules on who can access the information and how it is can be used to create a better customer experience. Though governance will generally fall in the legal domain within most organizations, every marketer should be aware of the general aspects of such a policy.
Move from diagnostic to predictive analytics
It is estimated that 80% of marketing analytics today fall in the diagnostic category. That is, they provide a rearview mirror perspective on what happened in a particular situation (e.g. promotion response) and at best, point to why it happened. While diagnostic analytics are a critical building block to any business intelligence practice, leveraging this foundation for more predictive opportunities can deliver an exponential return. Models that deal with customer lifetime value (CLV), customer churn, next-best-product, channel optimization, optimal product mix and site locations are just a few examples of predictive analytics applications that CMOs need to evaluate to scale their data-driven efforts.
Use both in-house and outsourced resources
The decision to enhance your analytics capabilities cannot be reduced to choosing between building in-house capabilities versus tapping outside resources, but there must be a balance between the two. Unless your company is an Amazon, Google or Walmart, you will probably need to optimize your analytics “center of excellence” by building your team of database analysts, data scientists and strategists while accessing secondary and tertiary sources of valuable data to enhance your own. As you build your analytics roadmap, take heed of the African proverb, “If you want to travel fast, go alone; if you want travel far, go together.”
Secure the required budget
Working within defined parameters, like a budget, is second-nature to marketers. At the same time, you want to ensure that you’re not setting yourself or your organization up for failure by not investing in proper data and analytics. According to a 2015 Harvard Business Review survey of CMOs, organizations are currently spending just 6.7% of their budgets on analytics and expect to spend only 11.1% over the next three years. Other studies peg the investment significantly higher. Regardless, the fact is that, as the senior marketing executive, the CMO needs to champion the cause and ensure it is funded to deliver results.
The CMO’s tenure may indeed have risen dramatically over the last decade, but so have the expectations associated with the role. With increased pressure to transform marketing from a cost centre to a revenue generator, the job of the marketer is far from easy. An intentional and structured approach to leveraging data and analytics will go a long way toward helping attain these objectives. And no matter whether you’ve been naughty or nice this year, your 2016 will be that much better if you check this list twice over the holidays and in the months ahead.
Evan Wood is the senior vice-president of marketing and custom services at Environics Analytics
