Marketing analytics is a rapidly developing practice that has grown out of the convergence of three key industries:
- Business Intelligence Industry – Primarily software tools that enable new methodologies and the development and sharing of graphical business measurements.
- Performance Management Industry – Change agents focused on productivity and quality improvements in business processes.
- Database Marketing Industry – Marketers using customer databases and analytics to grow revenues and profits in highly measurable ways.
Getting Everyone on the Same Page
The starting point for all marketing should be benchmarking and then tracking results against those benchmarks. The very best marketing measurement practices we see today are designed around the Marketing Dashboard Concept. Dashboard measurement systems are designed to cascade down an organization – with corporate strategy guiding which metrics are measured at the top level, and subsequent managers providing metrics from their individual areas that are rolled-up into the top level reports.
Unfortunately, for many companies, metrics and measurements don’t cascade from the top – in fact, they typically work in the opposite way – being built from the ground up and passed upwards. The result is a wide range of different reporting formats, the measurement of different Key Performance Indicators and different definitions for metrics even within the same channel and department. Much of these differences are caused by performance data coming from disparate sources with different toolsets and very different skill sets bringing data together.
Organizations usually want to be able to compare the results of the various marketing efforts they use to create demand. Although some of the best web analytics tools highlight the ability to line up conversion data across media, in most cases the different media are still managed in different silos, and reporting tools for them are tough to integrate — it is rare to see successful side-by-side comparisons of different types of media – e.g., the effect of direct mail vs. paid search advertising.
It’s tough not to fall in love with tools that promise gorgeous consolidated dashboards that will clearly make you a fast tracker. However, the really hard work comes from getting the data together in the first place, and generating initial insights that can drive toward agreement on the most important metrics to track. For example, we’ve seen ongoing angst over the following critical questions:
- How important is it to track customer value? How do you measure it?
- What is the definition of “conversion”? Can the definition be maintained across marketing silos?
- What are the key segments to keep track of? How are they defined?
- Are Acquisition or Retention metrics more important?
We find over and over that a data integration process coupled with a customer insights and profiling exercise are critical path milestones that really ought to PRECEDE any efforts at dashboarding. But with these first steps, building to a consolidated marketing measurement and analytics strategy can follow relatively easily – and a tools decision can be a logical and practical outcome.
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