#2. Establish formal programs for evaluating marketing analytics.

While the findings discussed in previous blog entries suggest many opportunities for capability development, I will focus on four that I believe are particularly powerful and salient, starting with those that are more specific, tangible and short-term and proceeding to those that are more long-term and more organizational and philosophical. Below is the second of these items in this 4 part series.

It's unusual that, while many companies have formal programs for evaluating and grading their marketing partners and agencies, they lack similar protocol for their marketing investments and marketing analytics. And it is especially surprising when one considers the many reports and case studies demonstrating the significant benefits of marketing analytics when properly deployed. Additionally, without formal evaluation programs in place, marketers will continue to struggle to integrate and leverage new forms of marketing. Not only would such analytic efforts pay for themselves many times over, but without them, companies are throwing money away.

In a future blog, I will outline more completely what a formal Marketing Analytics Evaluation Program would entail, how it might be deployed and the potential benefits. Today I will cover some of the basics.

Most importantly, an Analytics Evaluation Program would start by assessing the impact of the analytics. This exercise would include at least two dimensions.

First, are marketing analytics informing and influencing actual decisions? As I covered in a previous blog, analytics currently impacts less than a third of decisions – a number that has been decreasing over the past 5 years, the supposed heyday of big data and predictive analytics. Any evaluation efforts would start by understanding the percent of marketing decisions that analytics were influencing as well as the nature of those decisions (what types of decisions, when not used – why not?, etc.)

Second, are those analytics (and the decisions they drive) having a significant impact on brand objectives and consumers along the consumer journey? The nature of the metrics impacted could vary widely depending on brand objectives and circumstances. A potential list of key outcomes could include any and/or all the following:

Exposure (e.g., reach, frequency, level of engagement, etc.)
Communications (e.g., ad recall, ad awareness, branded awareness, etc.)
Effectiveness (e.g., incremental lift, ROI, penetration/trial, effective repeat, basket size, price elasticity, etc.)
Brand perceptions (e.g., awareness, salience, equity, attributes, emotions, motivations, etc.)

A comprehensive program should be able to demonstrate and quantify the value of marketing analytics recommendations of those key metrics and how they improved pre- and post-recommendations.

After understanding the impact, the next step is to diagnose the various organizational and process elements that support a successful marketing analytics program. I will cover these elements in more depth later, but here is a preliminary view of what elements should be examined:

  • Cadence
  • Are analytics updated frequently? Are they delivered in time to answer ongoing business questions? Are they conducted frequently enough to stay current?
    • Analytic Talent and Culture
  • How sophisticated is the analytic team? Does it include both data and modeling experts? Does it have a blend of analytics and business skills?
  • Beyond analytic team, how up-to-speed are marketing people with analytic outputs? Are they able to interpret and leverage them in their programs?
  • Does management expect them to provide analytic rationale for their recommendations? Are promotions contingent on analytic familiarity or expertise?
  • Are business partners (e.g., finance, product development, external agencies) similarly integrated into the process?
    • Methodological expertise
  • How does the team keep abreast of on-going data and methodological innovation?
  • Do you have a standard set of methodological requirements for key methodologies?
    • Integration with business processes
  • Are business processes and inputs constructed with analytics in mind?
  • Does timing of analytic projects/work coincide and complement business planning processes?
    • Communication protocols
  • How does your team optimize the delivery of findings and recommendations to marketers?
  • Is story-telling an expected part of the process?
  • How well-versed is the analytic team in data visualization?
    • Capability development and training
  • Do you have formal programs around analytics? Both specialized for analytic teams and more general/actionable for broader teams?
    • Success tracking
  • Do you track the value of analytic recommendations? Do you track the value of analytics implemented?
  • Do you build case studies to help with training and help bring analytic practices to life?

  • Companies that employ regular analytics evaluation and optimization can expect to achieve significant benefits, from both short-term recommendations and value capture to longer-term creation of an analytic culture.

    Please check back later this week when I'll be publishing "Killer Idea #3" - and for additional background on "Navigating Unchartered Waters" please ensure you peruse our previous Chalkboard content!



    #1: RETHINK HOW YOU TEACH AND INSTILL MARKETING KNOWLEDGE & CAPABILITIES, SHORT- AND LONG-TERM Marketers' ability to effectively leverage social media, mobile and analytics is a microcosm (albeit a significant one) of the broader issue of how a c