Marketing organizations are on a quest to become more data-driven. As a result, they use, on average, about 16 different technology platforms—but only a few organizations reap the full value of their investment.
What's more, the most recent CMOSurvey.org study predicts analytics will consume 19% of Marketing's budget by 2021. About another 22% of the budget will go to technology. Together, those two investments will account for nearly 50% of Marketing's budget.
Yet, the CMOSurvey.org study reports that only about one-third of marketing organizations use analytics to make program or strategic decisions. And less than 20% of respondents reported that the use of analytics made a significant contribution to company performance.
Despite those increases in investment and advances in technology, "marketers are still challenged to maximize the potential value of analytics," according to the most recent CMOSurvey.org study.
Tom Davenport and Jeanne Harris, in their classic book, Competing on Analytics: The New Science of Winning, provided a road map for becoming an analytical competitor and using analytics to create value and growth—the purview of Marketing.
Marketers should learn to use analytics to address at least five growth opportunities:
- Acquisition of more valuable customers
- Acquisition of customers who will buy more from you
- Acquisition of customers who will buy more of your high-value products/services
- Retention of high-value customers
- Identification of marketing activities that have the greatest impact on accelerating customer acquisition and improving retention
Move these four analytics capabilities to the top of your list
For a decade, we've known what it takes to fuel growth with analytics. Yet four recurring themes account for the majority of the challenges continuing to thwart the progress of all organizations, including Marketing, regarding analytics:
- Lack of quality data
- Lack of people (that is, the number of people needed to perform the work)
- Lack of skills (the current talent doesn't have the necessary skills to perform the work)
- Lack of predictive tools (despite all the technology that is in play, there is still a high need for predictive tools)