With the advances in technology and the rise of digital media, consumers generate massive amounts of information about their behaviour, needs and wants that, at first glance, could sound like the perfect solution for marketers.
Indeed, the importance of using data for informed decision-making is evident. As shown in this week’s academic reading “Performance implications of deploying marketing analytics”, most firms will improve their performance if deploying marketing analytics, especially in those industries in which competition is high, and consumer needs and wants are constantly changing. Furthermore, with the birth of digital marketing, businesses can measure almost everything they do. Using digital analytics has become essential to figure out which digital strategies are working and which not and to track progress over time. Also, it provides powerful customer insights to enhance segmentation, build loyalty, improve customer service, among others.
Nevertheless, even though companies are investing in digital analytics, many are still struggling to get meaningful or actionable insights for their business decisions. So if digital data is so important, why are businesses still failing to get value from it?
There are different answers for this question found in the different industry and research articles. The following are my thoughts about it:
- Lack of expertise. Presence across numerous digital platforms, enable businesses to extract tonnes of raw and unstructured data that needs to be standardised, organised and understood so it can be used in a meaningful way to get insights. Of course, some tools can help with this, but it is also important to have the adequate human resources. It seems that sometimes companies either hire part-time employees to manage their digital media efforts or just simply do not have the right people with the necessary skills to analyse the data.
- An absence of a well-structured plan that defines what exactly wants to be achieved from every digital marketing initiative and, as the digital marketing evangelist Avinash Kaushik points out, a lack of measurable, well-defined objectives with their corresponding KPI’s and set targets. When there is not a clear purpose for analysing the data, there will not be clarity either of what data would be more important to analyse and how to use that data to create meaningful digital programs.
Finally, data is not the ultimate solution for all marketing problems and decisions should not be entirely based on data insights. For instance, Steve Jobs was known for making critical decisions at Apple based solely on his instinct and understanding of the consumer. Of course, this example is more the exception than the rule but shows that sometimes data might not be enough.
So yes, in this digital era where businesses seem to be drowning in data, it is important to have the appropriate skills and people to draw out meaningful insights, which should always be used along with marketing knowledge, experience and the so-called “marketing gut”.