Marketers are emerging from the worries associated with the fiscal cliff to increasingly embrace the value of data analysis to hone efforts to target customers for goods and services.
In fact, nearly two-fifths (38.7%) of marketers and suppliers say they spent more on data-driven marketing in the first quarter of 2013 than they did in the fourth quarter of last year, according to the Direct Marketing Association’s (DMA) Quarterly Business Review survey.
While 42% have held spending at the same level this quarter compared to last, more than 70% agree that data-driven marketing is poised for growth.
“When you compare the sentiments of this group coming out of the back half of 2012 – facing the fiscal cliff and sequestration – with their optimism for 2013, people are absolutely bullish about the opportunities,” says Jonathon Margulies, managing director of Winterberry Group, which conducts the quarterly reviews for the DMA.
In addition, the survey finds that the Data-Driven Marketing Index – derived by asking respondents to rate their interests in pursuing technology solutions on a scale of 1 to 5 – grew from 3.1 at the end of 2012 to 3.31 during the first quarter of this year.
“We’re seeing the mandate going out from senior managements to build big data strategies for their companies, and marketers are going to be at the center of that movement,” Margulies says. “They are being recognized as the emergent group with respect to digital information. Marketing is going to be the source of intelligence in the organization, the group that owns the customers.”
Additionally, big data represents a turning point for how companies can generate insights about their customers to fine-tune marketing, says Victoria Zagorsky, consumer insights manager at Citibank.
She notes that there are six themes that should top the agenda for any company aiming to leverage data analysis for deeper customer insight:
Market researchers need to evolve. Instead of focusing solely on data collection, market researchers will need to explore a variety of existing data sets.
Break silos. “An emphasis should be placed on cultivating data-driven culture and promoting data sharing. Organizations should also integrate research functions with analytics groups and foster collaboration between the two in order to facilitate data synthesis and analysis,” Zagorsky says.
Invest in infrastructure and human intelligence. Technology investment is important so that managers can access and use customer information.
“However, data on its own has very limited value, and without skills to interpret data, an organization has a risk of becoming data rich but insight poor,” she adds. “Human intelligence is needed to attach context and translate raw numbers into insight to tell a story that will help business achieve its objectives. It is therefore critical to develop data competence skills.”
Put quality first. While many aspects of market research have evolved to meet the needs of big data, the need for quality data has remained the same. “And while the responsibility for the quality of data in research programs lies primarily with the research teams, managing the quality of big data requires an organization-wide commitment and coordinated efforts of diverse business units,” according to Zagorsky.
Avoid scope creep: Define clear objectives. “Due to the abundance and variety of the data, it may be difficult to decide which data sources to use and how to synthesize data effectively to generate actionable insights,” she notes. “For example, to develop an effective customer retention program, retail banks may explore a variety of data sources including transactional information across multiple channels, web-tracking data, social media, voice recordings, correspondence and survey findings.”
Companies that aim to analyze all available data are doomed to fail, Zagorsky adds.
Focus on business impact. Zagorsky notes that despite the well-documented explosion of the available data, the additional insights gleaned from the analysis have not yet mirrored that growth.
“Finding the story behind the numbers and delivering meaningful insights requires an adequate understanding of customers, market and wider business context,” she says. “To maximize ROI, it is also critical to communicate insights effectively and to collaborate with internal stakeholders to translate findings into action plans to help business achieve its objectives.”
- Subscribe to our blog to stay up to date on the latest insights in data analysis, big data and big data analytics.
- Please join us on Wednesday, July 17th at 11 a.m. EDT for our complimentary webcast, “Combining Paid & Organic, Social & Earned Media Data to Drive Deeper Insights with Spotfire,” presented by Benjamin Spiegel, Director of Search Operations, Catalyst and Ben McGraw, Director of Industry Solutions, TIBCO Spotfire. In this webcast, Spiegel will explore a variety of search data and demonstrate how Spotfire can be used to build illustrative dashboards, drive insights, and refine paid and organic recommendations for more effective content strategies.