Winning marketers use more data

For 5 years now, we have been trying to find out what the most important ingredients for growth are. How should marketing be organised for brand growth and which challenges will marketers face in the coming years? Science gives us insights and helps us in this search, but the best insights come from practice. For this reason, we conduct an annual survey among marketers, this year on a larger scale than ever. 2,000 marketers from 10 European countries participated, making the study one of the largest marketing surveys in Europe. Earlier research showed that the enormous amount of data available is the thing that keeps marketers up at night. Thus, how best to use this data to make decisions was the “ingredient” that we studied in more detail this year.

Data-Driven Decisions: A prerequisite for success!

The increasing availability and application of data are seen as the most impactful development for the coming years. 72% of all marketers place these developments within marketing at the top of the list. In addition, 51% of marketers think that the importance of data-driven decision making (DDDM) will further increase in the future (the rest think that the importance will remain the same).

And what is perhaps the most important finding of the study is the differences between the best-performing companies and the companies that perform less well. Never in the last 5 years have we seen such a big difference in this analysis. Well-performing companies are clearly more data-driven and see an important role for marketing in this. Data-driven decision making is not hype but has a major impact on the success of brands.

What do marketers face?

So, data is important for future success, but the research also shows that the growing availability and accessibility of data makes it more complex for marketers. But why? We asked marketers about the biggest challenges when it comes to data. The results are shown in the figure below.

Figure 1 Challenges in data

Big challenges are not in time and budget, but in organising and analysing data: it is about having the right people, the right tools and being able to prioritise the data. This has been explored in many of the vision interviews we have had with CMOs and Insight Managers. Christoph Urban, Marketing Director at Deezer summed it up nicely: “Data can only be as good as the people who make the decisions with it.” He says two interesting things here. The first is that the value of data is limited to the extent that you have people in place who can extract value from it. Secondly, data is only as good as the people who make the decisions with it. When you think about marketing and the decisions within marketing, it is not just about the Insights and Analytics teams or the research firm you work with, but it’s also a call to marketers to know and learn more about data themselves. Another important outcome of the vision interviews was that you can only use data successfully if you start with the right question. And this question is formulated by the marketeer!

Data-Driven is a process that starts with a commitment

Based on the patterns in the data, it became very clear that an obvious phasing can be seen among companies. We see that there are phases in the development: the start, the use, and the deepening. We also call this last phase the expert phase, and only 27% of all companies are already at that level. We see that more than half (54%) of the companies are already using data but are not yet as advanced in their application.
Commitment is crucial for a company to get real value out of data. The greatest benefit is not achieved in the step from starter to user, but from user to expert. If we look at the decisions in which data is used, we see that experts use data for all long-term and short-term decisions. From pricing and brand strategy to the introduction of new products or services, distribution, creatives, and media deployment. Winners are committed and apply data to every decision.

Figure 2 Only experts use data for all decisions

This means that, as a company, you should not decide to support a decision with data, but you should start using data in all decisions. The companies that do this also appear to be growing significantly faster. We also see this clearly among the experts, who all indicate that they can use even more data to optimise their decisions even further.

Integrate and keep it simple

Once decided to use data for all decisions, the second necessary condition is to integrate data. The figure below clearly shows how much more data is integrated among successful companies. It is also noteworthy that only 25% of all companies are already doing this.

Figure 3 Winners integrate more data

And it is precisely at this point that many organisations drop the ball. When integrating data, you often fall into topics such as ‘econometric modelling’ and ‘time-series regression analysis’. A complex subject matter, and therefore, for many marketers, a far cry from their daily practice. But it turns out that the winners not only use complex statistical models but also make extensive use of descriptive statistics. Frequencies, time, number of orders and delivery time, winners combine different data sources in simple graphs. For example, by placing the weighted distribution in the same graph as brand awareness, it immediately becomes clear where growth can be achieved (mentally or physically). It is not rocket science, but these simple analyses can be very impactful. An old maxim applies when it comes to output: keep it short and simple.

What are the winning ingredients?

In summary, “data-driven marketing” is certainly not hype; it has become an important part of marketing and an “ingredient” that differentiates winning companies. Just over a quarter of companies embrace data and use it for all marketing decisions. But it takes more than just setting up a data department.

The most important constraint is still the people. Using data only makes sense if the right question is asked and if the data can be converted into information and a decision. Too many dashboards and too much data paralyse the organisation rather than help it. Therefore, it is important to ask yourself which insights are needed for which decisions with every dashboard.

Another major problem in organisations is data silos. Data is never isolated and must be integrated. Combining data provides immediate insight and the biggest advice that can be given is ‘less is more’. However, this does not apply to the amount of data, but the complexity of the analysis. Simply placing two data sources in a graph often yields more than the complex ‘marketing models’ that many marketers are not trained in.