Some time ago I wrote a post about the importance of analysts for online businesses. At that point I was moving into a new role where I was given the opportunity to build an offering of my own and I knew that I would make analytics the core.
After meeting Neeraj Sharma who works with Badgeville I realised I wasn’t alone in my understanding that behaviour is the key to understanding user engagement and holds the answers to hitting key business objectives.
This is a joint post we’ve curated in response to an article that went up on the We Are Social blog following a survey run by McKinsey Global. The results are quite alarming. You would ‘assume’ in a world where digital technology is at the forefront of all marketing activity, that brands and their employees would be actively embracing the opportunity to get a deeper understanding of their consumers and really work out what makes them tick. You know what they say about assumption though. Let me breakdown some of the excerpts in said article.
“less than a quarter of those surveyed are using analytical tools to refine their decision-making processes, even though 39% have increased access to data and insights. This reflects an important imbalance: while companies believe that social media are valuable to their brands, their ability to use analytics to better understand their ‘digital customers’ is hindering their ability to use online channels as effectively as they’d like.”
So even though 39% have ‘increased access to data and insights’, less than a quater (that’s less than 25% to those with no Mathematical ability or 1/4 for those who remember fractions in school) are using readily available concrete user data and customer insights to assist their decisions.
“32% of marketers agree that being able to generate and leverage deep customer insights is central to effective marketing, but they also say that this poses the greatest challenge to them. Interestingly, 11% of marketers stated that they face difficulty in assessing the effectiveness of their digital marketing because of the difference between traditional and online metrics.”
Why does being able to leverage deep customer insights pose the greatest challenge? Is it lack of training? Is it bad hiring? Are you not good enough for the job? Have these simple insights not yet been aired in the office? Or are people just lazy? Does your employer not care about their KPIs? Do they even have KPIs? Do they not know how to make any ROI? Is there to much focus on vanity metrics like Facebook likes? Or is it as simple as they just don’t care about the customer?
The post continued…
“Marketers are struggling to assess the impact of digital marketing because of their inability to translate analytic results into insight, or identify the right metrics in the first place. 31% of marketers feel that online metrics do not adequately quantify the financial impact digital marketing has generated for their companies. Alarmingly, 24% can’t even understand what these metrics actually measure.”
24% can’t even understand what these metrics actually measure. Does anyone else know how stupid that sounds?
Lack of leadership
“27% of respondents said they feel that they lack internal leadership on analytics. Meanwhile, one-quarter face difficulty in finding internal talent, and one in ten thinks that their HR department is ill-equipped to identify candidates with analytic skills. The greatest challenge, unsurprisingly, lies in funding. As a result of all these issues, only 4% of McKinsey’s respondents believe that they possess the necessary capabilities to effectively manage their business.”
The last quote in this post and probably the most important. 27% feel there is a lack of leadership. 10% think that the HR department can’t find adequate candidates. Numbers and analysis are for nerds right? The majority of you don’t need to know numbers because you can get by creating mildly engaging campaigns and pumping thousands into Facebook advertising. After all, Facebook is a business metric right?
Stop assuming and guessing
Lots of behavioral data surrounding the actions of your audience and your customers is right there in your analytics system screaming at you to use it. This would clearly allow you to deliver far more engaging and rewarding contextual content. If you are not using these insights to influence your marketing activity then you are just assuming the information, products and messages that you are serving are what your audience are looking for. How can brands keep making assumptions when all this incredibly valuable data is available and they have commercial business objectives to meet?
Lead don’t follow
All of this lack of understanding tends to lead brands to focus less on their website and business objectives and more on the social web. However, Facebook and the social web are actually causing brands more problems that acting as any form of solution. The social web is confusing. It’s more work. It needs far more resources than brands think. It’s unknown and it is always moving. On your website, the content and the data on it is owned by you, whereas on sites like Facebook you have the complete opposite, but nonetheless brands assume it is the answer to all their commercial problems and flock for a number of reasons;
a) Everyone else is on Facebook so we have to be there
b) There are 900 million users, jeez
c) You believe it will assist your brand reputation by being ‘transparent’
d) Your intern said it was where all the cool kids are
e) You read too much Mashable
or most likely,
f) Because you just don’t know enough about your customers and Facebook allows you to gain that level of insight you crave.
Let’s keep this simple; how many brands have made money from Facebook that they can measure? And if Facebook is used as a loyalty and influence tool, how many people know how to migrate the engagement within Facebook back to their own websites?
Unless you are a HUGE brand, it’s unlikely the referral traffic from Facebook to your online shop will make any real impact on your sales figures. Social media is; the stories that you create, leading to conversations and ultimately, transactions. Those who understand their data, know their customers and in return create the best stories (content).
A wake up call
“The time is coming when employers are going to be forced to walk around their offices and fire the people or their agencies who are not quantifying and providing real results.” (Neeraj Sharma – Badgeville) If you don’t understand your data, you don’t understand your customer. You can create as many engaging campaigns as you like but they will always lack the buy in that leads to advocacy, loyalty and long term engagement.
It’s time to stop assuming, making broad assumptions and estimating everything and time to learn the principles of data analysis and understand your users. Keep things simple, focus on the key business objectives and the behaviours you are trying to drive. Use this framework to to make a real difference rather than spending clients media budgets. If you don’t have the knowledge or tools, which is understandable as it takes time to both understand and apply the right principles – find the right experts who can, before you pay the price for your ignorance and are deemed to be arrogant by your users for not listening.