During a lunch with the CEO of a small start-up, he said: “People tell us that we must do data-driven marketing, but I’m not sure that that’s the most important focus for us at this time”. I tried to explain to him that there’s no way to do marketing without basing it on some data input.
When people talk about data-driven marketing, I find it problematic in several ways. It’s like saying that we should do information-driven marketing, or people-driven marketing, or behaviour based marketing. But I understood his concern since data-driven marketing is what many people are talking about now.
Data-driven marketing is non-sense
Data-driven marketing is just one of the marketing buzzwords that pop up every year. At the beginning of the digital marketing era, everyone was social media experts. After a while, they decided to become content marketing experts instead. Lately, I hear that more and more people claim that they’re experts on data-driven marketing.
At Retune in Berlin this fall, the British programmer Karsten Smith said: “If you focus on a tool just because it’s new, you might become a victim of the rhetorics of newness”. This quote stuck with me. In marketing, we are always hungry for trends, and we need to embrace changes and opportunities to stay ahead. But at times must remind me, and others: nothing is smart just because it’s new. There’s no causal relationship between the two attributes.
What is data-driven marketing?
Definition: Data — “facts and statistics collected together for reference or analysis.”
Definition: Marketing — “the action or business of promoting and selling products or services, including market research and advertising.”
If we start at the beginning: data-driven marketing should be promoting and selling products or services based on facts and statistics. But what if I tell you that facts and statistics is the base for all marketing? To do marketing successfully, you usually consider everything you know about your customer and based on that knowledge you act in ways that serve the business well. This method usually means that you use knowledge extracted from data in one way or another.
New technology gives us more data
New digital technologies have created new ways for marketers to get to know their customers. Most things we do online is trackable and possible to measure. These new technical possibilities make digital data cheap and pretty easy to collect in large volumes. But it is important to remember that data in itself, without proper analysis, is worth close to nothing. And it’s the people who interpret data that offer the value and stands for the most of the cost.
But digital data is not superior to other data types in marketing. Marketing is a complex task, so we need all sorts of information to do it successfully. Digital data can only count as part of this information. Digital data is often lacking more qualitative information, such as the customers’ thoughts, feelings or body language. And while the number of clicks before conversion, or the average time on an individual page, might say something about more qualitative aspects, we can never be sure.
To do effective marketing, you need a variety of information, including several types of digital data. If you blindly trust your digitally tracked data points, you won’t have all information, and you won’t fully understand your customers and their needs. Data analysis is about more than the slope of a curve. It’s about combining the curve with other things you know, and draw conclusions based on all the info you’ve got at hand.
Data-driven marketing is not for everyone
Few marketers know how to read the massive amounts of digital data that they collect. If you’re not familiar with statistics and data analysis, it will be tough to understand it fully at first. But the most important thing is that you should combine your (new) digital marketing skills with the rest of your “classic” marketing knowledge, such as customer interviews, focus groups and gut feeling.
Doing data-driven marketing without enough knowledge can probably be worse than not doing any data-driven marketing at all. If you don’t fully understand the information you’re basing your conclusions on, how can you trust your decisions? How can you create a growth strategy if you’re not sure what you’re tracking and why it’s important?
I studied both statistics, research methods and data analysis at Uni. I did quantitative data analysis for my psychology bachelor thesis and qualitative analysis for my business one. And sure, I believe I remember most of it, but it only makes me smart enough to know when to get help. I don’t mind doing fundamental analysis in Google Analytics; it gives me a lot of information that I need. But I never trust my interpretation when it comes to details.
Whenever I have clients in need of more advanced analysis, I partner with someone who knows more than me. Implementing tracking is, for instance, something I try never to do. But the good thing is how the stage when I need help keeps moving forward.
Don’t forget your qualitative data skills
With a background in behavioural psychology and consumer behaviour, two fields that are heavy on qualitative data, I often prefer qualitative data analysis. I still do a lot of customer interviews and empirical observations as an essential part of my work.
I also talk to salespeople and others who meet the customers. Salespeople talk to “real” customers every day. They often have a closer relationship with the customers than I can ever get from behind my screen. To me, this little chat is also data collection. And although digital data is essential, it is not a good idea for an organisation to trust only this data.
The data you get from a script in a browser is just half the truth. Complement what you see with more (qualitative) information. Try to merge different perspectives to make smarter decisions.
Update your knowledge
We will continue to need well-educated marketers and marketing teams with cross competences. If you don’t have any data analysis knowledge yet, make sure you update your skill set. It will become essential in a few years. A good start is to talk to people who know more than you. (You can often persuade data scientists and programmers with your real interest in their field).
But don’t believe people who tell you that qualitative data analysis is the only skill a modern marketer need. Or that data-driven marketing in the meaning of “big data” is the only thing you should do from now on. That’s just not true.
My three 2015 takeaways for the anxious marketer
- Base all marketing on reliable data and analysis that gives relevant information
- Don’t focus on what’s new, focus on what’s smart
- If you try to follow the buzz, you’ll always be behind everyone else instead of ahead