Best Practices for Creating a True Analytics Culture

. November 9, 2018 . 0 Comments

The article below is excerpted from the new Forrester research report How An Analytics Culture Drives Exceptional Business Results, created in partnership with the ANA and Neustar. View or download (PDF) the full research report here

Competitive pressures are increasing across the board for brands today. Customer demands and preferences are constantly changing, and
 there is increasingly less margin for decision-making error. Meanwhile, torrents of data are flowing from an ever-broadening array of sources.

Marketers have a quantifiably-proven opportunity to develop an analytics-driven culture that can dramatically improve results, ranging from higher ROI and greater speed, to improved effectiveness and ultimately, more revenue.

An analytics culture matters. Here’s how to develop one.

First, take a hard, realistic look at your company across all the factors that influence analytics culture: strategy, technology, data science expertise, organization adoption, and turning insights into action. Since an embedded analytics culture is such a significant contributor to improving business performance, companies must work to remove friction throughout their journey to organizational mastery.

For starting companies:

Creating and perpetuating an analytics culture is a top to bottom effort.

It’s critical to recruit an executive champion, and then reach across the organization to individuals and teams that will be impacted and engage them early. Finance, for example, will be critical in defining the metrics that link to C-level priorities. Brand and field marketing will have insights and hunches about what market factors must be accounted for and where data about them lives. IT will be critical allies to acquire and cleanse data.

Depending
 on the structure of your business, valuable insights and data could be gathered and contributed from customer service, corporate communications, distribution, or even HR. From the early days, create a collaborative team environment where each function’s contribution is actively solicited, and findings are communicated back to them to acknowledge their value.

Building an analytics culture is a journey, not a sprint. Starting and keeping an analytical mindset across the company requires planning, perseverance, and clear communication. Begin your next cycle (or a mid-year revision) by requiring more detailed data than is typically provided to support requests. This will begin to change the conversation and identify the data/insights gaps that need to be filled. Use this process as an input for defining new skills, hiring staff, upgrading technology, and managing data.

It may take several cycles for the shift to truly take hold. Along the way, evaluate deficiencies in organizational structure and processes that may impede full support of data-driven decisions. During this transition, while decisions might be made with less than perfect data, insist on progress over perfection, as the former is more important than adhering to a level of data quality that isn’t yet available.

For developing companies:

Involve analytics teams more deeply in decision making. An analytics report that sits on a shelf fails to deliver value to the brand. And if analytics initiatives are created and activated only after a marketing plan is developed, they may fail to deliver the full potential
of data-driven decisions. The analytics team — and the data insights they generate — should be woven into the entire strategy, planning, budgeting, and execution processes. Each analytics exercise will answer some questions, while posing others. Having the analytics team fully engaged in this iterative process will spur faster progress.

Continuously reinforce the value and reliability of analytics. Not everyone will have a deep enough quantitative background to fully understand the methodologies and techniques applied, so the process may feel like a “black box.” To avoid this, take time to provide the entire marketing organization and all stakeholders — from top to bottom — the basics of how these analyses work, how they are applied to business problems, and any potential pitfalls.

Eliminate walls between analytics and other key functional
areas. The point of creating an analytics culture is to enable better decisions and generate improved business outcomes across the entire organization. Analytics teams and efforts that are placed in their own silo can lead to misunderstandings, miscommunication, and lost time. The more exposure each group has to the other, the faster they will learn and create value from analytics.

For mastering companies:

Use analytics to stay hungry and agile. Avoid preconceptions about where, when, and how analytics can be applied in your organization, and ask yourself: What new questions can we answer that will move the needle for our business? Embrace questions that might be seemingly impossible to answer. Present them as a group challenge and give team members permission to experiment, push boundaries, and fail along the way. Even if the answers prove elusive, you will learn valuable lessons along the way.

Expand the depth and breadth of your analytical focus. Many companies concentrate their analytics initiatives in an area with high visibility: the media budget. Mastering companies move beyond this to optimize decisions around pricing, store locations, assortment, and other factors among the four Ps of marketing. In this age of the customer, firms must optimize the entire customer experience, not just media and advertising. This demands a more unified and consistent approach to analytics that captures the impact of all of the marketing levers.

Never stop improving. Mastering companies must recognize that building a true analytics culture never ends. That’s why you are always “mastering,” and never quite reaching the ultimate “master” level. Continuously pursue new and better-quality data, seek out improved analytical tools and techniques, identify new business questions, and innovate. Benchmark your analytics maturity level against other companies. You will know when your analytics culture has taken root when new ideas and applications for analytics come from the ground up, rather than being pushed from the top down.

Never stop investing. Companies must continuously invest in expanding analytics capabilities. Thirty-four percent of mastering companies spend 10% or more of marketing budgets on measurement and analytics, compared to 71% of starting companies which spend five percent or less. As confidence and support grows for analytics programs, more and more budget can be shifted to support analytics goals.

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Category: Adoption, Articles, Basics, Culture, Data, Decision-Making, How-To, Organizational, People, Research, Research Reports, Resources, Strategy

About the Author ()

Daniel Kehrer is Executive Editor of the ANA Data Analytics Center (DAC), a leading voice of thought leadership and education in marketing measurement, data and analytics. He is also the Founder of BizBest Media Corp. and previously headed marketing at MarketShare LLC, an advanced marketing analytics technology company.

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