Analytics, market research can benefit corporate competitiveness too
NOVEMBER 14, 2011 – Conducting internal market research and parsing the analytics can be a valuable way to find hints on improving the corporate culture, but many companies are too disorganized to actually implement those findings, a study suggests.
The IBM Institute for Business Value and the MIT Sloan Management Review found that 44 percent of responding executives, analysts and managers from around the world are most challenged by cultural barriers when it comes to adopting an analytical approach to making improvements, as opposed to the 24 percent who cited technology as the biggest issue.
Using analytics can provide companies with an edge over their competitors, the researchers say, with those who are experienced or “transformed” users of the information doubling their chances for outperforming other organizations in their sector.
“The early and aggressive adopters of analytics make significant gains in both performance and overall competitiveness,” said Fred Balboni, IBM’s global leader of business analytics and optimization. “These indicators point to an urgent need for organizations to foster a data-oriented culture and drive an analytics strategy that embeds fact-based insights into decisions and processes at every level of the business.”
The study showed that respondents were applying analytics to their operational and financial decisions, but have yet to rely on the insight when it comes to addressing customer service, human resources and business strategy issues. Those companies that have mastered the application of analytics in daily practices have noted that decision makers can make a choice more quickly, are able to understand and engage their customers and also foresee and offset enterprise risks.
Out of the responding “transformed” organizations, 78 percent said their distinguishing characteristics included being able to analyze data. They also cited having a culture that was open to new ideas (77 percent), the capability to collect data (77 percent) and making the insights accessible to those who needed them (65 percent).
As Jolina Pettice points out on the TopRank blog, analytics and market research can be highly valuable to advertising companies when they are trying to determine the best course of action for a search marketing campaign and sell it to the decision makers.
Having hard numbers about how a promotional push will affect revenue, investment and return on that investment is the key to convincing the C-suite that a proposed project is worth spending time and money on to bring it to fruition.
Pettice explains that executives “want to understand the correlation between the investment and what the business received. Specifically, they want to be able to forecast and compare intelligently across channels via at-a-glance reports. The details aren’t what they want, they want an assessment.”
Meanwhile, the marketing professionals will be seeking out more detailed notes, such as click-through rates, page views and length of time spent on the sight. There are seven phases to measurement, she says, including auto-pilot – where marketers do not do any measurement and don’t know what aspect of the campaign is working – web metrics – in which the audience is slowly introduced to the data – and conversion.
The next stage, cost data integration, involves looking at the ROI and the campaign’s performance. Offline data integration requires combining web and phone inquiries, while the lead quality/classification step involves focusing on quality in addition to the number. The final stage, business, involves calculating the cost and resulting revenue per customer.
Analytics should not be something that marketers simply lean upon to make their arguments for them. As Matt Bailey of Site Logic told Pettice, the insight is meant to encourage curiosity.
“Analytics is subversive, therefore your job is to constantly ask why,” Pettice writes, paraphrasing Bailey’s advice. “You should constantly attack accepted norms and keep questioning if what you are doing is going to reach objectives.”