If I’m the first person to point you to Pat LaPointe’s MarketingNPV site, go there and spend a few hours perusing the great content on that site.
On his blog, Pat posted his predictions for the “Path of Predictive Analytics.” I wanted to share some of those predictions, along with my thoughts on them.
Pat says: “Analytics are increasingly the lifeblood of a CMO’s accountability process.”
My take: Analytics could be the lifeblood — but it isn’t. For now, the analytics focus in many organizations is at the campaign level or at the investment level (i.e., what was the impact of last quarter’s media spend). For analytics to become the lifeblood of the accountability process, the focus needs to shift from a micro- (investment level) to macro- (enterprise-wide) perspective.
Pat predicts: “The corner office will go from interested to involved to participating in marketing decision making. The analytics underlying resource allocation recommendations will need to more clearly articulate and justify what you need, why you need it, and the payback.”
My take: Pat is mostly right on here, but his prediction misses the nuances of C-level behavior. CEOs don’t want to be involved or to participate. They just want the process to work smooth, and to produce results. Smart CMOs will utilize (not rely) on analytics to build trust. How many CEOs really understand the models that CFOs use to make financing decisions? Certainly not all — but they trust that their CFOs are making smart decisions with these models. CMOs need to be comfortable in explaining their analytical models (as Pat says “sans the geek interface”) so they, too, can build the trust that CFOs have gained.
Pat predicts: “The near future of analytics will go beyond one-time, ‘what’s going on today’ metrics to present real-time continuous results. A new ‘test and learn’ framework is also helping marketers capture feedback and adjust to it more quickly.
My take: For me, ‘real time, continuous results’ doesn’t capture the essence of where analytics needs to be headed. Instead, it’s something more like ‘dynamic measurement window.’ Analytics must do a better job of tracking and tying together the investments that were made last year (and the year before) that have an impact on this quarter’s results, and forecasting and projecting out results into the future. Again, it goes back to the micro-focus of today’s analytic efforts (“how did THIS campaign do?”).
Here’s the bottom-line: Looking ahead, analytics has a huge opportunity to:
- Shift the discussion from the micro- to the macro-. Instead of talking about how the last campaign did, CMOs can start talking about how the firm is doing as a result of marketing investments.
- Improve transparency. CEOs and CFOs hate to admit this, but they have no clue how marketing spends its money, let alone how it decides to spend its money.
- Build trust. Regardless of how sophisticated your modeling techniques are, if the senior management team doesn’t trust marketing, then marketing isn’t succeeding. Analytics can help build this trust — but it isn’t a panacea.