My Take: CMO Survey On Marketing Analytics

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A Forbes blog post on marketing analytics reported the following:

“A February 2012 CMO Survey asked marketers “In what percent of your projects does your company use available or requested market analytics before a decision is made?” The average score was 37.2%. This means that 62.8% of the time, managers are not using marketing analytics!”

The author of the article offered a number of reasons for why this is the case including:

“First, managers don’t want to know the answers marketing analytics provides. Second, marketing analytics doesn’t offer sufficient insights to managers; it tends to confirm what they know. Another reason managers may be reporting lower usage levels is that they are discounting an important impact marketing analytics can have on companies—it can change the way managers think.”

The author goes on to introduce an interesting construct for thinking about marketing intelligence:

“There are three ways manager use any type of marketing intelligence, including marketing analytics—instrumental use, conceptual use, and evaluative use. Instrumental use means that marketing analytics is used to develop or implement strategy. Conceptual use means that marketing analytics affects managers’ beliefs, knowledge or the mind-sets they bring to their work. Evaluative use means that marketing analytics is used to evaluate marketing actions. Unfortunately, companies tend to spend most of their marketing analytic investments on evaluation.”

[Note: Yes, I know, it should be “managers” not “manager.’ This isn’t the only grammatical typo in the Forbes article. I get the sense that nobody proof reads that stuff]

My take: The explanation for the use of marketing analytics is way off base, as is the estimate of how companies allocate their marketing analytics investments.

There are a number of things wrong with the Forbes article:

1. The CMO Survey asked marketers what percentage of their projects use marketing analytics. It didn’t ask — which would have been an interesting question — in what percentage of the projects where marketing analytics was not used, could it have or should it have been used. There’s no basis upon which to assume that every project should have or could have used marketing analytics.

2. There is no reason to believe that marketers “don’t want to know the answers marketing analytics provides.” There may be plenty of marketers that dismiss, mistrust, or ignore the “answers” that marketing analytics provides, but that’s a different explanation than “don’t want to know the answers.”

3. Marketing analytics doesn’t just “confirm what marketers already know.” In fact, the author contradicts this assertion herself by defining the Instrumental and Conceptual use categories later on in the article.

4. It’s questionable that “companies spend most of their marketing analytic investments on evaluation.”  No data is offered to back up this claim.

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The Forbes article, and from what I can gather, the CMO Survey itself, does a huge disservice by failing to address the most important question here:

What is marketing analytics?

In a related article, the author of the Forbes article indicates that asking top marketers to report what percentage of their marketing budgets they spend on marketing analytics was s a reasonable request because “70% of all top marketers state that the marketing analytics group reports to them.”

No argument there. But marketing analytics is more than just a department. If we’re talking about just the department, then maybe having their involvement in 37.2% of projects is too high.

If marketers answered the survey only thinking about the marketing analytics department, then they shortchanged the concept of marketing analytics.

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Without seeing the full results of the survey, I can’t tell whether or not marketers were asked specifically about their investments and activities as they relate specifically to the three categories of marketing analytics (instrumental, conceptual, and evaluative). This is an interesting categorization that warrants further research, if it wasn’t included in the CMO survey.

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Bottom line: Analytics continues to be a big buzzword in the marketing space. Understanding the uses and opportunities for the practice needs to do a good job of defining what it is, and isn’t.

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