Samuel Taylor Coleridge’s epic poem of 1798 “Rime of the mariner” contained the infamous cry, “water, water everywhere and nor any drop to drink,” made by sailors after the ancient mariner killed an albatross for sport that could lead them to safety. They hung the albatross around the mariner’s neck as penance for his actions.
In today’s world, given the explosion of data driven by the digital age, we can perhaps hear business leaders lament “data, data everywhere and nor any to fuel my business”. Indeed, a recent Forrester survey revealed that some 78% of an organisations data is not used for insight: a key activity that is the bedrock of delivering effective marketing communications, measurement, and overall business intelligence.
Barriers to creating value from data
What is affecting business’s ability to leverage the power of their data? It would appear to be one or a combination of:
• Disconnected data – Almost two-thirds of businesses say that it is difficult to get insights from their data, whilst nearly half of companies say that data silos are impacting on their ability to deliver a rich customer experience (E-consultancy 2019).
• Martech adoption – With over 4,000 technology vendors in the marketplace, choice is becoming increasingly difficult with a 2020 McKinsey survey discovering that “products built for large enterprise, not SME customers, makes it hard for smaller businesses to use technology”. What’s more, E-consultancy reported that 46% of business leaders said that technology was the most significant barrier in developing joined-up customer journeys.
• Budget and time constraints – There is a belief that any data-driven transformation will take an inordinate amount of time and budget – a report from E-consultancy suggested that the average project can take up to 5 years to implement – largely as a result of “vanity” based technology purchases and not one that scales with business growth. As we will see below, vendor selection is a critical component of any data driven transformation.
• Resource and skill sets – The vast increase in data has outstripped the availability of resource skilled in using it. Indeed, LinkedIn has recently reported that data scientists were in their top 5 advertised positions over the last year – a role that didn’t figure in the top 50 five years ago.
Compounded by consumer expectations
This inability to drive the data agenda forward is further compounded by the ever-changing needs of today’s consumer, who:
• Expect a flawless service – As reported by Accenture in 2019, 92% of consumers agree it is important that every interaction they have with a brand is excellent, whenever or wherever that interaction happens in the decision to purchase from a brand or retailer.
• Require an individualised experience – Epsilon recently reported that 80% of consumers are more likely to make a purchase when brands offer personalised experiences.
• Are undertaking complex journeys with many more brand touchpoints – Research has shown that consumers have an average of 8 touchpoints with a brand before purchase, whilst it is reported by Harvard Business Review that 73% of consumers use multiple channels to make their purchase.
• Expect brands to understand their preferences and respect their privacy – GDPR has placed more focus on data governance, with many businesses still struggling with the complexity of the regulations. According to a 2020 Salesforce survey, 86% of consumers want more transparency over how their data is used. whilst the same report indicated that 66% of customers expect companies to understand their unique needs and expectations.
• Are adapting their shopping habits as a result of the pandemic – The move to online shopping has been well documented and the latest research suggests that 75% of all Christmas shopping was conducted over the internet.
Data driven transformation bridges the gap
The effective use of data can deliver business transforming outputs, as well as bridge the gap between the data obstacles faced by organisations and the requirement to deliver to consumer expectations. As we all know, it is a hugely competitive environment and businesses need to capitalise on what tools they have at their disposal if they are going to maintain a competitive advantage through acquiring, growing and retaining their customers, as well as using their resources more efficiently and effectively.
Data is the foundation upon which this transformation and growth can be delivered – research by leading consultancies have seen dramatic results as a result of organisations adopting a data-driven framework.
• Are 162% more likely to exceed revenue targets – Forrester 2020
•Are 23 times more likely to acquire more customers – McKinsey 2020
•Grow at an average of 30% each year – Forrester 2020
•Increase their profit by 8% – BARC 2020
However, data-driven transformation shouldn’t be seen as a big-bang solution, rather it needs to be an evolution that is considered, planned, and phased over time – ensuring that quick wins are realised whilst a clear flight path for future development is clearly documented and understood.
Embarking on the data driven transformation journey
So, what does this evolution look like and how should it be approached? The 8 steps below describe the high-level journey towards data driven transformation.
1 - Set business goals and vision
• Identify the strategic aim and goals of the organisation and the business problems that are being addressed.
• Create a vision for what the future looks like – this may be, for example, a unified data solution providing a 360° view of the customer; enabled by appropriate marketing technology that drives personalised communications with data access tools providing the ability to create rich insight as well as visualisation of the outcomes.
• Design a solution that fits you now and can be scaled as you grow; ensuring that your plan is realistic, iterative and benefit-driven at every stage – with clear measurement plans in place to allow you to evaluate performance.
2 - Achieve stakeholder buy-in
Many transformation initiatives fail as key stakeholders may not understand the full business benefits. It is critical to overcome any internal barriers through creating awareness of the outcomes and communicating a business case that delivers a clear ROI and supported by other key tangible paybacks such as customer retention or reduced costs through data-driven process automation.
3 - Resource realistically
Consider your internal resource and the skill sets that are required to deliver to requirements. Many businesses underestimate the time and expertise required to successfully implement a data transformation strategy, especially given that existing teams are undertaking their day jobs – so consider specialist resource from agencies such as Data³ – who can not only support you with the creation of the strategy but build out your platforms as well as train your teams to manage and get the most out of the solution. An approach that can be built into your business case.
4 - Identify data sources
Make a map of all the data in your business and identify the platforms and the type of data that it holds. Many businesses make the mistake of wanting to use every piece of data – but be selective – what data do you need now and what may you need in the future? Of course, some of the data that you want, may not exist, so make a plan of what you want, how you are going to get it and how you are going to use it.
5 - Onboard enabling technology
Technology should never be the starting point of any data transformation – it is akin to the tail wagging the dog. Using the plan that you have created, develop a list of functional requirements and don’t be tempted with a “vanity” purchase. Whilst many of the enterprise-level solutions are extremely good, think about the cost/benefit and how it will be used. Will you be able to use all the functionality with what you plan to do over the next 3 – 5 years and what is the true cost of ownership? With the plethora of marketing technology in the market today there are many low-cost modular solutions that will deliver to requirements of businesses that are early on in their data transformation efforts and that can deliver a surprisingly high level of functionality – such as driving personalised communications over multiple channels, delivering personalised landing pages as well as providing campaign planning tools.
6 - Analyse and visualise
Good data visualisations allow you to understand complex relationships between different types of data and help you spot patterns – so you can see what’s affecting your results and what you might need to change.
Use it to understand what your most valuable customers look like, what, how and when they buy. Create knowledge to make faster, better decisions – for example, which marketing channels are working for different customer types and where should you invest marketing spend, optimise campaign performance through understanding levels of engagement and/or conversion and adjusting the offer, frequency or content to maximise returns.
7 – Automate
Replacing time consuming manual processes with slick automation can make your life easier and take the pressure off other resources saving you time and money. For example:
• Marketing communications that are deployed automatically through triggers based on customer behaviour
• Alerts warning you about problem areas, so you don’t have to do the monitoring
• Reviewing a dashboard knowing you’re seeing live, up to the minute results
8 – Optimise
As we have said earlier, embarking on a data transformation journey is an evolving process. The beauty of using data to drive growth is the ability to ascribe measurability to all activity – providing the platform from which to test alternative approaches, assess the outcomes at a granular level and then adjust to ensure an optimal performance.
What it all means
Don’t let data be the albatross around your neck that inhibits your ability to get your business to where you want it to be. Plan your data transformation carefully – create the team, get the buy in and make sure you have a clearly defined vison and roadmap with milestones that deliver measurable benefits – and ensure that the technology you use can grow with your business, and not one that has more functionality that you will ever use.
Get it right and you too could reap the benefits that a data driven solution can deliver – more customers, increased revenue growth and enhanced profitability.