The way we measure marketing results has changed fundamentally over the past decade.
Brand awareness, once the primary gauge, has taken backseat to ‘making the numbers.’ In this respect, the line between marketing and sales has never been less distinct.
Consequently, the churn rate for chief marketing officers is now the highest of any executive-level job. The median tenure for a CMO at the 100 most-advertised U.S. brands is now 27 months, and only a third of current CMO’s at those companies have been at the same company for three years or more.
A never-ending flow of marketing results – tallied by a dozen or more computer-monitored formulas – is the new fascination of marketers, and the resultant stress has rattled company bones all the way up to the C-suite.
It has changed the way we look at business.
Here at The Good, we’re all in favor of leveraging data in decision making. In this article, though, we’ll look at three potential pitfalls of data-driven marketing.
Then, we’ll present a way to leverage the danger to create greater opportunity.
The Problem with Data-Centered Marketing Results
Marketing executives are getting pressured to perform like never before – not just to reach goals this year or this quarter, but daily.
Just as the internet’s 24/7 news reports stir the pot politically, instant access to marketing data and the daily drilling into current statistics has made short-term victory the thermometer of success.Instant access to marketing data has made short-term victory the thermometer of success. Click To Tweet
Not only does fascination with the present situation create a myopic view of the marketplace, the need for branding and awareness hasn’t gone away. There are still times when it pays to forego short-term profit for the long-term goal.
How Wrigley’s became a household name
In a classic example, Wrigley stopped selling Juicy Fruit, Spearmint, and Doublemint gums during WWII. They opted, instead, to send all of their high-quality production to the military. On the home front, Wrigley produced an inferior product, but kept an ad campaign going that featured the slogan “Remember this package.”
That strategy endeared the company to veterans and citizens alike, propelling Wrigley’s to American icon status. Had the company relied entirely on ‘making the numbers,’ they might have gone a different route entirely.
Why the CMO position is in jeopardy
Further exasperating the situation is the pandemonium surrounding the rapid and significant changes in the collection and application of data. Few CMO’s are skilled at managing the intricacies of the necessary processes. That has created widespread confusion about what ideal CMO candidates look like.
- Is it better for today’s CMO’s to be schooled in IT?
- Is an MBA no longer sufficient?
- Should the CMO be a hybrid who has studied cross-discipline?
- Should the CMO position be done away with entirely and replaced by a “Chief Digital Officer”?
For many companies, the dust of the impact of ready access to an overwhelming amount of data has yet to settle sufficiently to allow clear vision and clear thinking about either the problem or the solution.
A CMO who doesn’t thoroughly understand data gathering and data-informed decision making is at risk of appearing incompetent, and incompetence never bodes well in the C-suite.
In summary, there are several challenges facing chief marketing officers and VP’s of ecommerce as they adjust sails to keep up with the ever-changing winds of technology.Data-driven marketing shines a spotlight on the present, many times at the expense of the future. Click To Tweet
Here are the three most critical hurdles marketing departments and top-level management teams must address:
- The push towards data-driven marketing shines a spotlight on the present, many times at the expense of the future
- The line between marketing, sales, and internet technology is fuzzier than ever before, making responsibilities difficult to set and position titles inadequate
- Few individuals possess the combination of marketing and data science skills necessary to demonstrate a commanding knowledge of both
Don’t wait for the situation to make it necessary for you and your team to confront these issues. Be proactive and do it by choice.
The Solution to Handling Data-Centered Marketing Results
Sometimes, the questions are complicated but the answers are simple. We aim to present a simple two-step approach to steering your sales, marketing, and IT departments away from danger.
First: Bring the three potential hazards listed above out in the open. Talk about them frankly with your management team. Decide where your company stands on the issues.
- How will you handle the new demands on your CMO?
- Will you rewrite the job description?
- Will you develop channels between sales, marketing, and IT to make sure all bases are covered?
- Are your day-to-day numbers getting in the way of your longer-term strategy?
Hammer out the issues and write your decisions into your strategic marketing plan.
Next: Make sure everyone on the team knows the path your prospects take on the way to becoming your customers. Identify the key junctures along that path, and make sure your data reporting is focused on those critical numbers.
We often find the problem is NOT the fascination with metrics, but making the mistake of collecting too many data points (confusion) and worrying about the wrong data points (non-essential).
The measurement that matters most is ROI. Marketing can’t do a whole lot about cost of sales, but it does directly affect the amount of sales. That’s part of the current dilemma: marketing’s effect on sales is much more readily determined than ever before.The measurement that matters most is ROI Click To Tweet
In the rush to get more traffic to the store and get more sales from the store, the pivotal point between those two objectives sometimes gets overlooked. And it’s there that most companies can wring the most from their marketing efforts.
Here’s the missing link: conversion rate optimization.
Once you’ve identified the buyer’s journey and defined the critical points along that journey, you have something worth paying close attention to. By making incremental improvements to the conversion rate at those junctures, you can boost ROI considerably.
We’ve designed a simple tool to help you set up scenarios and see the results. Play with it a bit. Try different numbers until the lights come on. Conversion rate optimization can take the heat off of marketing and give everyone on the team a reason to breathe freely again. Here’s the link to that online app: Conversion Rate – ROI Calculator.
We won’t go over conversion rate essentials here. Rather, we’ll point you to resources capable of turning downward spirals into growing businesses.
Here’s the list:
- Conversion Rate Optimization Essentials: The Master Guide
- Micro-Conversions: Unlock Your True Conversion Rate
- Top Five Analytics Reports for Ecommerce
- 50k Pageviews And Other Misguided Ecommerce Goals
- Useful Google Dashboards To Help Make Google Analytics Actionable
By using the principles of conversion rate optimization to corral data into usable, sensible, practical chunks, you’ll empower the CMO and everyone else on the marketing team to once again understand and monitor the most important numbers.
The new measures for marketing results aren’t complicated… unless you allow them to be. Set smart parameters, monitor them daily and test to keep improving those numbers. Don’t let them get the best of you. Rather, use them to get the best from your business.
Here’s one more resource. Start here: The Quickstart Guide to Data-Driven Marketing.