The more things change, the more they stay the same. When he wrote those words in 1849, Jean-Baptiste Alphonse Karr was not talking about analytics. But I would suggest his words ring true today when it comes to how we as marketers use analytics today, compared to 10, even 20 years ago. It’s not the technology that is falling short, but how we use it—the management system around analytics.
Before founding Demand Spring I spent ten years in the analytics industry, with Cognos and IBM from 2002-2012. I saw plenty of organizations who used analytics really effectively to manage performance, planning, and optimization. Also, I saw plenty who had made the necessary technology investments in analytics, but hadn’t built a management system around the analytics. In other words, they hadn’t figured out how to effectively incorporate the insights they were getting into their planning processes.
Many B2B marketing organizations today are still struggling with this same issue. Some have invested in the technology, but have not made a similar investment in data scientists dedicated to marketing who can derive the needed insights from the data. Many have simply not figured out how to embed the right analytics into their agile or waterfall planning and retrospective processes.
The result is many B2B marketing organizations who still operate more on instinct and intuition than on analytics-driven insights. The problem is exacerbated in tough economic times like now when CMOs need to justify investments to CFOs and the data isn’t easily available.
To dive into this issue more, and understand what CMOs who are ahead of the curve are doing in this area, I recently sat down for a conversation with Kate Reed, the CMO at Devo, a security analytics company, and Elle Woulfe, the SVP of Global Marketing at Formstack, a workplace productivity platform vendor.
How does your marketing organization incorporate analytics into your planning processes?
Kate: The short answer is we use analytics all the time.
Analytics are a powerful tool for aligning our marketing efforts with larger company goals and initiatives. Marketing needs to be well connected across the organization, especially with sales, finance, and customer success, to understand those goals and gain alignment on how marketing contributes to them. Then, we can allocate resources in the right areas and measure outcomes.
At the earliest planning stages, we set objectives for all of our marketing activities. Our team will never launch an integrated campaign if we don’t have clear objectives and, ideally, an indication of past performance. Without objectives, we would have no way to gauge our success and progress. We get really granular by looking at a specific campaign, audience, or tactic to see what’s working and what isn’t, and either accelerate or scale back our efforts accordingly.
One of the most significant benefits of having clarity on your performance is speed. Analytics helps us focus and move faster. Gone are the days when marketing teams planned six months in advance. With so much readily available data, we require the flexibility to tweak our efforts and pivot when needed. We plan our activities anywhere from a few months to a few weeks in advance in order to use the newest, most relevant data to our advantage.
Many teams focus on top-of-funnel and new acquisition marketing. Not us. Our marketing covers the entire customer lifecycle. We look at our customer usage data, who is visiting our community regularly, consuming the latest information on our website, and engaging with our brand. With that information, we can proactively plan campaigns to ensure the adoption of our product and proactively help customers get the best ROI from it.
Elle: I am always very committed to fostering a performance culture in marketing and it relies on committing to a few rituals that are analytics-centric.
The first is a bi-weekly team meeting that always begins by reviewing a core set of marketing performance and revenue metrics.
The second is a weekly cross functional revenue meeting that brings sales, marketing and CX leadership together with Rev Ops to review a standard revenue scorecard and discuss any points of friction or red flags that put the pipeline goals and bookings plan at risk.
The third is the discipline of running an in-depth QBR as a way to drive meaningful reflection on marketing performance across the entire team. This is our chance to double click and do much deeper analysis of all the critical marketing analytics than we do on a weekly basis. We look at overall revenue impact as well as discreet channel and campaign performance. This quarterly cadence creates a deeply ingrained discipline around using marketing analytics to inform planning and decision making.
What are the biggest barriers you have to getting the type of analytics needed to make data-driven decisions? Is it talent, technology, business process gaps, or something else?
Kate: The biggest challenge is the lack of a data-driven culture. Many marketers still don’t lead with data, which exposes them to execution based on the “latest and loudest” request in the room. It’s incredible that we have so many marketing tools and technology at our disposal. However, the tools are ultimately useless if you don’t have a team that is adopting the technology and actively trying to understand the data.
There’s a stereotype that marketers are “ideas people” who operate from their creativity and intuition. Data is profoundly changing our profession. While it’s necessary to have creative minds on your team, it’s just as important to strike the right balance between being creative and analytical. This opens up the hiring aperture to new kinds of talent.
Another common challenge for marketing teams—and organizations at large—is the pitfall of operating in silos. If your customer and product marketing teams aren’t aware of each other’s projects, tools, and objectives, you’ve lost an opportunity to optimize your activities. We should think of marketing like a symphony. Every team, while they may be playing different instruments, needs to be aligned on their timing and tasks. Nobody wants to listen to a symphony of people playing different songs at different times. That’s chaos! The team should function as a unit, not a cluster of separate groups fulfilling their objectives. This mindset should also expand beyond marketing to sales, customer success, and product organizations.
Elle: The biggest challenge in getting meaningful analytics is a combination of process, technology and talent. These tend to be legacy issues that are deeply ingrained and difficult to re-architect.
In earlier stage companies, I have had much more success in architecting processes and implementing systems to easily enable the right reporting and analytics. In later stage businesses, you are often beholden to decisions that were made long ago and data collection processes that can be hard to unwind and make it difficult to get the insight you need. Something as simple as date stamping can be the difference between having a good handle on velocity and operating in the dark.
What advice do you have for other marketing leaders regarding building a management system around analytics?
Kate: The most important thing to recognize is that marketing doesn’t work in a vacuum. Your marketing metrics and dashboards might look promising, but they don’t mean anything if the business isn’t performing well. I learned this lesson very early in my career when I presented a “green” marketing funnel (which was all the rage years ago, but thankfully we have since moved on) during pipeline reviews, yet revenue was way behind. Despite other departments reporting poor results, I would excitedly show my leadership team the great marketing data. Thankfully, a mentor pulled me aside and explained my mistake. You can’t flaunt great marketing results if the business isn’t meeting or exceeding its revenue goals. Though my intentions were good, my “great” results only proved that our marketing and sales teams were not aligned. That’s why it’s critical to be in lockstep with your sales and customer success organizations and ensure everyone agrees on what “success” looks like.
Also, a marketing operations and analytics discipline is arguably the most important discipline that you build out. But, while your marketing operations hires are incredibly valuable to the overall team, they cannot be the only people who prioritize analytics. Marketing leaders need to foster a data-driven culture from the top down. Whether they run the company blog, execute events, or build messaging, each person on your team should actively look for ways to measure and continually improve their activities. Data is everyone’s responsibility, and teams should be empowered to double down or change course based on what the data informs them of.
Finally, never stop learning. In the past five years alone, marketing best practices have entirely shifted. With a constant influx of new technologies and tactics, you must be curious and flexible. For example, for years, everyone believed the most important marketing success metrics were how broad your reach was and the volume of leads. As we’ve learned, the buyer’s journey is much more complex, with many more touchpoints throughout the marketing cycle. Nowadays, many teams are shifting to account-based marketing, where you maniacally focus on a select group of target accounts and focus your marketing efforts on them. The result is a far more optimized strategy that guarantees better results. In the world of marketing, things change. Fast. It’s your responsibility to adapt.
Elle: It can be easy to make short term decisions that have long term impact on the insight you’re able to derive from your processes and systems. Getting your analytics right from the start is a lot easier than trying to retrofit. It’s not enough to build processes that solve your immediate problems, you need to be mindful of how those processes will produce insights. In any new role, I find it’s helpful to start with the scorecard I want to build and then partner with the data or Rev Ops team to understand what we have the ability to collect today and what our roadmap needs to be to get the insights we’re missing.
Take: 5 Keys to Building a Management System Around Analytics
- Hire Data Scientists dedicated to Marketing. Despite analytics vendors touting for decades (I was one of them back 15 years ago) that analytics technology is to be used by the masses, the reality is that Data Scientists are one of the most valuable roles in marketing. They become the foundation for deep insights and for building “canned reports” that the masses can run.
- Create a planning and review process that embeds analytics. As Elle has done at Formstack, identify operational meetings that leverage analytics to measure and manage performance, pipeline, and help you update and optimize strategy and tactics. I love the focus of each of the three meetings she identified, and in particular am a huge believer in the regular cross-departmental revenue scorecard meeting.
- Break down silos. As Kate identified, silos exist within marketing, let alone across to other departments. One of the biggest misuses of analytics that I have seen (and made myself) is exactly what Kate described—marketing celebrating when the revenue scorecard has red components and sales is not meeting their revenue components. It’s a great way to damage the marketing-sales relationship.
- Ladder your analytics up and down. I like to distinguish between Strategic KPIs and Operational Analytics. Strategic KPIs are on the CMO’s Scorecard. They should be connected to the KPIs and strategies of the business overall. Things like Pipeline Initiated by Marketing, Return on Marketing Investment, and Cost Per Acquisition. Most organizations are reasonably good at creating a CMO Scorecard. The disconnect for many B2B marketing organizations is equipping marketers throughout the organization with Operational Analytics that drive the CMOs Strategic KPIs. As Elle identified, our recommendation is that a strategic project needs to be conducted to identify the Operational Analytics that drive Strategic KPI performance and determine where there are gaps in collecting, synthesizing, and presenting these Operational Analytics.
- Tie performance management and compensation to analytics. The most effective way to get marketers throughout the organization to start managing their portfolios around analytics is to identify a focused group of Strategic KPIs that are core to their performance review process. Even better is to then tie these KPIs into their incentive compensation. When I was at Cognos, our CMO put in place two Strategic KPIs (% of new pipeline created, and overall pipeline coverage) that every marketer in the company was compensated on based on attainment. The result—we all cared deeply about how each role helped build and progress pipeline, and it broke down silos within marketing and across to sales very quickly.
Contact us to discuss how we can help you build a management system around analytics. Engage Demand Spring for a Revenue Marketing System Audit to better assess your next steps for analytics-based decision making.