Measure or Die – Why data-driven marketing is a must-have mindset in 2020
April 13, 2022 | Chris Kervinen
As The Economist put it: “If they CMO can’t present what drives engagement in a compelling way to the CFO then they won’t pay attention.”
In 2020, World Federation of Advertisers conducted its largest global study to date , surveying 683 leading marketers from over 30 countries together with a global market research agency 2CV . The goal was to find out what are the biggest challenges today’s marketers face, what can be done to bridge any skill gaps that exist, and what else CMOs need to be conscious of to succeed into the 2020s. The massive research defined three core categories:
- Economic pressure
- Technological demands
- High consumer expectations
These categories represent more or less the biggest challenges CMOs around the world are facing today or have to face tomorrow. And regardless of industry, seniority or region, data-driven marketing provides a solution for them all.
Economic pressures – The need to do more with less
There aren’t probably many companies that didn't experience significant economic pressures mounting up during the latest white swan event (yes, it can’t be defined as a black swan event, as we did see this coming up – we just didn’t do anything about it).
It's extremely difficult to achieve bigger impact with less resources, in marketing or in any other function. But it is possible. Probably the most important thing “doing more with less” -objective requires is resource reallocation. Successful resource reallocation in turn requires knowing how efficiently your current marketing mix is performing, and what’s the ”investment elasticity” for each channel.
But when considering the fact that the study’s interviews were already conducted before the pandemic, it’s obvious that the marketing proof gap – the difference between how CMOs and CEOs perceive the business impact that marketing generates – has been there for a while now. And when marketing is seen as “soft” function and the marketing budgets as costs instead of investments, well that’s when a form of marketing minimalism kicks in.
The first tells you where you can and should start the surgery, whereas the latter helps you to avoid overinvesting in seemingly efficient media channels that have sharply decreasing ROMI (which seems to be the case with most of the marketing budget cutter companies that reallocate majority of the resources to online media channels – which are profitable with the current investment level, but stop being efficient when the budget is tripled).
Some might argue that data-driven marketing (utilizing statistical analysis and big data analytics to support the decision-making process) isn’t as useful or necessary as some of the industry experts claim. But it is practically impossible to measure individual media channel’s efficiency when there’s multiple overlapping offline and online media channels at play, not to mention interpreting the optimal investment levels and channel synergies.
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