Nand Kishor Contributor

Nand Kishor is the Product Manager of House of Bots. After finishing his studies in computer science, he ideated & re-launched Real Estate Business Intelligence Tool, where he created one of the leading Business Intelligence Tool for property price analysis in 2012. He also writes, research and sharing knowledge about Artificial Intelligence (AI), Machine Learning (ML), Data Science, Big Data, Python Language etc... ...

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Nand Kishor is the Product Manager of House of Bots. After finishing his studies in computer science, he ideated & re-launched Real Estate Business Intelligence Tool, where he created one of the leading Business Intelligence Tool for property price analysis in 2012. He also writes, research and sharing knowledge about Artificial Intelligence (AI), Machine Learning (ML), Data Science, Big Data, Python Language etc...

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How Data And Analytics Are Changing The Face Of Modern Marketing

Aug 21, 2017 | 2970 Views

Recently, I posted an interview conducted with Wes Nichols, the former CEO of MarketShare, on the ways in which data and analytics are impacting organizations (see here for the article and video). Below, I share Nichols' interesting perspective on how these changes will impact the future of marketing.

Kimberly Whitler: Are there any significant challenges that will impact the CMO's ability to effectively manage data and analytics in the future?

Wes Nichols: There are several: 1) lack of CEO understanding and sponsorship, 2) lack of CMO talent (this can be handled by hiring the talent), 3) challenge in finding the right analytics talent, 4) ineffective systems/data acquisition, etc. However, one of the biggest ones I want to mention is the problem I see firm after firm struggling with. They are bombarded with B2B vendors (typically technology/systems/software vendors) who promise extraordinary, magical tools; unfortunately, these B2B firms don't have great awareness of the needs of the CMO. They've only recently turned away from calling on the CIO to start focusing on the CMO. The issue is that CMO's often don't have the skill-and there is nobody on their team that does either-to vet these B2B firms. And when you don't have deep experience in technology, it can all sound very similar.

I'm seeing a "Generation 2" situation where many CMOs were burned by purchasing inferior solutions from "garbage suppliers" who overpromised and underdelivered. Many CMOs are realizing that they still need the solution-but that they picked the wrong company. The problem is compounded when a purchasing department gets involved and focuses almost solely on the low cost provider.

Two things are going to happen. First, there will be the inevitable shake-out of the posers and a better deployment of the right technology in the next phase. Second, CMOs will start making sure that they have a tech person on their team who is capable to distinguish the posers from the real-thing. Some are advocating for a Chief Marketing Technology Officer position but this is overkill and will create silo-based issues. All that the CMO needs is somebody who can distinguish fact from fiction.

Whitler: What does this mean for marketing in the future?

Nichols: The confluence of digital, data, and analytics is essentially causing a ripple effect. In the future, there won't be the need for as many marketers on the client or agency side as more activities will be transacted automatically (instead of manually). It also means that economic incentives will change as companies will work to move away from silo-based measurement systems to ones which look at marketing activities in a more connected way will get to a better understanding of impact. It also means that firms will move away from the historically popular silo structure (marketing, sales, finance, etc.) to a center of excellence structure. So essentially data and analytics sophistication will impact how it is elevated to the management team, the structure, the processes, the approach, and the decisions being made.

Whitler: How does this impact marketers? What can they do?

Nichols: The structure of marketing needs to reflect the skill set of the CMO. There is a continuum regarding data/analytics literacy upon which CMOs fall-from data capable and tech savvy on one end to disinterested or purely execution-focused on the other. The CMO will need to compensate for their deficits by arranging the structure, talent, and organization accordingly. How some companies deal with a less analytically sophisticated CMO is to move the function underneath the CFO. I'm seeing this happen where the CMO doesn't have the interest, competency or skill. What this means for CMOs is that they either need to have the skill, develop the skill, or hire the skill. If they don't do this, the analytics function will be given to some other C-level leader who can manage it. The problem with this is the CMO needs these tools close by so they can definitively link their activities to business impact - sales, leads, share gains, return on invested capital (ROIC) and the like. Marketing must think of itself as a profit center and not a cost center.

That leads to the most important thing that the CMO can do; have the right team in place. Many still do not. That creates challenges regarding budget planning, attribution and measuring activities credibly. Companies today have so much data and the center of gravity is usually housed in marketing-the function responsible for connecting the data dots in a way that creates incremental revenue. That is a different responsibility than just campaign or creative development-effective marketers today have to work with large data sets, technology, and integration.

Whitler: To prepare for the future, how should CMOs think about organizing their departments to better manage analytics?

Nichols: Most CMOs currently have an analytics person or team. However, this role is primarily focused on analyzing CRM data and existing customer activity. This is important but there is another side of analytics that is equally important and that is the side that focuses on budget planning, optimization and allocation of resources. I think that in the future, we will start to see further delineation of analytics people and skills. Today, some companies aggregate research, analytics, measurement, and budget planning under one function. Rarely does a single person have competency in all of these areas. And the biggest problems I see are when it is allocated to one person. Again, you often see this in packaged goods where they often confuse research with analytics. And from time, we see a consumer research expert who is now tasked with attribution and measurement modeling, and they typically aren't as equipped to manage it.

As I mentioned before, when marketing doesn't find the right talent and take this responsibility on, then other executives need to take the responsibility, hiring somebody that they will manage. I've also seen finance assigning a person to marketing, which has worked quite well. And if you are a CMO and you have a CEO that doesn't understand the importance of data and analytics, then sharpen your resume and look for a firm that embraces data-driven decision-making.

Source: Forbes