Marketing Analytics: If you don t measure it, you can t market it.

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1 Marketing Analytics: If you don t measure it, you can t market it

2 What is a Springboard? Let s be honest, modern day marketing is not always easy. The transition from marketing as art to marketing as science has put a premium on rigor, data, process, testing and optimization. Keeping track of marketing trends and understanding the latest technologies can be a handful for you and your organization when combined with other day-to-day responsibilities. At Demand Spring, our Springboard guides help you breathe a little easier. They are designed to trim the fat and provide the most critical information on trending demand generation topics to quickly educate newcomers and help seasoned professionals stay on course. In other words, consider these guides a springboard to help you confidently and successfully dive headfirst into the marketing practices your organization needs to know to drive demand generation success.

3 The Changing Face of Marketing Technology has changed (or eradicated) many professions over the past century and a half. The industrial revolution caused massive disruption for cobblers, potters and weavers. In more recent times, the Internet has created similar disruption for professions such as payroll clerks, travel agents and tax preparers. While the marketing profession is still alive and thriving today, it has undergone a significant transformation in the 21st century. Don Draper s corner office is now occupied by a new breed of marketing superstar one who is much more left-brained. Gartner estimates that by 2017, the IT budget of a CMO will exceed that of a CIO 1. The reality is, most marketing organizations are ill equipped to extract critical insights from this data. In IBM s 2011 CMO Study, only 41percent of CMOs said that they are prepared to access the unprecedented growth in the volume of data 2. They lack the personnel, technology, standards and processes that are required for effective business analytics. While investments are being made in automating marketing processes, there hasn t been a commensurate investment in marketing analytics. As a result, their decision-making remains more influenced by gut decisions, team meetings and HIPPOs (Highest Paid Person s Opinion), than by information. Accurate insight into pipeline coverage, campaign performance and marketing ROI is significantly lacking. Marketers who are not part of Generation Y have had to adapt or perish in this transition from brand to demand and art to science. They have learned a new language the demand waterfall, SALs, SQLs, lead scoring. Not to mention new technologies Salesforce, marketing automation, and MRM. But what is really required for marketers and marketing departments to survive and thrive in this tectonic shift? Insight! Most marketing organizations are drowning in data and starving for information. They are overcome by a tsunami of Big Data. Transactional data. Data in Marketing Automation Platforms (MAP). Data in CRM systems. Data from the Web and from financial systems.

4 The Missing Imperative Marketing Analytics The good news is that most CMOs recognize the gap. In IBM s study, customer analytics is ranked as the second highest planned technology investment by CMOs for the next 3-5 years. A full 67 percent of respondents plan to increase spending in this area. CMO s know that increasing their investment in analytics is a key requirement to two outcomes: 1. Driving the competitiveness of their business in the marketplace 2. Ensuring the ongoing relevance of their department within the organization In a study co-conducted by the MIT Sloan Management Review and IBM in 2011, a clear link was found between the adoption of analytics and competitiveness. Analytically sophisticated companies are 2.2X more likely to outperform industry peers 3 If there is a clear relationship between competitiveness and analytics, there is also a clear relationship between the use of marketing analytics and competitiveness. The customer is king (and queen) has never been more true than it is today. The Internet has dramatically changed the balance of power between buyer and seller. Studies reveal that B2B buyers no longer wish to engage with a vendor s sales reps until they are two thirds of the way through their evaluation process. Extracting insight on the digital body language of a prospect or existing customer is paramount to driving wins. In an age when the majority of CEOs are sceptical about their return on marketing investment 4, proven marketing-driven ROI and pipeline contribution is a must have for today s CMO. For marketing organizations that excel in analytics, the job is much easier, and it shows in their performance.

5 Best-in-Class Analytics So what does a best-in-class marketing organization look like when it comes to how they use analytics? What are the key areas they need to get right? This is a journey that takes a superior analytics strategy, the alignment and discipline of people, processes and standards, and the use of world-class technology. Strategy Strategy Technology Processes & Standards People Analytics Strategy Connects to Business Strategy: Best practice organizations treat analytics as one of the top business and technology priorities in the organization. The necessary investments in people and technology are made to enable a world-class analytics environment one that enables data integrity and accuracy, real-time visibility into key performance indicators and predictive analytics to model future performance. Performance management methodologies such as the Balanced Scorecard, Six Sigma or TQM are often used to connect strategy and execution, with analytics as the foundation for measurement. Competency Center: Business Analytics Competency Centers are comprised of representatives from throughout the business IT, BI, Sales, Marketing, Finance. They govern the strategies, standards, processes, and technology selection and implementation for information management and business analytics. KPI Development: Marketing identifies and measures key performance indicators (KPIs) that map to the objectives of the business and their operational unit. Marketers have a set of KPIs that are relevant to their area and ladder up to the department and organizational KPIs to ensure a consistent focus on the operational processes that matter most.

6 People Processes & Standards Executives: One of the most critical aspects of a successful analytics implementation is the sponsorship and usage of the environment by executives. Marketing executives must use analytics to measure KPIs and set an example for the rest of the organization by managing the business (pipeline analysis, ROI analysis, gap identification and communication) using this environment. IT: According to Gartner, analytics ranked as the number one technology priority for CIOs in This trend is likely to continue for the foreseeable future as IT will provide the fountain to connect analytics strategy to business strategy using technologies such as transactional databases and data warehouses. Marketing Operations: There are three critical Operations roles in best practice organizations: Lead Taxonomy: The alignment by Sales and Marketing around a common lead language is a required foundation for analytics. Many organizations today are adopting SiriusDecisions waterfall framework Inquiries, Marketing Qualified Leads, Teleprospecting Qualified Leads, Sales Accepted Leads, Sales Qualified Leads to achieve alignment. CRM Enforcement: CRM adoption throughout sales is required in best practice organizations. The use of marketing campaign tactic codes is respected (MQLs are not closed and re-opened as sales-sourced). The CRM tool is used for forecasting, with sales executives using the forecasting data in cadence calls. The SiriusDecisions Demand Waterfall 1) analytics Strategists individuals responsible for the on-going stewardship of analytics strategies and technologies (these often sit in the now common BI department) 2) report Authors individuals responsible for creating gold-standard reports that users can explore in a selfservice manner, as well as creating ad-hoc reports required by the business. These authors are skilled at producing the full-spectrum of analytics dashboards, scorecards, reports, analysis and predictive models. 3) Business Analysts these are individuals with significant statistical analysis backgrounds combined with a strong understanding of the business. They use reports, analysis and predictive analytics to understand deep data patterns, current and future performance gaps and to communicate best practices drawn from data insights to marketing and sales leaders and professionals. Marketing Users: Users throughout marketing are empowered to engage in the analytics environment in a self-service manner. They use gold-standard reports, analysis, dashboards, scorecards and predictive models created by report authors to understand their area of the business, using the information to make data-driven decisions that optimize performance. Copyright SiriusDecisions Inc. All rights reserved. Patent pending. Demand originated from marketing-led activities Demand originated from teleprospecting function Handoff from one function to another Demand created by direct sales or channel resource

7 Technology Information Management: Information Management solutions are used to capture transactional information (CRM solutions such as Salesforce), to unite data from multiple data sources (data warehouses such as Teradata and Netezza), and to ensure common naming conventions (Master Data Management such as IBM Infosphere) to ensure a single version of the truth. Without a solid Information Management layer, it s not possible to have a strong and trusted analytics layer. Business Analytics: Best practice marketing organizations leverage business analytic solutions that sit on top of data sources such as CRM, MAP, Web, and financial applications. This provides marketing with a holistic and accurate view of data. Using a BA solution enables marketing organizations to: Interact with various analytics capabilities that best suit their needs: dashboards, scorecards, reports, multidimensional analysis Take advantage of predictive analytics capabilities to model future performance and required actions Deliver analytics to users anytime, anywhere through mobile device support Take advantage of event-driven analytics that push notifications to users and/or systems when certain operations hit predefined thresholds (for example, re-order notifications when inventory levels drop)

8 Ten Years of Marketing Analytics Experience Demand Spring has more than ten years experience marketing and using business analytics solutions on the client side with IBM and Cognos. We bring this knowledge to our customers, helping them create a closed-loop environment to proactively measure pipeline coverage, creation and progression, along with campaign performance. Our marketing analytics services include: Building an analytics strategy that reflects the four key pillars of best-in-class implementations: strategy, people, processes & standards, and technology Identifying and prioritizing key performance indicators and measurement frequency Developing pipeline build models to measure and analyze next quarter (NQ) and NQ+1 pipeline build to ensure required pipe coverage attainment Developing pipeline progression models to measure and analyze current quarter (CQ) pipeline progression and required actions to ensure plan attainment Developing a marketing sourced leads (MSLs) analysis model to identify the progression of MSLs, including stalled leads and actions required

9 From Data to Information to Insight The days of marketing remaining focused on building brand are clearly behind us. CEOs are now requiring greater accountability from marketing with respect to the language that matters to them: pipeline and revenue contribution. The good news for marketers is that the technology and process insights to enable a robust analytics environment have never been stronger. As demonstrated by best-in-class organizations, those with discipline who make the required investments in strategy, standards, processes, people, and technology reap tremendous rewards. The payoff comes through marketing programs and customer engagement actions that are highly relevant and optimized to produce maximum return on investment. ENDNOTES 1 CIO Becomes the New CMO! Ajay Kelker, Smart Data Collective, February 18, smartdatacollective.com/ajaykelkar/46548/cio-becomes-new-cmo 2 IBM CMO Study, why-smarter-analytics/customerinsight.html 3 The New Intelligent Enterprise, a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership 4 In a recent study by the Fournaise Marketing Group, 73 percent of CEOs from across 600 organizations said that their marketing organization is not the business growth generator it should be. These CEOs think marketing fails to demonstrate how marketing strategies and campaigns generate more customer demand, more sales, more prospects, or more conversions. In a similar study, 77 percent of CEOs feel marketers talk about brand, brand values and brand equity but fail to link this back to results that top management cares about: revenue, sales, earnings, or market valuation.