How to Become a Data Driven Business
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- Sibyl Cox
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1 January 2012
2 Executive summary Becoming a Data Driven Business, particularly from a Marketing perspective, presents significant benefits in helping your business to grow, develop and succeed, by working smarter, through more intelligent, targeted marketing; faster, by implementing more campaigns based on individual customer journeys; and better, through more efficient use of resources. In order to achieve this there are significant barriers to overcome, most notably in terms of people, data and technical issues. You therefore need to think carefully about how best to address these, including getting buy-in from your board and getting your data up to scratch. You ll also benefit from following a process of appointing an appropriate individual with responsibility for data quality, identifying which data you need to provide access to across your organisation, deciding which sources you need to include, auditing your data to identify duplicates in your systems, assessing your technology to ensure it s able to support you, and standardising on a single cross-functional system such as CRM. This whitepaper details how to become a Data Driven Business, the barriers to success and practical steps through which to address these, and how you ll know when you ve achieved your objective. 2
3 What do we mean by a Data Driven Business? Given that you re reading this whitepaper, it s safe to assume you re interested in understanding what it takes to become a Data Driven Business - in which case you may already have read the D&B whitepaper Towards the Data Driven Business, which can be found in the resource section of the website. If not, it s worth downloading, as it explains in detail what we mean by this term. It also summarises the results of a D&B survey in 2011 into data usage in UK businesses, including the characteristics of organisations that are either information, insight or intelligence-led (all of which you ll also find referenced in this whitepaper), together with an easy way to benchmark your own organisation s performance. As a follow-up, How do you become a Data Driven Business? examines the practicalities of achieving this with a particular focus on Marketing - including the barriers you ll have to overcome, the steps you ll need to take to get from where you are to where you want to be, and how you ll know when you ve arrived. To begin with though, here s a reminder of the benefits of becoming a Data Driven Business, and what this could mean for your organisation. Why do it? Data is only data until you do something useful with it. So by definition, a Data Driven Business is one in which all the different kinds of data from your Marketing, CRM and Finance systems (including prospects, customers, transactions and products) is tightly integrated, enabling you to work smarter, faster and better. By creating a single dynamic customer view, this has benefits for your entire business, including Sales, Marketing, Customer Service, Finance and your board. Smarter means more intelligent, targeted marketing; winning better business based on improved knowledge; reducing customer churn; increasing loyalty; and using marketing insight to segment pricing, products, channels and media based on known and predicted customer behaviours. In terms of acting faster, integrating customer, prospect and third party data with a Marketing Automation system such as Eloqua, Aprimo or Silverpop lets you implement more campaigns based on individual customer journeys, and create campaigns that used to take months in just days. Better means better and more efficient use of resources. This includes matching resources - especially Sales and Customer Service - to tipping points, so that your intelligence is focused on fully understanding where somebody is in their buying cycle or customer journey and acting accordingly (e.g. is a customer ready to purchase or are they just enquiring?). Among the many ways in which this can help your business grow, develop and succeed include: Equipping your Sales team to more effectively target customers and prospects. Reorganising Sales territories to maximise the impact of limited and expensive resources. Developing a better understanding of where to use Telesales to tip a potential customer into the next phase of engagement, and so reduce your reliance on Field Sales. Improving your quality of sales, through more high-level strategic consultancy selling. Enhancing Customer Service, through more effective progression of customer engagement into the most appropriate areas of your organisation. In particular, becoming a Data Driven Business will transform the capabilities of your Marketing team, by helping them to: Generate more, better qualified leads. Derive greater insight from transactional data enabling a clearer understanding of which products and/or services each individual customer is purchasing, how often, and what they re likely to purchase in the future. Combine this information with contact and firmographics data to identify opportunities for cross- and up-selling. 3
4 Treat customers and prospects as individuals, and more effectively target them through personalised, one-to-one campaigns, rather than generalised, mass market approaches. Enable marketing through the marketing funnel and into the sales cycle. What s stopping you achieving this? If these kinds of benefits sound attractive, the first step in beginning to take advantage of them is to get a clear understanding of where your business stands today. As highlighted in Towards the Data Driven Business, this D&B model outlines the major stages in becoming one, by looking at the degree of data integration an organisation has achieved versus its corresponding efficiency and effectiveness. EFFICIENCY & EFFECTIVENESS The 3 stages of data integration Fragmented Linked Integrated DEGREES OF DATA INTEGRATION Insight Information The D&B survey mentioned earlier found that the majority of UK organisations (53%) still consider themselves to be information led, 30% to be insight led and 17% intelligence led. Wherever you are on this model, research shows there are three common barriers to more effectively integrating your data which is the key to becoming a Data Driven Business. It s important to understand these, as they re pivotal to success (or otherwise) in building a business case for investment in this area. People In 2004 Gartner highlighted political and organisational issues as the two biggest barriers to the integration of customer data, and these issues still apply today. They typically arise when parts of an organisation don t understand the system, and/or there s been a lack of user involvement in its specification, leading to poor design and a failure to properly identify all data entry and/or customer touch points. Budgets are also often heavily focused on technology, with little or no investment in training, and even intelligence led companies can neglect the importance of training, and so fail to properly exploit the full potential of data integration and tools such as Marketing Automation. Data Poor quality data, such as duplicates or data that is incomplete, out of date or not fit for purpose, seriously affects the way you can utilise your information impacting customer relationships, increasing inefficiencies and potentially losing sales or lengthening sales cycles. So do data conflicts, lack of ownership beyond individual functions, lack of companywide data standards, or a tendency to see data entry as an overhead. Data issues are therefore business-critical for information and insight led businesses that do not yet have real time data feeds, but also for intelligence led organisations where more and more decisions are data-based, meaning that this data has to be truly robust, accurate and fit for purpose. Technical issues Although technical issues have been a longstanding barrier to effective data integration, more tools than ever before are now available to enable businesses - even those with historical investments in legacy departmental systems - to prove a return on investment: The integration of legacy databases is becoming easier, as technical advances such as Web 2.0 and Cloud computing mean that for the first time, many solutions are genuinely platform independent. New integration software, and the emergence of integration competency centres, are enabling 4
5 businesses that have been struggling with integrating their data to outsource the key skills needed to make this happen. Data as a Service (DaaS) is enabling real time data feeds to be integrated into CRM systems. Critically, this is the tool that is allowing B2B marketers to transform their understanding of changing customer behaviours. Where to begin the process? So with technical issues diminishing, how do you tackle your other two main barriers people and data issues? Get buy-in from the board In terms of people issues, the key is to get buy-in from your board especially as there s growing board level recognition that the customer database is a key area for investment, with an Alterian survey (2011) finding that over 59% of businesses were planning to invest in the next 12 months. To do this you need a strong financial model with small, incremental and implementable steps, measurable outcomes, demonstrable cost savings, revenue enhancement, and strong links with your marketing and corporate strategies. Investment in improving data usage is unlikely to come from your Marketing budget alone, so this has to be a companywide investment. To achieve this you need both a rational business case and one that creates an emotional response. You should also identify a board level champion (whether it s your CTO, CFO, Head of Marketing etc.) who recognises the benefits and is prepared to support the crossfunctional team needed to drive success. And the best way to do that is to show how you can make a measurable difference to one or more of your biggest and/or most immediate business challenges. Get your data up to scratch If you re an information led business, your biggest data issue is likely to be cleaner data. Integrating your data will reduce waste, drive down costs, make you more efficient and deliver a very quick return - especially if you re using a Marketing Automation system priced according to the size of your database, in which case you can reduce this cost immediately. You should also start with a data audit, ideally using an external supplier with a reliable universe data set, who will not only be able to spotlight issues with data you already have, but also the missed opportunities from data you don t. If you re an insight led business, you ll benefit from linking to deeper and richer datasets. This will increase the effectiveness of your insights, whether this is around lead scoring and accuracy, or improving the targeting of Sales resources on the best opportunities to reduce your sales cycles. Either will help to prove your business case, by enabling you to bring in more revenue more quickly. Or, if your business is intelligence led, you should look at using DaaS to power even more intelligent sales and marketing campaigns based on customer behaviour, as this will give your business a much stronger view of your most valuable customers - benefiting the entire organisation. Follow this six-step process Whether your business is currently information, insight or intelligence led, you ll find it easier to drive your evolution into a Data Driven Business by adopting the following process, some steps of which you may already have completed: 1 Appoint an appropriate individual with responsibility for data quality. 2 Decide what data you need to provide access to across the business. 3 Decide which sources internal and external you need to include, and that can be easily integrated into your systems. 4 Audit your data to identify duplicates in all your systems. 5 Audit your technology to ensure your systems are API compatible etc. 6 Standardise on a single cross-functional system e.g. CRM. 5
6 How will you know when you ve arrived? According to the D&B model, a Data Driven Business is one that puts data at its heart so that all decisions can be based on true business intelligence. Because all customer data is accessible in real time to all parts of the organisation, all decision makers at every level have an accurate and multi-dimensional perspective of customers and prospects. This live and compound view then enables them to decide with confidence how they should approach, manage and invest in every customer or prospect, based on the best possible business intelligence at all times. THE DATA-DRIVEN BUSINESS Sales CRM System Integrated Data Operational Finance Systems Marketing Systems Marketing When this sounds like your business, you can be confident that you re genuinely data driven. Need help? To find out more about becoming a Data Driven Business, or for assistance with this process, please contact us on or visit 6
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