5 Steps to Becoming a Data-Driven Decision Maker
Most marketing executives, when they first dip their toes into the waters of results reporting, look to report on their funnel results, which depend entirely on having a functioning lead management process—i.e., they are smart enough to look beyond the activities reports, such as web site visits or email clicks. While these measures may be useful to the campaign manager on a daily basis, they are definitely not to be confused with results that are the basis for strategic decisions.
Our learned colleagues at Gartner tell us that 76 percent of marketing organizations are accountable or share accountability for a P&L. But Aberdeen tells us that in reality only 19 percent of marketers have comprehensive tracking and reporting practices in place. Wow! Clearly, there is plenty of impetus for marketing executives to quickly drive a data-driven decision-making mentality throughout their organization. And as executives, we have to demonstrate that we ourselves are cut from this mold.
So what are the steps to producing regular, accurate, useful results reports that enable an organization to make better marketing decisions and evolve into a data-driven decision-making organization?
First, a word of caution: Too often I have seen firms rush out and buy the latest reporting software as if it were a panacea for all their reporting ailments. Also, some CMOs pursue vanity metrics—metrics that “prove” the value of marketing instead of empowering better decisions for better performance. If you take nothing else away from this article, please avoid being fascinated by the latest shiny software object, and do not focus on producing vanity metrics first.
Step 1. Decide what you want to measure.
This is not as straight forward as you might imagine. You need to engage with the marketing team, determine their Key Performance Indicators (KPIs), and find out what decisions they want to inform with these metrics. Are they trying to become more efficient, more effective, redirect resources and budget? Are you going to measure marketing influence, and is there an attribution model for that? Now prioritize these metrics and KPIs based on impact to the business. Notice we did NOT discuss how to measure them, where to measure them, and broader data, process, and system requirements. That comes later!
Step 2. Determine what reports you will need to measure the KPIs and metrics you selected.
With the metrics and KPI requirements in hand, determine what set of reports are required to effectively provide that data. What are the parameters and dimensions that define these reports? In what systems will the reports be generated?
Are the fields present and collecting data currently in the systems you wish to run the reports in? Are new integrations or file transfer required? Do your teams currently update the data in a reliable way? What data importing processes need to be redesigned to support these reports? Will your existing technology stack support the reporting you need for effective decision making? Will you use Excel, a marketing automation platform, a CRM system, or some combination of all of these to produce the reports? The answers to these decisions will probably cause you to re-prioritize which reports you produce first.
Step 3: Commission someone to build the reports.
Don’t send the initial reports to a wide audience because it is highly likely you will uncover unknown data and process issues. Also, there is a risk that the reports won’t conform to a widely held view of how things are, and you need to be sure the data and the reports are spot-on before you start that battle. You don’t want to lose reporting credibility just as you are getting started.