Analytics As A Secret Weapon
Competing on analytics sounds like a good thing, but is your organization actually living it? This past week at the OMMA Metrics and Measurement conference in San Francisco, we heard several agencies talk about how analytics aren't just a piece of the business, but are the key drivers in helping their clients kick the s#$t out of their competitors. Knowing how to successfully arbitrage and optimize the trigger points of the entire funnel through the use of technology and ingenuity takes not just smart minds but incredible discipline and stamina.
I can tell you that within my company we indeed have been bitten hard by the data bug. It doesn't come naturally, though -- you have to build the discipline and practice it every day (kind of like yoga). So if you think you are winning with analytics, here are the top five checkpoints that I would propose are critical in knowing if you are on the right path:
1. Know your business model. From audience identification to conversion, the business needs to use analytics to optimize the entire supply chain. Develop key metrics to evaluate both cost and performance at every step of the model. Do this tactically -- put it in a spreadsheet where you can see and measure it.
2. Know your trigger points. Within the business model there are key trigger points that, when optimized even a little, will move the needle a lot. For some of us it may be just optimizing the impression to the right audience and reducing waste. Perhaps it is a mouseover, click or clickthrough.
3. Ensure that you have a testing "program" in place. Carve off inventory on your site or campaigns to constantly test. It will provide ongoing learnings (even if some tests fail miserably). Constant "tweaking" helps, but also look to test completely "out of the box" ideas to identify if there are other avenues you should be pursuing (i.e. creative ideas, pricing models or marketing channels).
4. Stay abreast of technologies that touch your trigger points. One example of this is layering in data to improve performance. Whether it is at the impression level or optimizing a direct mail piece, targeting through data can eliminate waste and increase conversion at the same time.
5. SWOT it! You should be constantly scanning the marketplace for strengths, opportunities, weaknesses and threats. This boils down to finding arbitrage opportunities where you can create value for your customers and margin for your business. If you can optimize numbers one through four above, then you'll have first-mover advantage when it comes to competing on analytics.
Becoming a powerhouse in analytics takes discipline to infuse it in your company's DNA. And unless you are on the verge of developing a widget (and I use that definition as the one from business school) that is groundbreaking, analytics are a secret weapon in operating more efficiently, cost-effectively and shrewdly than your competition.