• by Karl Greenberg , May 27, 2015

Data-driven marketing (DDM) is becoming a redundant term, and while marketers are confident about what it can do, the sentiment is tempered by concerns about how to prove the value of investing in DDM technology. Also, confidence among executives isn't as high as it was. Nearly three-quarters of respondents to a joint study by the Direct Marketing Association and strategic consulting firm Winterberry Group said they were confident. That enthusiasm, however, is at a two-year low, according to the organization. 

The study, based on an April online survey of 293 DMA members, including 166 marketers and 127 marketing services, and technology providers, finds that overall spending on DDM grew at a faster pace in the first quarter of 2015 than reported in a full year. Over 37% of practitioners reported growing their investments, and 47.7% said their spending did not change since the previous period. This compares to last quarter when only 26.6% of survey panelists said their DDM expenditures increased compared to the prior quarter, per the organization.

Marketers are also using more mobile technology as data mines, with 60.4% of respondents saying they use these today, although small numbers called these tools “mission-critical.” 

Neil O’Keefe, SVP of CRM and member engagement at the DMA, said the results suggest marketers appreciate the growth potential but also see a need for improved measurement and talent development. Also, while marketers in the data-mining side of the business are selling new technology to executives, those top marketing execs are are having trouble gauging the value of the spend: most of the panelists polled for the study said it is hard to prove value from new platforms, and integrating new and existing tools has been a challenge. 

That said, nearly half of panelists (44.7%) reported that their revenues generated by DDM activities grew in the first quarter compared to the previous quarter, while 41.4% said their related revenue remained constant. And 59% of panelists said their companies are likely to purchase/implement new DDM technology in the coming year. Forty-three percent said they are likely to increase spending on DDM next quarter, while 48.2% expect to maintain current levels of spending.

Meanwhile, respondents agree that the tools are key, with 65% agreeing that “Aggregating and integrating disparate data sources” is a high priority for their organization. Only 40% indicated that their organization does a good job of training internal teams about new technology.  

“As an abundance of data continues to accelerate business innovation and opportunity, it has also created new and ever-more complex risks and challenges,” said O’Keefe in a statement. “This further underscores the commitment needed throughout the industry in terms of marketing and business science development.”