Big data isn’t just Google’s plaything (and billion-dollar moneymaker). Every business wants its slice of the audience data pie. Marketers spent more than $20 billion on third-party audience data last year, according to a report by the Winterberry Group.
Winterberry surveyed marketers across the U.S. to get their thoughts on how they’re using, or planning to use, big data.
Organizations nationwide are focusing on achieving “data-centricity.” The term means the extent to which a company is culturally and operationally oriented to apply internal data as well as audience data as sources of actionable insight in support of business development, product development, operational strength, advertising efforts, marketing goals, and audience engagement.
More simply put: “There’s a massive amount of data out there, but how do we harness it? How do we use it? How do we drive more precision in both the businesses operations and sales growth?”
That’s the question everyone seems to be asking. While the efforts to compile and execute decision making using internal data vastly differ among organizations, the methods for pivoting on external data to optimize engagement with a marketing audience has much more consistency.
Some 90% of organizations surveyed by Winterberry say they have or are planning to develop an enterprise strategy to support the use of their audience data. And no wonder… optimization around audience data has the potential to propel growth far beyond the forecasts of the CFO.
In practice, being data-centric involves four facets:
- People – How talent, training, compensation, and tenure impact the way a company uses and gets value from data.
- Platforms – Investing in and leveraging the right tools to support audience building, insight development, analytics, and measurement.
- Partners – Agency experts, data suppliers, and other service providers.
- Processes – A company’s organizational structure must support data compilation, management, sharing, and use.
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Becoming data-centric isn’t an option anymore. Using internal and external sources of data is going to become increasingly vital, and not getting on this big data bandwagon is going to leave your company in the dark ages. Creating a long-term strategy for harnessing big data is a must.
According to Winterberry, organizations that optimize their use of data will be positioned to lead. Data’s impact spans marketing, product development, finance, customer experience, and virtually all other functions, representing a potential source of competitive advantage that requires resources, guidance and oversight.
But here’s the rub: Fewer than 10% of companies surveyed are where they want to be in terms of using the massive amount of customer data available to them. They’re working on it though, but they might be a little over-confident about how quickly they can get there.
The Data Analytics Talent Shortage
One big reason is an industry-wide gap in talent. Companies need experienced data analysts and they need them yesterday. They can invest in platforms, partners, and processes all they want, but without the people to make this world of data spin ’round, it’s all at a standstill.
CEOs say this gap in talent is their top concern. Nearly nine in ten of the companies surveyed by Winterberry said data analytics is the top skillset that’s most important to support their future data-driven marketing, advertising and media efforts. The good news is the number has come down slightly since the last survey but we need to see a lot more progress on the data analytics function in the next 18-24 months to feel confident that marketing organizations are on the right path.
If you’ve got a smart kid in college, you should advise them to investigate a major in data analysis, data science, machine learning, and especially the more traditional statistics and computer science majors… and do so immediately. There simply aren’t enough people with the analytic skills necessary for data modeling, segmentation, and attribution.
Across the board, people are less confident they’ve got a handle on data and how to use it than they were last year. Check out these differences between some key questions between this year’s survey and last year’s:
- Getting results? In 2016, almost 30% of people reported they had developed strategies for using the data in advertising or marketing, and that strategy was implemented and delivering results. This year, that number was only 12%. It dropped by more than half.
- How data-centric are you now? In 2016, 24.3% of people said their companies were extremely data-centric. This year, that figure fell to 9.8%. Again, dropping by more than half.
- How data-centric will you be by 2019? A full 44% expect to be extremely data-centric next year.
What’s the deal? We think the move to becoming data-centric is more challenging than we thought it was. Marketers got overconfident that they can make that leap quickly, but then find out when they get “there” that they haven’t arrived yet. Getting the most value out of the massive amount of audience data at companies’ disposal is like peeling an onion. It’s causing a lot of organizational change, and new roles need to be created on marketing teams which will help to accelerate companies’ ability to become data-centric.
- Becoming data-centric is vital, but difficult. Despite the proliferation of audience data, significant obstacles hinder companies from realizing maximum value from that data. As practitioners grow their awareness of data-centricity, it’s becoming more difficult to achieve.
- It takes time. Transforming companies into data-centric organizations won’t happen overnight.
- Talent. The most significant challenge facing companies today is how to develop and nurture a corps of marketing and media professionals with the skills necessary to do the job, including predictive analytics, segmentation, and modeling.
Bottom Line: It’s about people with the skills and experience to wrangle the most value out of audience data, the platform or equipment necessary to handle the data to support audience building and insight development, the partners or outside providers we can cooperate with and the processes we have in place internally to support data compilation and management.
In other words, to benefit from the data tsunami, a sea change within organizations is needed. That change is coming, but the majority is not there yet.
To read more about the results of this research, download the report