1.1 Why are analytics so important? - Video Tutorials & Practice Problems

<v ->All right.</v> So Digital Marketing Analytics. So we all talk about it, but how many of our companies are actually any good at it? Well, in my experience, not that many. Most of us are doing marketing analytics in a less than optimum way, shall we say? So we focus on kind of marketing performance that I would call reactive, trying to figure out what happened, maybe trying to justify things based on our numbers. Often we're focused on whatever the last thing is, the customer did is getting credit for whatever the sale or conversion is, and we rarely are calculating marketing ROI if we're not an eCommerce company. And that's really the current state that I see across many companies that I work with. That's not the state that you wanna be in. So what you're really looking for is to be able to set numeric goals every time you engage in some marketing so that you know what to expect from that marketing, and you're actually holding your marketing to some type of performance level. You also wanna look at the entire customer journey, not whatever they did last. And obviously if you're not measuring ROI, you kind of wanna, because if we're always complaining that marketing budgets are getting slashed well, why do you think that happens? It's because we can't prove that marketing is actually working. And so if you can't prove marketing's working, it shouldn't be a surprise that the budget gets slashed. It doesn't happen to the salespeople. Nobody goes to the sales people and say, "Hey, we're cutting everything 10%." And the sales executive will say, I'll say, "Okay, well, if you do that, that's fine, but you realize that even if I fire the dumbest 10% of our salespeople sales are still gonna go down 4%, are you okay with that?" And the executive says, "No, no, we don't want that. We had to cut everything because sales were down. All right, no cut for you." But what happens when they go to marketing? The CMO says, "Okay, I'll cut the 10% but you know, our brand awareness is really going to tank." And you know what the executive says then, "Okay, that's great. Let's cut 20% from marketing." Because they don't care about that. What they care about is return on investment and if we can't show them that marketing leads to sales, then marketing is gonna continue to get less funding than it should, because we need to be coin operated. When you put the money in more money comes out and that's exactly what marketing has to be and that's what analytics can do for you. Analytics can also personalize your engagement with your customers. By using analytics you can actually figure out what customers want and deliver it to them. Analytics often tells you what happened already, data science can tell you what will happen. And so one of the overlooked values of analytics is that it can make your company better. And it's not just about keeping score, it's about making improvements based on what the analytics tell you. And so what do we need from our analytics? Well, these are things we're gonna return to throughout the course, but we basically wanna have a customer-centric data model. We wanna know who our customers are, we wanna know as much about them as we can. We need to have automation in our campaign tracking. So we wanna make sure that every campaign has a goal and we're tracking to it using analytics. We wanna have a self-service platform for analytics. You don't wanna have some kind of high priest marketing analyst who's getting all the answers to the questions, you want every rank and file marketer to be able to get answers to their own questions and what that will lead to is a culture that is focused on ROI and is data-driven. So we're making decisions in marketing based on data. And it's not just pie in the sky, better analytics actually drive growth. Firms that are in the top 25% in their use of marketing analytics are 20 times better at attracting new customers, not 20% better, 20 times better at attracting new customers and five times better at retention of existing customers than the companies that are in the lowest 25% in their use of analytics. So if you don't think that that's a real way to make your company better, you're kind of not paying attention. Analytics is where it comes from. If we use our analytics well, there are so many advantages in our decision-making that we're going to be so far ahead of the competition they're not even going to be able to see us. And so one of the things we'll keep coming back to throughout the course is the benefits of understanding your customer's journey better. Organizations that really understand their customer's journey through the buying process have 20% higher customer satisfaction growth, they have 10 to 15% higher revenue growth and 20% reduction in their cost of serving those customers all from just understanding what customers are doing as they go through the buyer journey. And so how will you understand your customer journey better? Well, you will understand what they do before the purchase, you understand what they do better at the purchase, but even after the purchase, as they're using your product or service, and it's your digital marketing platform, that's gonna let you do that, it's going to collect that data that gives you the insight into your customer journey, but it's your data science platform, it's your analytics platform that's going to create the insights that help you to improve that customer journey that's where all the benefits come from that we just talked about. Better understanding of your analytics is what can drive your marketing performance. You optimize your marketing performance by collecting the data, measuring it and using that to calculate ROI. So it's not just operational reporting, which most of you probably do now, as we said, talking about your customer journey, understanding what the customer's doing, and really calculating return on investment for all of your marketing expenditures. And so you can analyze the journey to drive better engagement with your customers. We know that B2B customers, for example, progress more than 70% of the way through their decision-making cycle before they actually contact the company. And so by understanding what customers are doing before they contact the company, that's what's going to drive better engagement, that's what's gonna help you get them to contact you. And most companies need to move from more of a product-centric approach to a customer-centric approach. Right now, you've probably analyzed a lot of things around your product, but maybe you're not thinking so much about how many different products your customers buy, how you can cross sell one product to another, and how you can really satisfy what your customer is looking for with a multiple of the products that you sell them now. And so we're going from kind of a marketer defined buyer journey to a self optimized buying journey. And so right now we tend to think about people coming to our site and buying certain products. But what if we thought about them as being continuously our customers, using our products all the time and actually being shown new opportunities for ways to solve problems with other products that we sell, that's when the customer gets to decide what their buyer journey is. The other thing that we talked about is to make sure that we're not forcing rank and file marketers to have to talk to analytics people or data scientists in order to understand the data. After the fact reports that are interpreted by some expert is a very slow way to use your analytics. A speedier way to use your analytics is with real-time dashboards that every marketer in the company understands. So they understand what data is coming in, they know what the data means, and they can quickly make decisions to improve marketing based on using those dashboards. So we are going to talk about advertising as part of marketing analytics, but too often, that's the analytics that's used the most inside a company. How are our Facebook ads doing? How is our Google ads doing? Are we getting traffic to the site? I'm not saying those things aren't important, they are, but in this course, we're gonna talk about way more than just ads. We're gonna talk about understanding your customer and about driving return on investment from everything you do in marketing, and that's gonna be the game changer in the way you use analytics.