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December 1, 2014
Russell Glass

6 Steps to Build a Data-Driven Marketing Department

CMOs want to be data-driven marketers. That’s clear. A recent survey conducted by the Association of National Advertisers and McKinsey & Co. found that 96% of CMOs think that making “data-informed decisions” is crucial to their company’s performance.

What is less clear for CMOs is how to create a data-driven marketing department at their own companies. In the joint survey, “Marketing Disruption: 5 Blind Spots on the Road to Marketing’s Potential,” almost half of respondents said that they don’t have the right analytics in place to make data-driven decisions.

Big Data is an intimidating term, but taking the steps necessary to build a data-driven marketing department doesn’t have to be intimidating or complicated. Follow these six steps, and your company can quickly benefit from the insights that data can deliver, showing you what your prospects and customers want and need.

Step 1: Know your customers. If you understand who your customers are, you should have a good idea of who your prospects should be. Data about your customers often is hiding in plain sight: in e-commerce data, in e-mail databases, in a customer relationship management system or in accounts receivable. Analyzing the data in these silos can help you determine what your best customers have in common—which, in turn, will help you better identify the prospects that the marketing and sales teams should be courting.

Step 2: Start small. A good place to begin is your company website. Inexpensive—or even free—analytics tools can help identify the basic demographics of who is visiting your website and what content they are viewing. If you know these two facts, you can serve more targeted and appropriate content to visitors when they are on your site, and also when they are elsewhere on the Web with display and social advertising.

Step 3: Hire the right people. The days of the marketing department solely being a refuge for creative, right-brained people are over. CMOs also need left-brained, data-oriented staffers to help run demand generation programs and analyze data. Matt Ackley, CMO and senior vice president of product at Marin Software, said that building a data-driven marketing team poses two key challenges. “One is getting access to the data, and the second piece is finding the analytics people who can do something with the data.”

Step 4: Make sure that your technology works together. There are basic technologies that most companies need in this digital age: a CRM system, marketing automation software and an analytics tool. When properly integrated (which usually requires that marketing has a strong and respectful working relationship with information technology), these tools can help marketers gain deep insight into how marketing programs, ranging from e-mail to search to display and social advertising, are pushing prospects through the marketing funnel.

Step 5: Measure. I can’t stress this enough. A marketing department can’t honestly call itself data-driven if it’s not measuring how well its programs are building awareness at the upper funnel, driving engagement in the middle funnel, and converting prospects into leads in the lower funnel. Using the right software, the most effective CMOs now are able to measure marketing-sourced revenue, finally proving to the rest of the company what the marketing department already knew: Marketing contributes to the bottom line.

Step 6: Take care of your data. In far too many companies, customer and prospect data are scattered in too many departments. Sales controls the CRM data. Marketing has marketing automation. Accounting has payment data. And IT might have e-commerce sales data. Your company should strive to have a centralized database with a 360-degree view of the customer, and I believe that the CMO should be responsible for this database. The CMO is in the best position to make your company a data-driven, customer-focused business.

Don’t wait. Don’t be intimidated by Big Data. Start small and then ramp up—and make sure that you do it before your competitors do.

Russell Glass is head of B-to-B Product at LinkedIn, and co-author of The Big Data-Driven Business: How to Use Big Data to Win Customers, Beat Competitors, and Boost Profits. A serial technology entrepreneur, Glass formerly was CEO of Bizo, the marketing platform recently acquired by LinkedIn. He is based in San Francisco.

For more on embracing data-driven marketing, check out Russell Glass’ webcast, ‘Using Data-Driven Marketing to Become a Big Data-Driven Business,’ at AMA.org/Webcasts.  

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