Opening the Treasure Chest – The True Purpose of Analytics

On from Analytics Culture, Digital Analytics, Governance, Interactive Marketing

This is probably the 907th article about Analytics you have read this month. Not all, but certainly the vast majority of them are most probably about how darn fantastic data and analytics are, and that you should do it, and that you should become a data-driven company, etc. Very few of them will simply state the most important thing you should be doing with all that data:

Making money.

Yes, money. More precisely, creating value; value as in increasing revenue, lowering costs, increasing customer loyalty, what have you. This is ultimately what Analytics is for. Not Big Data, not analytics culture, not smart technology platforms, not being data-crive. Finding value. That’s what it’s for. That’s it. I’m sure you appreciate the simplicity of the statement here.

Yes, you could put analytics to work, and save the world, and I hope someday will do more of that. But I’m in Marketing, and I’m sorry to say: if there’s no substantial gain to doing analytics in business compared to, say, not doing it, we’re wasting our time. And that gain should be value.

As a mental exercise, ask yourself what you would lose if you entirely stopped doing Analytics tomorrow. If you’re not able to answer that question, or worse, if the answer is “not much”, it is about time you re-evaluate the true value of analytics in your company.

At the very least, Analytics should pay for itself. As analysts, you should, again at the very minimum, find enough money to cover what you cost! Suer, the link between some analyses and finding new value can sometimes be blurred, but on the whole, over the course of the year, Analytics should be able to demonstrate its direct impact on new value creation.

Compared to most other functions in Marketing (design, media placement, coding, etc.) that are all contributing, Analytics has a more immediate connection with results, exposing them, and especially describing why and how those results were realized, thus being able to make strong recommendations on how to exploit new opportunities, even if they are only within the optimization loop.

Make finding, and clearly exposing value the main focus of your Analytics program. You will see: by doing that, your organization will become data-driven before anyone realize it.

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