Companies are still struggling to apply data in support of broader business objectives, even while recognising its primacy as a competitive advantage. That’s the headline from a report by the Winterberry Group, IAB and Oracle Marketing Cloud.
Called “Data as a competitive advantage“, the report notes that Big Data has gone mainstream — raising an important question: “If everyone is ‘data-driven’ in both theory and action, how can businesses carve out meaningful competitive differentiation through their use of information?”
As ever, it turns out the devil is in the detail. Some companies just do data better than others.
According to the report, “Overwhelmingly, marketers and publishers see competitive advantage as something that’s driven by a better understanding of their customers — and better-informed deployment of the media channels and technologies that power engagement with the same.”
Perhaps not surprisingly, say the authors, these companies see their greatest data-driven successes linked to their collection and segmentation of first-party data which is turn is used to drive richer, more actionable view into their customer interactions.
“A majority of panelists — 52 per cent — said they had achieved more than ‘average’ satisfaction with the performance of their first-party data assets. By contrast, just half that number — 26 per cent — expressed similar satisfaction with the contributions of the third-party data assets they’ve used in supporting their marketing, advertising and/or media initiatives.”
The other problem at the coalface of this new approach to marketing is that data practitioners continue to struggle with a significant performance gap when it comes to applying audience data in support of broader business objectives.
“Though large numbers of marketers and publishers continue to see basic enterprise needs — such as ‘growing revenue’ and ‘improving profitability’ — as the fundamental (and expected) outcomes of their data-related investments, relatively few have succeeded in meeting their expectations with respect to audience data and its contribution to those baseline performance goals,” according to the report.
The conclusion suggested by the authors is that future competitive advantage will be grounded in how practitioners use data to support their unique needs.
Joining the dots
Measurement continues to be a significant issue. “Despite the critical role that reporting and attribution play in substantiating the value of various media and marketing investments, efforts to measure the true value of data have generated only modestly useful insights thus far (though users remain committed to elevating the practice so that they can measure data’s net contribution to desired business outcomes).”
Indeed, the universal response from executives on the business panel that formed the basis of the research was that even though they had deployed basic tools to measure the value that data contributes across their advertising and marketing efforts, a bare majority of respondents could only determine mild contributions to the business. “Only 16.3 per cent said they can measure it ‘very well’.”
Worse still, there was no consistent view of how to improve performance. On this point, “‘Better data technology’ captured the interest of a greater share of the panel (47.9 per cent) than any other, edging out ‘more first party data’ (41.7 per cent) and even ‘standardised metrics and KPIs for measuring data’s contribution’ (39.6 percent).“