Marketing analytics is no small subject in today’s world of business. In fact, according to Transparency Market Research, the marketing analytics industry is set to grow by roughly 14% by 2022. Why such growth? Marketing analytics has a tremendous impact on a marketing organization’s activities, but also on a brand’s overall understanding of their entire company’s success.
There are four unique benefits marketing analytics provides, and combined together, these benefits give a holistic view of an organization’s past, present and future.
But First: What Is Marketing Analytics and Why Is It Important?
Marketing analytics is a result of the technology and influx of data we use as marketers. Early on, marketing analytics was a relatively simple concept. It encompassed the process of evaluating marketing efforts from multiple data sources, processes or technology to understand the effectiveness of marketing activities from a big-picture view — often through the use of metrics. Fundamentally, it’s all about quantifying the results of marketing efforts that take place both online and offline.
Today, marketing analytics has become an entire industry that’s changing the way we work and the type of work we do as marketers.
It’s important to measure the financial impact of not just marketing but of a variety of efforts from product and sales — which marketing analytics also can provide. As a result, knowing and understanding the different types of analysis and the benefits they provide within marketing analytics, can help to identify what metrics to focus on for what objectives — because objectives can be an endless list of how to understand or increase ROI, monitor trends over time, determine campaign effectiveness, forecast future results, and so on.
The 4 Benefits of Applying Marketing Analytics
1. Learn What Happened
Marketing analytics can first lend insight into what happened in the past and why. This is instrumental to marketing teams in order to avoid making the same mistakes. Through descriptive analysis and the use of customer relationship management and marketing automation platforms, analytics bring to light not only what happened in the past but also provide answers to questions on specific topics. For example, you can ask more about why a specific metric performed the way it did, or what impacted the sales of a specific product.
2. Gauge What’s Happening Now
Marketing analytics can also help you understand what’s currently taking place in regards to your marketing efforts. This helps determine if you need to pivot or quickly make changes in order to avoid mistakes or make improvements. Using dashboards to display current engagements in an email track or the status of new leads are examples of marketing analytics that look to assess the real-time status of marketing efforts. Usually, these dashboards are created by employing business intelligence practices in addition to a marketing automation platform.
3. Predict What Might Happen
Some could say the predictive aspect of marketing analytics is the most important part of it. Through predictive modelings such as regression analysis, clustering, propensity models and collaborative filtering, we can start to anticipate consumer behavior. Web analytics tracking that incorporates probabilities, for example, can be used to foresee when a person may leave a site and when. Marketers can then utilize this information to execute specific marketing tactics at those moments to retain customers.
Or perhaps it’s marketing analytics that assesses lead management processes to prioritize leads based on those similar to current customers. This helps identifies who already has a higher propensity to buy. Either way, the goal of marketing analytics for the future will be to move away from a rear-view strategy to focus on the future. Luckily, the influx of data, machine learning, and improved statistical algorithms mean our ability to accurately predict the likelihood of future outcomes will rise exponentially.
4. Optimize Efforts
This last benefit only comes when you combine your analytics with your market research objectives — but if you do so you could see the greatest impact. In fact, if you’re not ensuring your marketing analytics and market research work together, then you could be missing out on a lot of opportunities. Essentially, it’s about translating marketing analytics findings into market research objectives. A common mistake marketers make in conducting marketing analytics is forgetting to gather real customer feedback. This activity is important to bridge the gap between analytics insights, a marketing strategy and activation.
In addition to the first three benefits or approaches, brands should use marketing research as a tool to push their marketing analytics from just learning about lead generation and sales metrics to actually understand customers in the context of their marketing opportunities.