Now more than ever before businesses have tons of data on what customers want. Too bad they don't have a clue what to do with it.
Compiling massive sets of data and analyzing them--so-called big data--was supposed to be a boon for business. (And a PR nightmare for the NSA.) But according to a survey from digital marketing software company Lyris and conducted by the Economist Intelligence Unit, many companies are well behind the curve, as well as national spooks.
According to the survey of 257 marketing executives, 45 percent said that they lacked the capacity to analyze big data, while a full half didn't have the budget to pay for digital marketing and database management. A lack of competence in analyzing data was cited as a major obstacle to implementing more effective strategies according to 45 percent of the executives.
Those who could afford the analysis and had the skills to pull it off, at least in theory, found that, in fact, they didn't get much bang for the buck. Only 24 percent said that they always used big data for "actionable insight." And only 27 percent said that "they always integrate customer data from different sources into a centralized customer database." As Lyris put it, marketing executives often ignore big data because they find it confusing.
Because of the confusion and lack of knowledge, marketers are missing the boat in some big ways with consumers:
Email is underestimated--Email is dead, right? Nope. About 37 percent of consumers ranked email as a top channel for pre-purchase decisions, while 52 percent said email was most important for post-purchase interactions. However, companies put more of their budgets toward websites, not email.
Mobile and social are overhyped--Talk to marketers and pundits and you'll hear a lot about how mobile and social networks are incredibly important. And they are, in terms of learning and investing for the future. But for now? Consumers said that the two had the least influence on purchasing. Executives, on the other hand, ranked social responses as the third most important key performance indicator, following only sales and response rates. Although 62 percent of consumers liked social for product promotions, they like to learn about products via company websites, email, or third-party websites.
Personalization is overdone--About 63 percent of consumers find marketing personalization pervasive enough that it has become useless. The surprise and shock factor are gone. A third of consumers said that personalization was one of their top annoyances and 70 percent say that the practice is superficial. And yet, personalization was the number two marketing strategy.
Marketers don't get privacy--The use of data collection and analysis bothers consumers and 49 percent say that they're concerned about threats to their privacy. Marketers, though, think only 23 percent of consumers are concerned.
Not only don't marketers get data, they don't get what consumers want in communications. Until they sharpen up, you can count on more spending--with lackluster results.