The Risk of Marketing Data Analysis
Consumer goods manufacturers make enormous investments implementing systems, acquiring information and purchasing data from third-party providers to uncover new ways to further penetrate and expand their customer base, while cornering the competition. Market and brand success is largely dependent upon understanding the bigger picture and making connections between different data sets.
However, tools available to aid brand managers and market researchers have not kept up with the increasing amount and complexity of data, thus creating more market confusion and information paralysis. Fortunately, technological advancements are better enabling marketers (and the IT staffs that support them) to evaluate multiple data sources simultaneously for a better understanding of marketing effectiveness, profitability, pricing and changing consumer buying habits.
More Than A Feeling
Many brand teams or researchers currently rely upon "gut feeling" and "creativity" rather than on conclusions based on thorough data analysis, because the majority of analysis tools designed to assist them are complex or ill-suited to the task at hand. Highly specialized software tools are available for solving narrow problems, such as optimizing shelf space layout or performing in-depth analysis on consumer surveys data, for example. At the other end of the spectrum are reporting tools and their widely consumed reports generated by the syndicated data providers, such as ACNielsen and IRI. The separation between these two choices has created a sales and marketing "Analysis Gap" that hampers the ability of marketers to understand the varied volumes of data and to truly get a grasp of market opportunities and risks.
Organizations will base their most critical business decisions on their understanding of market data, inevitably (and often irreversibly) impacting brand loyalty, customer relations and, ultimately, revenue and growth. Unfortunately, in this environment many of these decisions suffer from a mix of excellent data and incomplete analysis. And as technology provides new methods of data capture, such as the monitoring of consumer purchasing behaviors via buyer discount cards, the amount and types of market data as well as the need for better sales and marketing analysis will only grow.
Unified Analysis
The "Analysis Gap" and the growth of customer and market data has led to the emergence of a new class of visually interactive analysis tools that enable analysts, researchers and managers to analyze internal and external data in one unified analysis environment, freeing experts to focus on research instead of pulling together data and building reports. Users simultaneously analyze information from industry data sources such as ACNielsen, IRI and IMS, in conjunction with data from internal systems such as SFA, CRM, POS and ERP data sources. These analytical applications and processes provide information advantage and market insight by enabling sales and marketing decision-makers to quickly and easily identify and drill into trends, patterns, outliers and unanticipated relationships in market and sales information across multiple data sources without the burden of IT integration or complex computations.
Visual data analytics push beyond "what" and into "why" in sales, syndicated market, consumption and survey data to bring true market intelligence to marketing and sales force execution. The highly visual analytical environment empowers sales and marketing analysts to quickly find unique and often missed patterns in market and segmentation data that can be dynamically adjusted at any geographic level, national or DMA, and immediately overlaid on interactive maps. For example, one such company -- Spotfire -- has a marketing analytics product that pulls together syndicated scanner data, consumer panel data, and internal shipment and CRM data to provide greater insight into shifts in consumer demand and consumer segments. The analysis also supports the integration of external factors such as data about the weather to look for drivers of demand. With all data in one environment, market researchers and brand teams are free to explore the information and generate real market insights, without generating multiple reports.
Given the constant movement of the retail and consumer environment, greater flexibility in analyzing all available data quickly benefits the brand team. Syndicated market data, shipment data and distributor information is readily available to organizations; yet, most current methods for analyzing this data involve complicated spreadsheets or static reports that are automatically generated every Monday morning. When problems are spotted, these methods are not flexible enough to support rapidly changing conditions that require immediate decision-making. In another example of interactive, visual analytics at work, Spotfire's marketing analytics product pulled in data from a handful of sources and presented a unified view of channel and key account performance. Outliers in the aggregated data were immediately spotted, and movement in strategic accounts was swiftly identified, thanks to the highly visual displays.
Consumer goods organizations are awash with data, yet most brand teams have only begun to scratch the surface of extracting value from it. Taking advantage of the volumes of data need not involve complicated statistics systems or costly consulting and services engagements. By leveraging technology advancements used in other data-rich and analysis-driven industries, consumer goods manufacturers can gain invaluable insight into their market and get a jump on the competition.
ABOUT THE AUTHOR
Francesco Leone is chief marketing officer and member of the founding team of Roasting Plant (www.roastingplant.com), where he is responsible for the company's marketing strategy, fund raising and board recruiting. Francesco previously served as a principal at Mavens & Moguls, a strategic marketing consulting firm and held senior marketing positions at The Coca-Cola Company, Starbucks and Colgate-Palmolive. He has been a speaker on marketing strategy at European and U.S. universities. Francesco lives in Atlanta, Georgia, with his daughter and wife.