Ryan Murdoch believes analysts that are comfortable in vast amounts of data can quickly find insights.
‘Big data’ has been one of the biggest buzz words thrown around the media industry in the past few years, and for good reason. Looking at the leading global companies across industries, nine out of 10 are ahead of the curve when it comes to using data to inform decision-making.
So, for obvious reasons, the interest in applying a proper data and analytics approach within media is high amongst key business leaders, and our belief at SMG is that this practice will define the successful companies of the future. However, there are some real challenges facing the industry in this region and we need to play catch up if we want to truly unleash the potential that data and analytics can bring.
What we are continuing to see, at a broader level, is the evolution from what has been coined as Analytics 1.0 moving into Analytics 2.0. That shift is based on the tsunami of data that is now available from the massive growth of digital. As a result, traditional form of analysis, such as marketing mix modelling (econometrics), simple correlations and management through spreadsheets is morphing into a position where companies can make decisions on the fly and course correct as things are happening. Yet, in order to do this, it requires a concerted strategy around four key areas.
Not all data is good data and it’s about being clear on what types of internal and external sources impact and add value to your business. Also, defining what area of the business you are focusing on will help (e.g. support of sales, marketing, logistics, etc.) Just storing mountains of data and hoping to glean insights isn’t going to work. It all starts with deciding what you want to achieve. So step 1 requires defining this purpose and then sourcing, managing, storing and integrating the underlying data.
Now that you have this data, what to do with it? A lack of skills and talent is a real obvious barrier in the region, there’s no point in collecting all this data if it’s just going to sit there and not be used and for that, you need different skills than historically you might have used. You need skilled people that can make sense of it with systems, math, statistics and econometric backgrounds. The key difference in the new world is having analysts that are comfortable in vast amounts of data and can quickly find insights. Companies can no longer play lip service to it, so building dedicated teams will be crucial in the new age of data and analytics lead organisations.
Doing the math right: If you don’t get the math right, you won’t get the attribution right. The industry will eventually move in this direction and data analysis will be a combination of aggregate analytics, like MMM, as well as event-level data analytics, based on people and cookie data. Both will become more real-time over the next three to five years, as the analogue world continues to move to digital platforms. This has been coined as Analytics 2.0: machine-based analytics that churn through huge volumes of data with the ability to auto model results.
Organisational behavioural shift, from my experience, is the biggest challenge. You can be sitting on the best data, with the best analysts and if you are not willing to act on findings and insight then it all goes to waste. I have seen numerous companies fall into this pit and, regrettably, learned from being part of one of these companies, which invested in steps 1, 2 and 3 but neglected this final area. The whole organisation needs to get behind it and management needs to push this from the top down.
How do you change behaviour when you have decision makers who have been working the same way for many years? You not only have to train them to act and think differently, but also supplement their skills with new people from this new world thinking.
In summary, media and marketing isn’t an exact science, and I say that as an analyst! As we know, the communication world is far more complex place then it was even five years ago.Consumers have so many more opportunities to connect with brands across all the paid, owned and earned (POE) channels, in which we all now operate.
What data allows you to do is back up hypothesise, prove theories, help measure performance and optimise accordingly. There is a quote from the infamous Peter Drucker, which says, “What gets measured gets managed.” This is as true today as it was in 1954. Data should be used to inform decision-making and help manage performance. Media has always been about creativity and the emotional experience. However, data-based decision-making can only help in defining the most effective way of bringing these experiences to life.
Pareto’s 80/20 rule is still very much relevant today.
(Ryan Murdoch is head of data and analytics at SMG MENA & emerging markets)
