Data Is The New Commodity

Think data is the answer to all your creativity dreams? Think again.

Last year will undoubtedly go down in the marketing world as the year of data. Never have we seen so many presentations, articles, and meeting agendas ending with a call to arms for data to merge with creativity and ride off into the sunset.

Data, we’re told, will usher in a new era in design. It will be the savoir of brands and agencies. It will throw customers headlong into our arms. In fact, if you’re a marketer today and lack a data story, you’re really behind the times. That’s probably why Dentsu paid a premium for data-driven agency Merkel, RocketFuel serves 96 of the Fortune 100, and IBM is growing its marketing services arm. Data Scientist is now the hottest job title in the industry.

However, if you dig a little deeper, you’ll find that talk and reality are quite different things. CMOs may go on endlessly about the need to connect data to decision-making, but it is actually informing a slightly lower percentage of marketing decisions than it did in 2012. Marketers also say they’re spending under budget on data resources.

Part of the reason is that we’re missing a key point: data is not a source of sustainable competitive advantage. Thanks to effective adaptation to marketplace demands, Data-as-a-service providers, such as Axciom, Oracle, and Amazon via AWS, are making their data more accessible and approachable than ever.

As a result, all the brands in a category have access to roughly same third-party data. Agencies can’t subscribe to enough data sources to effectively differentiate themselves from each other or the data sellers that have whispered in their clients’ ears. A brand’s first-party data is really the only source of competitive advantage, even though it’s probably much the same as its competitors’. As a result, marketing has become a car race in which everyone has the same engine.

In addition, while more brands are using data, the ways they can leverage it are not growing. Direct marketers have been using modeling methods – like Monte Carlo simulations, linear regression, and probability trees – for decades. The data-driven methods used by digital marketers rely on ID-level tracking, behavioral segmentation, and reporting from sources like Google’s Doubleclick, Facebook’s Atlas, and Amazon. These platforms continue to add targeting capability, but not at the pace pundits would lead us to believe. As a result, some brands are targeting less not more.

At the same time, it’s crazy to say data doesn’t matter. It’s the new reality with the potential to inform more decisions than ever before. With the right people, processes, and culture we can harness it, but there are a few key steps we must take.

Marketing Strategy Must Be Holistic

Most large organizations have already made marketing cloud investments that will undoubtedly create value over time. But we also need classic strategic approaches to inform them. We still need to develop a brand strategy, connect it to high-value consumer segments, develop a media and channel plan, and have a clear approach to measurement. To do this, we have to end current practices where data and technology sit in siloed departments. Everyone wants to be known as being in the data game – which is fine – but we need to do it in a thoughtful, unified way.

Separate Insights From Data

Not long ago agencies trained market researchers and strategic planners on the difference between a fact and an insight. Today, finding insights appears to be a lost art. We need to redefine and re-ignite the practice , making sure we connect data to things we can act on, rather than think about.

Swing The Pendulum Back To Creativity

While it’s great to measure, it’s better, especially for agencies, to focus instead on the behavioral insights that drive creative ideas. From an agency standpoint, it’s difficult to win the data war against consultants and technology platforms. But with insights-driven ideas, they can easily hold their own.

Above all, it’s time to stop talking so much about data stories and recognize that it has become highly commoditized. Though indispensable, it is not differentiating. The real way to set yourself apart lies in how you apply well-known creative and strategic lessons to a realm where data is now king.