In my pre­vi­ous post, I intro­duced a “path to value” dia­gram (see below), show­ing the dif­fer­ent key steps required to achieve value from your web ana­lyt­ics invest­ment. The first “domino” in the process is data. Orig­i­nally, I felt it was well under­stood that your busi­ness goals shape or inform your data col­lec­tion, but upon fur­ther reflec­tion I felt I needed to more explic­itly high­light the impor­tance of strat­egy in the process.

My first thought was to add another domino before the first data domino. How­ever, as I thought about it more, I feel strat­egy is some­thing far more encom­pass­ing and influ­en­tial than just an ini­tial step in the process.  Strat­egy truly impacts all of the domi­noes, and it is the foun­da­tion for all of the steps in the data-driven path to value.

In order to show how strat­egy is the foun­da­tion for all data-driven activ­i­ties, I’ll walk through all five of the crit­i­cal areas and iden­tify how strat­egy influ­ences each one in dif­fer­ent ways.

1. Data

In order for the web data to be use­ful, rel­e­vant, and com­plete, it needs to be tied to the online strat­egy and goals of the orga­ni­za­tion. As men­tioned above, a web mea­sure­ment strat­egy ensures the imple­men­ta­tion or set-up of the ana­lyt­ics and opti­miza­tion tools are aligned with key busi­ness goals. No orga­ni­za­tion wants bad data. Irrel­e­vant and incom­plete data can be just as bad as inac­cu­rate data.

2. Report­ing

With­out know­ing the strat­egy or busi­ness objec­tives of a com­pany, it is chal­leng­ing to build mean­ing­ful reports and dash­boards. The best report­ing and dash­boards are finely tuned to mea­sur­ing the per­for­mance of the busi­ness. If you’re not care­ful, over time report­ing can become dis­con­nected from the cur­rent online strat­egy and busi­ness goals.

From time to time, the web ana­lyt­ics team may be asked to re-create a par­tic­u­lar report for con­ti­nu­ity rea­sons. Before mov­ing heaven and earth to accom­mo­date the request, some­one needs to hit the pause but­ton and ask “why does this report exist?” and “is it still rel­e­vant to the busi­ness?” Rather than repli­cat­ing his­tor­i­cal reports, which are based on an out­dated strat­egy with poten­tially dif­fer­ent (and prob­a­bly for­got­ten) busi­ness goals, you need to deter­mine if those reports should be replaced with more rel­e­vant, mean­ing­ful ones tied to the cur­rent online strategy.

3. Analy­sis

Ana­lyt­ics tools such as Site­Cat­a­lyst, Dis­cover, and Insight pro­vide a rich set of web data for com­pa­nies to ana­lyze. In most cases, you have more data than you know what to do with. In addi­tion, your ana­lyst team has mul­ti­ple analy­sis requests pour­ing in each day or week from dif­fer­ent parts of the busi­ness. When ana­lysts have a clear under­stand­ing of the online strat­egy and key busi­ness goals, they can pri­or­i­tize which analy­ses to pur­sue, post­pone, or ignore. Most com­pa­nies have lim­ited ana­lyst resources so knowl­edge of the busi­ness strat­egy is crit­i­cal to ensur­ing that they use their time effi­ciently. It’s eas­ier to push back when analy­sis pri­or­i­ti­za­tion is based on what’s most impor­tant to the busi­ness. Keep your ana­lysts’ eyes focused on the prize.

4. Action

Analy­sis is only valu­able if it is acted upon. Strat­egy influ­ences the actions that com­pa­nies take once they have use­ful analy­sis insights to act on. Sim­i­lar to how strat­egy can guide pri­or­i­ti­za­tion for analy­ses, it can also help pri­or­i­tize which rec­om­men­da­tions to pur­sue or which tests to run in Test&Target. Strat­egy can also instill a greater sense of urgency among the teams exe­cut­ing on any rec­om­men­da­tions. With a shared under­stand­ing of the key busi­ness objec­tives, mar­ket­ing and IT teams can rally around strate­gic projects, which need sup­port in “jump­ing the queue” over lower pri­or­ity projects.

5. Busi­ness Value

Strat­egy deter­mines the max­i­mum poten­tial value that a com­pany can achieve from its data-driven ini­tia­tives. A poor or weak strat­egy will limit the over­all poten­tial value. You can be solid in all other areas (e.g., great imple­men­ta­tion, insight­ful report­ing, skilled ana­lysts, action-oriented teams, etc.), but the busi­ness value gen­er­ated will never exceed the bound­aries set by a weak strat­egy. On the other hand, a sound strat­egy can pro­vide end­less value to an orga­ni­za­tion. The capac­ity of the data, report­ing, analy­sis, and actions to drive value for the com­pany will ulti­mately be defined by its strategy.

Yin and Yang

An inter­est­ing thing hap­pens when a company’s strat­egy influ­ences all of the key areas in the path to value. At first, data will begin to guide or opti­mize busi­ness tac­tics. Then even­tu­ally you will see insights from the data shap­ing or influ­enc­ing your busi­ness strat­egy. A sym­bi­otic rela­tion­ship between the strat­egy and data is formed — a sort of opti­miza­tion yin and yang. Both areas need to be bal­anced so that they can com­ple­ment and ben­e­fit each other.

For exam­ple, no mat­ter how quickly or smoothly the imple­men­ta­tion goes, it’s all worth­less if the data isn’t closely tied to the busi­ness strat­egy. With­out the influ­ence of a well-defined online strat­egy, data, report­ing, analy­sis, and actions are not going to drive the antic­i­pated lev­els of value. As Peter Drucker poignantly stated, “There is noth­ing so use­less as doing effi­ciently that which should not be done at all.” When ana­lyt­ics resources and time are con­strained, hav­ing a clear strat­egy is crit­i­cal to data-driven suc­cess. It will make sure your com­pany is mea­sur­ing and test­ing the right things, and then over time the data insights will start to refine and improve your online strategy.

Strat­egy informs data. Data informs strat­egy. Yin and yang.

1 comments
Adam Egbert
Adam Egbert

Great Post, Brent! Often, I find clients either do not have a consistent strategy or do not follow the strategy in place. The result is the dominos fail to connect and full value is not realized. Execution on that strategy is essential. Best, Adam Egbert Technical Consultant Adobe Consulting Services