While presenting at an online marketing conference, I was reflecting on the importance of strategy for analytics and optimization. At a high-level, strategy can be defined as a plan of action or initiatives to achieve a set of business goals or objectives. Well-known strategy guru Michael Porter stated “a strategy delineates a territory in which a company seeks to be unique.” It’s the secret sauce. It’s what sets your company apart from its competitors.
As such, strategy should always influence the implementation or set-up of your analytics and testing tools. I know of very few “vanilla” or “cookie-cutter” companies that need generic implementations. In order to collect the right data that is relevant and complete (let’s not forget accurate), your metrics need to be based on the unique business goals of your organization.
As I’ve worked with several different global leaders, I’ve discovered outwardly similar companies needing different configurations in their implementations based on their unique strategies. Although one retailer may share many of same KPIs as other e-commerce sites (e.g., revenue, AOV, conversion rate, etc.), there are often unique requirements specific to each retailer. Differentiation can and should spill into the data.
Winston Churchill said, “However beautiful the strategy, you should occasionally look at the results.” Having a web measurement strategy in place ensures your company is able to monitor the success or failure of its online initiatives. It aligns different data dimensions, KPIs, and reports to your business objectives so that your company can effectively measure its online business performance. As you can imagine, it’s difficult to align your implementation to an unknown strategy. And yet I still find our consultants working with large, well-known companies that seemingly cannot clearly articulate what their current online strategy or business goals are.
Why is the strategy part so challenging for companies?
Both web analytics consultants and practitioners alike would probably agree aligning an implementation to a company’s business goals as one of the most important steps — but also one of the most difficult to accomplish. Why can it be so difficult? I’ve identified three roadblocks that can create problems.
1. Tactical focus
Web teams are really busy handling the onslaught of daily tasks — launching new paid search campaigns, managing site updates, planning the next site redesign, creating new online surveys, building ad hoc reports, testing new landing pages, etc. Workforce reductions in the last couple of years may have burdened these teams with more responsibilities and less resources to complete them (let’s not forget the smaller training budgets). They are essentially struggling to keep the online boat afloat — bailing water while trying to keep the sails up. However, I frequently find that not enough people have stopped to check if the boat is heading in the right direction.
They might be meandering in a generally safe direction, about to hit the rocks, or already shipwrecked — and nobody even noticed. Even when an individual or team isn’t clear on the company’s online strategy or business goals, they will continue to diligently focus on accomplishing their day-to-day, tactical responsibilities. The default setting in most of us is to keep busy, keep our heads down, and get things done — not wait around for an online strategy to be provided or clarified. Good tactical execution is important, but strategy ensures that efforts are not wasted on the wrong activities or goals. As Sun Tzu stated, “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.”
2. Organizational dynamics
Too often the online part of the business is treated more like common land, which in feudal times was land shared by the community for grazing herds and gathering firewood. In large organizations, multiple divisions or teams share parts of the company’s online presence, but nobody oversees the overall online business. As a result, there is frequently no overarching online strategy or shared business goals that unify each group’s focus.
In some cases, the online parts of a business can turn into a political battleground with different groups wrestling for control. You don’t need 14 different business divisions and worldwide operations to experience politics because even small companies have run into the same conflicts. With each team interpreting the organizational goals independently, it becomes very difficult to prioritize and align a web analytics implementation to vague or conflicting business objectives. Whether or not your company’s decision making is centralized or decentralized, having a clear online strategy is always a best practice and essential for creating a global view of a company’s online performance.
3. Inadequate discovery process
One of the most important steps is to involve all of the key stakeholders in the discovery of the organization’s business requirements and clarification of the online strategy. Sometimes a single person or group may feel they can represent the needs of the entire company to save time, and not all of the stakeholders need to be bothered with the discovery process. Despite the best of intentions of these individuals, I’ve seen this approach fail on multiple occasions.
In one example, an internal, two-person task force at a travel company brokered and controlled the entire discovery process despite repeated requests from our consulting team to involve additional stakeholders within their organization. When the final web reports failed to meet the needs of several senior executives and teams, access to other stakeholder groups suddenly opened up but the company was still forced to re-implement significant parts of its SiteCatalyst solution.
Different parts of the business (e.g., marketing vs. support) may have dissimilar goals, priorities, agendas, requirements, and KPIs. Each group may also have varying degrees of analytics experience. Throw into the mix the fact that online business needs and priorities are not static, and the Internet seems to be constantly reinventing itself every 6–12 months. Hopefully, you see why it’s important to be inclusive in the discovery process in order to properly gather, refine, and align the implementation to the key business goals and requirements. Two familiar proverbs come to mind: “Measure twice, cut once” and “Haste makes waste”.
Leadership is the answer
The strategy part becomes much easier when a sometimes missing ingredient is added — leadership. Michael Porter defined the role of leaders as “more than just stewardship of individual functions” and at “its core is strategy: defining and communicating the company’s unique position, making trade-offs, and forging fit among activities.” I would also add holding individuals and groups accountable for achieving the business goals outlined in the online strategy.
When leaders clearly articulate the online strategy to employees and teams, those individuals are empowered to be more strategic with their tactical responsibilities. I still recall the time when I was interviewing a large group of product marketing managers, and they asked me to let them know what the web strategy was when I got it from their senior management team. Sun Tzu wouldn’t have been impressed.
Despite a company’s complex organizational structure, the right level of leadership can align different individuals or groups around a unified online strategy and minimize the politics. When I was helping a media company to define its web measurement strategy, I was noticing very diverse interpretations of organization’s online strategy and KPIs from its different teams. However, as soon as a senior executive clarified the online strategy and priorities, everyone’s business requirements quickly fell into step with his direction or vision.
Leadership can play a key role in ensuring that the right people are participating in the discovery process. Typically, you want to go “high and wide” in terms of the groups and individuals that are involved in the discovery process. Leaders can make sure that all the right people are not only involved but also committed to the requirements gathering process, which can save time as scheduling and advance preparation can be challenging. For example, a C-level executive at a multinational retailer was able to involve EVPs from its offline advertising and purchasing/merchandising groups, who wouldn’t normally have participated in online strategy discussions. However, he was able to convince them that the value of web data extended beyond just the online channel in a multichannel retail world.
As the famous business professor John P. Kotter stated, “Leaders establish the vision for the future and set the strategy for getting there.” Effective leadership plays an integral role in not only establishing the strategy but also ensuring that business performance can be measured against the defined strategy. When the right measurement is in place, individuals and teams can be held accountable by leaders for reaching the desired goals. Good leadership can help your organization overcome the three challenges mentioned above and is critical to achieving data-driven success.