After experimenting with my own personal blog over the past year, I figured it was about time that I ventured into the world of corporate blogging. Some of you may have had the opportunity of attending my Omniture Summit 2009 presentation on the “7 Keys to Creating a Data-Driven Organization”. Others of you may have seen the same presentation as a free webcast provided by our marketing team.

Through an upcoming series of articles, I will examine each of the seven key success factors of data-driven organizations in more detail. But before I do this, I want to discuss why being data-driven is more important than ever for organizations and why so many companies still struggle with it.

Why Be “Data-Driven”?

In times of economic growth like we experienced from 2005-2007, too many marketing decisions were made based on intuition and gut instinct. Too frequently marketing initiatives were not tied to success metrics or even measured at all. Holding people accountable would have interfered with working on the next big project or campaign. Between the abundance of “low-hanging fruit” and the sheer volume of work to be done, mistakes could be masked or conveniently overlooked.

Now with the recent economic downturn, companies are being forced to scrutinize their marketing spending more closely. Many CMOs have had to significantly cut their advertising budgets, and they have to do more with less. They want to understand which campaigns, marketing channels, and online content are the most effective so they can get the most “bang” for their marketing dollars. In addition, more and more advertisers are shifting budget away from traditional channels to more measurable digital channels such as paid search, email, social media, etc. In a down economy, data is proving to be a marketer’s new friend.

Why Is It So Difficult to Be Data-Driven?

In my five years as an Omniture consultant working with several Fortune 500 companies, I’ve repeatedly seen how organizational issues — not necessarily technical ones — have impeded the success of many well-meaning companies in the area of web analytics. Becoming data-driven requires more than just tools or technology – it requires supporting processes and people. Too often companies obtain the necessary technology but don’t add sufficient resources or make changes to their existing internal processes or culture.

Web Analytics / Garden Analogy

When discussing the challenges that organizations face in becoming data-driven, I like to compare web analytics to gardening. Just like in gardening, people, processes, and tools are equally important in web analytics. By considering all three areas, companies are more inclined to become data-driven and successful in even a down economy.

People

Looking at the “people” aspects of gardening, you have the owners of the garden (senior executives) who determine what the priorities are for the upcoming “harvest” (reporting and analysis). They determine what “crops” (data or reports) are needed to sustain the organization. Second, you have the actual gardeners (technical staff) who grow the desired fruit or vegetable plants (implement the tagging strategy). Third, you have the harvesters (business analysts) who collect and distribute the “produce” to the organization when they’re ripe.

I have seen companies run into problems when executives do not participate in defining business requirements or deciding what data is needed. After the “harvesting” has occurred, it’s painful to find out from executives that key reports or metrics are missing. I’ve also seen cases where companies don’t have sufficient or effective harvesters – leaving valuable data to “rot on the vine”.

Processes

Similar to gardening, processes are equally important to web analytics. Besides planting (implementation) and harvesting (data analysis), there are several other processes that impact the success of web analytics at an organization. Your web analytics may need to be “weeded” (data validation) on a regular basis to ensure that the data is accurate. A consistent “watering” (training) schedule may be important to data adoption within your company. Just like in gardening if you skip a key step in web analytics, it can undermine a lot of hard work in other areas. What’s the point of planting an extensive garden if you’re not willing water or weed it?

From an overarching process perspective, it may also be important to think of your web analytics as an ongoing program rather than just a one-time initiative. Some companies may feel as though they have instituted a web analytics “program” but have really just launched their web analytics as a “project” (e.g., no training or requirements gathering after the initial launch).

Tools

When I refer to “tools” of a data-driven organization, I am referring to more than just enabling technologies such as SiteCatalyst or Discover. These products may be the shovel or hoe of web analytics, but I consider other utensils to be equally important to establishing and maintaining a successful web analytics program. For example, a web measurement strategy is a valuable document in ensuring a company’s online initiatives are aligned with its overall objectives and appropriate KPIs are predefined for measuring performance. In addition, larger organizations may benefit from a corporate standards document that defines how variables are allocated and how page tags are to be instrumented. Indeed, there are many complementary tools – outside of the actual analytical tools themselves – which contribute to the success of people and processes at data-driven companies.

Author Rudyard Kipling once stated, “Gardens are not made by singing ‘Oh, how beautiful,’ and sitting in the shade.” Getting your web analytics program in order and creating a data-driven company is going to require some work. In my next blog post, I will examine the first key to creating a data-driven company — securing an executive sponsor.

8 comments
Reuben Poon
Reuben Poon

Great article. I'm excited to see what you'll be bringing to the Omniture side of your blogs. Has anyone read Patrick Lencioni's Death by Meeting? I see similarities between why people are "bored" by meetings and analytics. Lencioni's take of the issue is very interesting and might lend itself to making analytics more interesting and compelling across an organization. Thoughts?

Dave
Dave

You could use endless analogy's and I kinda agree that management team is afraid of seeing a project that appears not to be doing well in the limelight. Its much easier just to say we did this as compared to we did this and this is what happened or even what we will change to see if we get better results.

Jonny Longden
Jonny Longden

For me, its more basic than that. The main reason that companies find it hard to become data driven is that their analysts (and in turn their analysis service providers) talk to them too much about data, tools and reports and not enough about performance improvement. Most business leaders and marketing people are either secretly or openly bored by analytics, but if you leave the data behind the scenes and talk to them about making money and selling stuff then you have their attention. We have to remember that the output of analytics is NOT analysis, its business performance improvement.

Adam Greco
Adam Greco

Great blog post Brent! I love the analogy. I look forward to reading more...

Michael
Michael

Thanks for the post Brent. I like the analogy. It reminds me of some of the projects that I do at work. We'll get the project done but sometimes resources are limited to support the new feature or improve upon it.

Brent Dykes
Brent Dykes

I think you make a good point, Jonny. Tying your thoughts into the garden analogy, do companies always care about the "produce" (reporting or analysis) or the actual "meals" (performance improvements, sales/marketing/support actions, etc.) that come out of setting up a solid web analytics program. Although everyone may enjoy a raw carrot or apple from time to time, it may not be enough to simply bring the vegetables or fruit to the organization to consume. As you propose, it's more about "what's for dinner?" with executives or what "actions" can be cooked up with these ingredients that will drive change. I can buy that.

Brent Dykes
Brent Dykes

Thanks Adam. I'm looking forward to this blogging adventure!

Brent Dykes
Brent Dykes

I think this is a common problem across various business/IT projects -- and not just particular to web analytics. If a project is to "live on" after it is complete, it's frequently going to need ongoing support and additional resources.