Companies that harness creativity and data in tandem have growth rates twice as high as companies that don’t.
I was having lunch with a prospective client recently and she asked me “Who is your biggest competitor?” With 27 years in this business, I’ve answered that a lot of different ways depending on the industry, client and circumstances at the time. As an ad veteran and agency owner for nearly 50% of those 27 years I was somewhat surprised (as she was) at my answer. “You are,” I said and will explain my reason for that answer as I did to her.
Over the last three years, our agency has focused and found great success in the travel and tourism space. We first started in tourism in 1997, working with Disney Vacation Club to help them use their customer data to identify good prospects for new timeshare resorts they were building through the Southeast. Our experience in the financial services industry allowed us to export our data-driven approach to mining demographic data to identify the best responders for direct mail campaigns soliciting owners for those new properties. We enjoyed tremendous success and it allowed us to then add Hilton, Marriott and Hard Rock as clients. Since then, we’ve expanded tourism to include independent resorts, DMOs (destinations marketing organizations), CVBs (convention and visitor bureaus) and state/regional tourism offices. Travel and tourism is an industry loaded with incredibly rich data and the explosion of marketing channels and proliferation of social and psychographic data has afforded us tremendous insight in to the customer journey and behavior.
So back to my lunch and my “you are” answer. Despite all this rich and abundant data, I’m amazed at the reluctance of marketers to take advantage of this information and instead continue to do what they have always done. “You are” comes from seeing so many clients opt to either adopt last years marketing plan with a 10% increase in budget or to tell me they don’t have the staff to take on more or their agency is providing all their analytics. While I certainly can understand the staffing and resource issue, I find those reasons to no longer be satisfactory as rationale for not embracing and understanding the value their data represents to the organization and to growth.
McKinsey recently surveyed more than 200 CMOs and senior marketing executives (including interviews with 25+ of the CMOs) and tracked the performance of their companies. They found that marketers who are what they call “integrators”—those who have united data and creativity—grow their revenues at twice the average rate of S&P 500 companies: at least 10 percent annually versus 5 percent.
I have been either an owner or Executive Manager at general agencies for 17 years of my career. I have great respect for general agency work. Brand building and awareness are incredibly important components in driving growth and I do not denigrate their importance in the marketing mix. We work closely with many national and regional agencies in our client engagements and enjoy a wonderfully collaborative and mutually rewarding relationship. That said, general agencies are not data driven and do not approach customer analysis and household advertising quite the same.
Most companies can track the impact of specific marketing components in direct-response channels such as email and search-engine marketing but struggle to holistically measure channels (both online and offline) and attribute the success of a campaign to individual creative, content, and messages. Addressing this challenge requires a “mash-up” of existing technologies and approaches like media-mix modeling, which tracks both online and offline marketing channels and multi-touch attribution, which allows companies to track the addressable touchpoints across a customer’s journey. At the moment, very few companies are doing any of this. At RMG, we’re proud to say we are at the forefront of developing capabilities to integrate traditional general advertising (above the line) with addressable household level advertising (below the line) to ascribe response attribution and campaign measurement across all media.
As I told my prospective client, you’ve hired a creative agency to “own” your brand and build your awareness. Not it’s time to make that same commitment to a data-driven marketing partner that can help leverage the investment you’ve made in acquiring customer data and insights.
One CMO in our survey said, “You don’t create exciting things for people by figuring out things from data.” Actually, we believe that’s exactly what data can do. At the end of the day, analytics are what companies have learned about people’s behavior. Such insights can guide and inform where imagination needs to go. In the best cases, they can even inspire. Marketers that are leading the pack in driving growth understand that data and human ingenuity are two sides of the same coin.