Business owners of small to medium sized businesses (SMBs) often ask how they to increase their annual sales, and many turn to their marketing teams for suggestions. But how can company executives know for certain that the advice given to them encompasses a big picture strategy versus just a small segment?
Marketing analytics can be used to increase clarity and answer key business questions. Large corporations have already incorporated marketing analytics to further understand the vast data available to them. And because of these efforts, they now make better data-driven decisions, spend more efficiently, and grow more rapidly.
Since these big companies are already claiming bigger portions of the pie, how do small to medium sized businesses compete with the big boys?
Getting Started in Marketing Analytics
Marketing analytics is important for SMBs, but in my own experience at an agency I found that many business owners are more concerned about their next sale or how much they will grow month-over-month. When asked how SMBs should get started in marketing analytics, Tom Fuertes, Chief Operating Officer at CROmetrics puts it plainly, “start with the Google Analytics dashboard overview, then ask more questions”.
Google Analytics already provides a wealth of information useful for business owners to begin making better data-driven decisions. Reviewing metrics such as the number of sessions, bounce rates, conversion rates, and pageviews split between different marketing channels such as organic, paid, social, and referral can provide digestible content for small business owners to consume.
However, these metrics given by Google often produce little clarity and are sometimes considered meaningless by digital marketers viewed from certain perspectives.
“You can’t pay your bills with Google Analytics dashboards, but you can with actionable insights”. – Tom Fuertes
The key to business growth lies deep in the data, and being able to decipher large data sets is the only way to ensure success.
Early Pain Points
I recently spoke to a data analyst about this topic and asked what he thought about marketing analytics for SMBs.
“There’s a need for [marketing] analytics in small and medium sized businesses, but they often do not have enough data to work with. However, for SMBs that do, they often hire for data scientists first, but later learn they needed a data engineer instead, to first clean the data”. - Zach Chechavat, Data Analyst at ShipStation
Zach’s sentiment was echoed by the Senior Manager of Social Analytics at Bazaarvoice:
“Because of the complexities of comparing disparate data sources, oftentimes coding languages, such as SQL or Python, are needed to clean and prepare the data for proper analysis”. - Sandy Donlon
Cleaning data refers to the preparation of data for easier consumption by analytics and digital marketing teams alike. Using different colored marbles as an example, imagine how much easier it would be to count the number of each colored marble if these marbles were first sorted by colors.
Deriving Actionable Insights
Once clean data is available, you’re ready for deep analysis. During this process, data analysts are able to plot trends and derive insights. They can also pick up on the areas of a business that are performing well, areas that are failing, and areas for improvement.
I asked A.J. Ellis, Internet Marketing Specialist at Ace Mart Restaurant Supply, if he ever made any discoveries during his analyses, and he mentioned that there were a handful of times where “there was missing information in datasets that would [have proven] valuable and increase understanding around how to maximize profits” had the information been there. A.J. has since then been able to present his findings to his C-level executives to tackle this information gap.
I previously worked with a client in the education industry. I noticed that the majority of quality leads came in on Mondays and Tuesdays, but fell off toward the end of the week. Since I segmented the view to take into account every campaign for the prior 12 months, I knew I was looking at a good sample of the client’s annual traffic. I was then able to reallocate marketing dollars to increase during the early parts of the week and as a result, we grew leads by nearly 30% in the months following.
From a statistical standpoint, businesses that allocate funds to various marketing channels without a clear understanding of their customers may be wasting their money.
“There are certain assumptions businesses believe in to have [quantified] the impact of advertising expenditures on sales and other positive outcomes”. - Steven Gordon, Ph.D., Analytics Consultant at Sphere Quantitative Insights
In a whitepaper published earlier this year, Steven proposed the question of how online advertising agencies know if “a customer that bought a product, would not have purchased if he or she did not see an ad for that product”?
If an ad was not present, but the customer still searched online and bought the same product, then wouldn’t this be a case of marketing dollars wasted? You can read more about Steven’s thoughts around online advertisement in his whitepaper that talks about no measurement versus bad measurement.
The last piece of marketing analytics revolves around data visualization. Cleaning raw data and inferring insights would be a waste if key decision makers were not able to easily understand the implications of the findings.
There are various Business Intelligence tools used, such as Tableau, Power BI, Domo, and Apache Spark. Data analysts are able to utilize these tools to retrieve data from varying sources, chop and dice the data into minute segments, and report on their findings.
Some boutique consulting firms offer training services for a corporate organization or a classroom of students. As an example, the guys over at TableauHelp recently taught a group of digital marketing apprentices the basics of Tableau. These apprentices were able to walk away with a wealth of data visualization knowledge they could immediately apply to their full-time marketing jobs.
The need for marketing analytics is present all around us regardless of the size of the company. If there is a sufficient amount of data available for a business, it's ideal to properly analyze the data for actionable insights.
I urge SMBs to take a closer look at their marketing performance and the quality of traffic that enters into their marketing and sales funnels. Begin to ask questions around where your best leads come from and how to effectively increase your sales. Inquisition into these areas will help get your company on track to meet your business goals.
Are you looking to grow your marketing team? Read this article on finding Passionate Explorers to help revitalize your business and take it to the next level.