Inbound marketing is swiftly changing the way organizations compete. When potential customers seek data, connect with you via web-based networking media, and get to your site content, they leave an abundant trail of information. Companies capture all this information to understand their customers better, and design products (and market them), so they are in sync with this obtained information.
However, the process doesn’t end there. Companies also look at integrating their sales and marketing verticals so that a more closed-loop approach to marketing analytics can be achieved.
While you are browsing an e-commerce site, are you amazed by the ‘pro-active’ display of relevant products? How does a site predict and act upon your preference? Well, it is all due to business analysis that helps the site to understand patterns of what happened in the past (your past search preference) to predict what might happen in the future (what you may presently be interested in).
With the explosion of leads and the availability of customer data right at the marketers’ fingertips, it is quite natural that marketing analytics is now an indispensable part of business analytics.
Before we get into why this is important, it’s ‘important’ to understand the difference between analytics and analysis. According to Merriam-Webster dictionary, an analysis is the separation of a whole into its parts, and analytics is the method of logical analysis. Marketers leverage both to drive all kinds of decisions, and each application supports the unique insight and challenges inherent in dissecting customer behaviors.
One way to distinguish between analysis and analytics is to think regarding the past and the future. ‘Analysis’ looks backward over time, providing marketers with a historical view of what happened in the past. On the contrary, analytics looks forward to modeling the future or predict a result. Irrespective of nature, both are equally important to marketers; besides providing great value while they (marketers) create an image of their customers, they also help evaluate the success of the marketing efforts. To be able to identify the precise audience and marketing message, analysis and analytics both play significant roles. They help in making better business decisions and gauging the performance of marketing tools.
Marketing continues to shift from regular outbound, offline marketing activities to online, inbound marketing techniques. We have long known that the power of digital marketing is in its measurability. However, these days, one can easily measure every aspect of their marketing efforts, not only from a campaign view but on lead-by-lead basis using the various available marketing tools.
Nonetheless, measurement is only half the story we hear – the other half being attribution-understanding – how to allocate credit to various marketing activities and rightly perceive their effect on the client venture.
Business analytics is critical for remaining competitive in business and achieving success. It is used to measure everything – be it warehouse efficiency, manufacturing information, sales pipeline, or revenue contribution from marketing. What you measure and how you gather information is a case-by-case decision; nonetheless, the objective of business analytics remains the same.
The above image depicts the entire journey of business analytics.
Business analytics typically combines data from each department to gain an understanding of how the organization is functioning as a whole. Today, as most business capacities have moved online, it is much easier to access and analyze information from each department. And where better can you view this but the marketing department?
Though it may appear simple and without any hiccups, business analytics, on the contrary, doesn’t come without its share of challenges. As has been rightly described by John Jordan from the Penn State University, some of the challenges of business analytics include “…a greater potential for privacy invasion, greater financial exposure in fast-moving markets, greater potential for mistaking noise for true insight, and a higher risk of spending lots of money and time chasing poorly defined problems or opportunities…”.
Just as the name suggests, marketing analytics focuses on market feedback. It keeps track of activities and interests of subscribers, leads, and customers, and helps marketers to optimize their campaigns by analyzing marketing performance. Rather than resting the onus of marketing analytics with just a select few, it should be used by every marketer in the team for better results. This can help them to evaluate the efforts and optimize the same. Further, it can empower one to make decisions backed by data and identify the future course of action. After all, a digital marketer’s job is not just about getting more clicks or driving more traffic to a website – it is to drive revenue growth as well.
Not quantifying the results of your marketing efforts will make it difficult for you to recognize the impact they have had on closing leads. Also, this can hamper the analysis of your lead nurture programs.
Most marketers consider their website and social media analytics as their starting line. While website analytics measure actions such as clicks, page views, and conversions; social media analytics offer you the right insight of your digital media outreach – across the social media platforms.
Marketing analytics goes beyond strictly measuring just the online performance – it also encompasses a way to deal with the offline marketing efforts as well. By bringing together all areas of marketing, including offline efforts with sales and lead generation results, marketing analytics shows the direct impact marketing has on pipeline generation and revenue growth.
As a comparison, business analytics provide insights that help inform business decisions and can be used to automate and optimize business processes. For data-driven companies, all captured data are in fact assets for them that influence the decision-making process within the organization. Naturally, the quality of the captured data is important and plays a decisive role in taking decisions.
The benefits of marketing analytics aren’t limited to just the marketing department. They hold value for verticals such as sales, customer service, and senior business management, among others. This is due to the timely market feedback that they offer, which in turn helps professionals in the respective verticals to maximize their investments and priorities.
Business analytics, on the other hand, prepares you to deal with real problems within business operations using advanced analytical methods such as optimization, simulation, forecasting, and statistics. While marketing analytics is ideal for working on marketing issues; business analytics helps in the decision-making process within organizations.
In the end, marketing and business analytics create the two sides of a coin – without marketing data, business analytics wouldn't tell the entire story and vice versa. Marketing analytics rely on business data from other departments, primarily sales, to provide feedback about the downstream impact of marketing efforts.