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Wednesday, Jun. 24, 2009 at 10:55 am

Beware Marketing Automation Without Data Clarification

By Bryan Eisenberg
June 24th, 2009

We marketers are very busy people. In today’s challenging economy, with its rapid digital pace and customers empowered like never before, the demands are never-ending. So, we love things that make our job easier. Or at least appear to.

The Words ‘Marketing Automation’ are Like Music To Our Ears

According to one definition:

Marketing automation is the use of software to automate marketing processes such as customer segmentation, customer data integration (CDI), and campaign management. The use of marketing automation makes processes that would otherwise have been performed manually much more efficient, and makes some new processes possible.

In plain English, marketing automation uses data (like your web analytics) to do some of your marketing tasks for you. Herein lies the problem I keep running into: Your decisions and those of your marketing automation platform are only as sound as your data.

I’ve seen marketing automation software that helps your email marketing, your ppc bid management, segmentation and personalization, and others. As Jeff Sexton recently pointed out, if you have the wrong analytics it could cost you 30% of your sales. Can you afford that today?

A few weeks ago we were helping a client optimize her website and we wanted access to her historical data. All she had was the analytics from her marketing automation vendor. Now the fact that you could only access these analytics using Internet Explorer (we are mostly on Macs) was one failure, but the main failure was that it looks like the analytics was an after-thought by the vendor. Anyone can throw up some reports on a screen — but the issue is, do they tell you anything meaningful? There was virtually nothing to make you smarter as a marketer. Today’s smart marketers understand the value of data-driven decisions. Unfortunately, this vendor’s reports provided in an abstract way what happened but did not provide the vital statistics to diagnosis and prescribe any sort of optimization to the company’s efforts.

Marketing Automation Must Make You Smarter Not Lazier

I was talking to friend who is a superstar B2B marketer. He was telling me about this new enterprise PPC bid management software he was evaluating. He deals with thousands and thousands of terms so automating the bidding would be a huge help. He told me about the slick interface and the bidding rules, etc. Then I asked him the question that made him stop like a deer in the headlights.

“Have you checked out the data reporting behind the algorithm? What actionable insights does your ppc automation vendor provide you?”

Of course, vendors will shout “proprietary formula” and we marketers fall for this marketing B.S. We don’t need the complex details behind it but we do need to get a sense of what and how they look at data, keyword attribution, etc. What metrics do they value most? If you fall for the “black box” how do you and the system continue to learn? How do remove it if you are unhappy with the vendor? How do you create your internal best practices unless you have a clear picture into what is happening?

Without good data at the core, you may just end up with a mechanical turk. You need data to share in your organization and data that tells you details of what you’re doing and how to improve it. Also, beware of bad software that takes what you need done and tries to completely automate it. Just because it is automated won’t guarantee it is optimal for the way a good marketer works.

Don’t Forget Your Job Is to Make More Money, Not to Make Your Job Easier

The point of marketing automation is to free you up to do more of what you are really good at by letting the glorified calculator do what it is really good at. Good marketing automation lets you use your insights about your customers in ways you couldn’t before; bad software takes those decisions away and prays that the computer will do it for you. Keep in mind we have created a computer that has barely beaten a great human chess player, despite its intricate and complex algorithm –  and we’re still far off from a computer to beat the best human poker players. Do you really believe that some algorithm is going to be better than you at creative marketing insights?

Without solid data, scientific method and reporting, how does your marketing automation software show you it is making money? Whether or not you are using marketing automation, you still need access to great metrics. In the case of marketing personalization, how do you know if the efforts are working if there aren’t control groups to measure against? How do you control for other external factors?

The Marketing Automation Future, Now

Don’t get me wrong — I am an advocate for marketing automation. But only if there is a core focus on the insight derived from data, not the automation, first. Analytics must be at the foundation and not an afterthought. You can identify first generation automation tools by their focus in on automation first and reports second. Today’s next-generation state-of-the-art tools have to have great metrics and analysis at their core and are focused on helping you optimize your business; that is, making you more money and proving their value to you.

Please feel free to tell me more about your marketing automation love fest or worries.

P.S. Full disclosure: like my good friend and analytics evangelist Avinash Kaushik, I work for and sit on several advisory boards of companies that use data as their foundation for marketing optimization and automation.

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Comments (14)

  1. Hey Bryan,

    Great points, all. I’d underscore your point that the analytics foundation has to be solid before you start your optimization journey.

    From there, I think we need visibility and guidance. Where are the areas of opportunity and potential loss? Where should I start?

    We need a clear view and information, not just a data dump. One of my college professors once said “Data + Insight = Information” and that’s more true of online marketing than ever.

    Automation is one part of the marketing arsenal. But, as you’ve shown with OnTarget, prioritization is just as important. Without great data, you can’t prioritize correctly.

    Cheers,
    -Alex
    Marketing Manager, ClickEquations

    PS: Full disclosure, Bryan is on our board and I’m a committed fan :-)

  2. Great post. I see many people (including myself in past years) rely on the heavy use of automation to the point where it is almost like a drug. Looking for the fastest way to accomplish vital marketing tasks leads to pure laziness for a lot folks.

  3. I am reminded of the time 10 years back when a client wanted to test personalized emails so they asked for email, First and Last Name at signup. One reader obviously felt this was no business of the client in question. The subsequent personalized email campaign addressed to “Dear F*** You” highlights the need to check that both the data and processes you have in place are accurate!

  4. In CRM circles, I called this “automating worst practices”.

    It’s so easy to take a faulty Marketing framework and make it run faster, without ever addressing the root cause of the problems.

    With the result you spend a lot of money for a system that bankrupts you even faster.

    What a world.

  5. I had similar thoughts as Jim. Since CRM has been around much longer than marketing automation, they have gone through the “bleeding edge.” One of the biggest problems is dirty data. Most firms I worked at outsourced data cleansing once a year or every other year. Not an inexpensive option but always seems to have been worth it.

  6. I really like your wrap-up to the post, stressing insight not just data. To me, I am able to use marketing automation to save time with email campaigns, lead nurturing, and lead scoring so that I can spend time analyzing the results of these campaigns. This ‘extra’ time is what allows me to improve my return and make Marketo (the marketing automation tool I use) worth the cost. The added benefit is built in tools that allow for testing campaigns (A/B testing for email and landing pages) so that I can do my web analysis, email analysis, and campaign analysis all in one system.

    Regarding the analytics problem for the customer above, I think that regardless of what marketing automation tool you use you should always use a 2nd (or backup) web analytics tool like Omniture or Google Analytics to ensure that you aren’t missing any data.

  7. [...] Beware Marketing Automation Without Data Clarification [...]

  8. Great post, Bryan.

    I like to make an analogy with a construction site. All kinds of machines to help with productivity from a tower crane down to an electric drill.

    But it’s human beings that are in control making it all happen. It’s their skill and motivation that makes the job work – not the quality of the machinery.

  9. Great points, Bryan. I would also point out that not all data is not created equal. Bad data can have very bad effects on any automation tool, and as you and other have pointed out, it takes people who proper understanding of numbers and analytics to ensure the data is as accurate as possible.

  10. Excellent point
    however,i wanna say bad data will misunderstand people and have terrible effect on automation tool.

  11. Well said sir, I feel that automation is key for marketing, but in order to do so effectively you need to target your demographic and have your numbers/testing down in order to minimize loss.

    Nonetheless, great post, keep up the good work!

  12. Thanks for this! Great stuff.

  13. I am inspired. I enjoy nothing more than discussing broad concepts and improvements for better business modeling. Fantastic site. I too accept and agree with your key points.
    Analytical must be the foundation or framework if that is what you are trying to achieve with your software package.

    The system is to be designed to make you smarter not lazier.

    I would suggest that any marketing system that is designed to optimize and capture the organization’s performance should be a complex yet simple GAP ANALYSIS.

    This method can include a range of parameters that vary with the specific target range. The data input may include every aspect of the organization and then be used for various purposes and methodology. i.e end to end system that identifies strengths, performance, weakness and business areas to improve on or optimize.

  14. One reader obviously felt this was no business of the client in question.

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Bryan Eisenberg, founder of FutureNow, is a professional marketing speaker and the co-author of New York Times and Wall Street Journal bestselling books Call to Action and Waiting For Your Cat to Bark and Always Be Testing. You can friend him on Facebook or Twitter.

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