CMOs have long faced an identity crisis as they play many roles. In fact, Deloitte has identified five archetypal CMOs: Customer Champions, Capability Builders, Innovation Catalysts, Chief Storytellers, and Growth Drivers. Each has its own mandate. But ultimately, they are all held accountable for driving revenue. And for all of them, data is a double-edged sword that raises expectations and reveals new ways to grow.
The ambiguity around the CMO role is nothing new. There's always been a struggle between brand and bottom line. But recently the CMO's dilemma has taken on a more quantitative quality. "Math men" are replacing "Mad Men." CMOs face pressure to operate like numbers-driven CFOs. Marketing departments are hiring data scientists.
CMOs have spent heavily on new tech to handle these data concerns – and after so much investment, CEOs are demanding results. No matter which hat a CMO wears, knowing how to impact revenue is always part of the job. It's a mandate they can't escape, especially with all the data now at their disposal.
The trouble is that unless the data is tied directly to dollars, CMOs struggle to produce revenue results. And most of today's prominent analytics approaches don't connect the dots. Social media buzz and sentiment figures don't reflect revenue. Predictive analytics points to likely outcomes but doesn't reveal how to change them. Even painstakingly-crafted brand studies are a few steps removed from actual movements in sales.
Fortunately, a new approach to marketing data called "explanatory analytics" is ready to change all that.
Insights are only useful if the underlying data correlates to a KPI that matters. After all, companies can't pay shareholders dividends in clicks and likes, nor can they fund promotions and bonuses for their employees with high NPS scores. And, as it turns out, only about 15% - 20% of all social data is in any way correlated with most brands' financial performance. So the first trick is to find that 20% that matters, and work with that data to discover what's going on, explain why, and then make a better decision. And that's what explanatory analytics is all about.
In its new white paper, "How Explanatory Analytics Enables Leadership," Quantifind examines Deloitte's popular "Multiple Roles of the 21st Century CMO" model and how explanatory analytics unleashes the full potential of each CMO type. Here's a preview of how each type benefits from this new approach to data and, in some cases, helps CMOs set their own leadership agenda and become the kind of marketing leader they most want to be.
The Customer Champion
You focus on the voice of the customer and run your organization with customer centrality in mind. But if your job is to speak for the masses, you'd better use data to understand what they're saying— and how it relates to revenue. That's how you convince your C-suite peers to make the changes customers value most.
The Capability Builder
You empower your organization by investing in resources, securing access to new data sources and building tech fluency within your teams. But when CMOs invest in new capabilities, CEOs expect to see a clear return. For the Capability Builder, explanatory analytics helps them understand and advocate the business case for new capabilities ahead of time, and not just measure the ROI after the fact.
The Innovation Catalyst
You want to transform the customer experience and experiment with new technologies. But CEOs and CFOs need to know that big bets are going to pay off, and not everybody has the same appetite for technology risks. With an explanatory methodology, you can use data to take a purpose-driven approach to innovation, mitigate your risk, and zero in on the innovations most likely to drive growth. What's more, you can quantify your upside.
The Chief Storyteller
You find ways to engage customers with compelling stories across multiple channels. But the Chief Storyteller must understand the business impact of what they're creating ahead of time. After all, their work is going to be judged by the numbers after the fact. But with explanatory analytics, Chief Storytellers can identify the story components most likely to inspire spending and inform their narrative with numbers ahead of time.
You focus on sustainable and profitable growth. By definition, this makes you someone who cares about data— but increasingly, your challenge isn't understanding what's happening, but why it's happening and how to change it. Ask yourself: would you rather walks into a board meeting with good results but not be able to explain what worked or why? Or would you rather go in with mixed results and know exactly what's happening, why and how to fix it? Explanatory analytics help Growth Drivers rock that meeting.
There's no longer any question that data analytics and marketing leadership now go hand-in-hand. The only question is, how will marketing leaders engage? Will data inspire, inform and improve their marketing strategies? Or will data simply be used to pass judgment on their performance after it's too late? A more explanatory approach to data analytics – one that lets them explore, understand and change their impact on revenue ahead of time – is the best way for marketing leaders to finally gain the upper hand in shaping their own fates in a digital future.
About the Author
Joshua Reynolds heads client consulting for Quantifind, where he consults with senior executives from Fortune 100 brands across multiple verticals.
A former Gartner analyst, Josh focuses on using data to architect behavior-changing campaigns. He was named a Holmes Report Top 25 Innovator in 2014 for his work in storytelling and served as CEO of Blanc & Otus, a tech-marketing consultancy. He's also a frequent speaker and author on innovative marketing strategies and human-in-the-loop computing.
About the Company
Quantifind helps brands explore, understand and change their impact on revenue. Our on-demand insights platform, Signum, uses explanatory analytics to inform important marketing decisions around campaigns, sponsorships, creative direction, product and brand strategies. Quantifind's clients are some of the worlds most well-known brands spanning industries including beverage, consumer packaged goods, financial services, movie studios, telcom and restaurants.