Are biases still holding back marketing analytics?
Gartner predicts that by 2023, 60 percent of CMOs will slash the size of their marketing analytics department in half because of “failed promised improvements.” The “root” cause of the shortfall was found to be cognitive biases and an old-school culture.
A Gartner survey of 377 users of marketing analytics in decision making found one-third cherry-pick data to try to tell a story that aligns with their preconceived decision or opinion.
In addition, roughly a quarter said decision makers do not review the information provided by the marketing analytics team (26 percent), reject their recommendations (24 percent) or rely on gut instincts to ultimately make their choice (24 percent).
Overall, marketing analytics was found to be only responsible for influencing 53 percent of marketing decisions.
Longstanding data management challenges – including “data are inconsistent across sources” and “data are difficult to access” – were listed as the top reason analytics are not used when making decisions.
However, Gartner noted that marketing organizations regularly respond to these challenges by integrating more data or acquiring different technology seen as a “fix-all approach” to data integration — yet diminishing marginal returns are often found when pursuing a 360-degree view of the customer.
“CMOs often believe that achieving marketing data integration goals will lead to greater influence and increased value of marketing analytics,” said Joseph Enever, Sr. Director Analyst in the Gartner Marketing practice, in a statement. “The reality is that better data won’t increase marketing analytics’ decision influence alone. CMOs must address the real challenges — cognitive biases and the need for a data-informed culture.”
Organizational silos, data quality and subpar training are also often cited as the reasons for data-driven marketing underperformance.
NewVantage Partners‘ tenth annual “Data and AI Leadership Executive Survey” also found continued slow progress being made in organizations becoming data-driven. Only 26.5 percent of respondents have a data-driven organization and 19.3 percent, a data culture.
Suggestions to better establish a data culture include:
- Hiring data and AI executives with experience in organizational change.
- Engaging change management experts to overcome barriers to data-driven cultures.
- Celebrating data successes across the organization.
- Gartner Survey Reveals Marketing Analytics are Only Influencing 53 percent of Decisions – Gartner
- Better Data Won’t Increase Marketing Analytics’ Decision Influence, but CMOs Can.” (subscription required) – Gartner
- NewVantage Partners Releases 2022 Data And AI Executive Survey – NewVantage Partners
- New Domo Study Shows the Data Decision Gap is Holding Business Back – Domo
- 2022 Global data management research – Experian
- What are the hurdles to becoming data-driven? – RetailWire
DISCUSSION QUESTIONS: Do you agree that “cognitive biases and the need for a data-informed culture” are still holding back the potential of data-driven marketing? Do you agree that marketing analytics investments will or should be scaled back due to continued shortfalls?