McKinsey Have It Wrong.

Metrics are not undermining digital marketing.  It’s the use of (or lack of) the available metrics that is undermining digital marketing.

An article in the October 08 edition of the McKinsey Quarterly (free registration to read) draws the conclusion that “poor metrics are undermining digital marketing”.

According to McKinsey, “the Web is the most measurable medium in the history of marketing. Now all that’s left is figuring out how to measure it”.

They say that the digital world has developed faster than the tools needed to measure it.   We may quibble over definitions or gripe at some of the tools and interfaces we have to work with but saying that the lack of tools are hobbling digital marketing is completely false.

We have data in abundance.  Every digital campaign provides you with detailed reports on ad impressions and clicks.   Cookies enable us to track post click activity and there is an abundance of analytical services available to monitor and report on your Web site activity, many costing little or nothing.

All this data may be easier for direct marketers to use but brand marketers running multi-channel brand campaigns should have nothing to complain about.   The abundance of quantitative data available from the online/digital portion of your campaign (numbers viewing your ads, interactions with your ads, activity on your web site etc etc) can be supplemented with online marketing effectiveness studies that measure the impact of digital marketing on your brand.

Lack of data on your digital marketing and the tools to extract this information are not where the problems lie.  If anything the problems are not with the lack of information sources and tools,  they are with the volume of information available and how to put all the disparate elements together in a way that provide insights and actionable results from your digital marketing efforts.

The information is all there but what is lacking in many cases are the people to report, interpret and provide actionable recommendations.  McKinsey surveyed 340 senior marketing executives and found that “only a minority of advertiser use quantitative analytical techniques to optimize online marketing”.  Only half of the respondents “use the basic of metrics – the CTR – to evaluate the impact of direct-response advertising”.  80% of these senior marketing execs use subjective judgements or repeat what they did last year when deciding how to allocate marketing budgets.

This is a McKinsey study so I am sure that these senior execs are SENIOR i.e big companies with big marketing budgets.    I find it hard to fathom how the authors of this article could draw the conclusion that the fault lies with the lack of tools after reviewing the results of their own survey.

The fact that these senior marketing executives were not getting quantitative decision-making information points to a breakdown in the process.

Maybe its easier to blame the lack of tools than ask the question that is at the heart of the matter – why is there a breakdown between running a digital campaign and providing a one sheet executive summary on results and actionable recommendations to move forward?

Does it lie with the senior executives who just don’t understand the digital landscape and are afraid to either ask the questions or put the right person in place to manage the digital campaigns?  Does it lie with the e-marketing executive who is in charge of overseeing all things digital for the particular brand or department?  Is it your digital agency’s fault?

Is is because each component of the digital campaign is siloed.  If a companies’ internal analytics team are holed up in the basement and never interact with the agency providing the external data on a campaign how can you ever expect anything but disjointed reports with lots of information that is useless without some context.  For example, if your agency is providing huge reports on click thru and impressions and your internal Web team are providing reports on the number of  people watching your cool new product demo but if there is no competent digital manager to put the different reports together how do you know from what campaign or Web site these people watching the demo are coming from?

With an overload of data it can be easier to throw up your hands and just stick with the old ways of doing things.  The problem is that the old ways of doing things are not going to help your organization grow or to help in a world where digital is becoming more and more integral to how you communicate with your customer.  My Ma always said a poor workman always blames his tools.  We cannot blame our digital tools.  There good and getting better all the time. The problems lie with the process and having the right people with the experience and training on hand to wrap the abundance of available data and information in to actionable results.