Marketing Dashboards: Metrics That Matter
Bi-monthly columns from the Atlanta Business Chronicle
It seems like every article about marketing these days is focused on Big Data or marketing metrics. All of them describe the need for marketers to take more advantage of the increasing amounts of data available. I argued in one of my columns last year that what is needed is not more data, but more insights.
One trend responding to the need for converting data into insights is the increasing use of marketing dashboards. If you Google “marketing dashboards” you will get 25,000 results (without the quote marks, you will get 200,000 results). Dashboards are one answer to the C-suite’s increasing demands for measurement and accountability for marketing.
Pat LaPointe, author of Marketing by the Dashboard Light, defines a dashboard as “a collection of what are believed to be the most critical diagnostic and predictive metrics, organized in a way to promote the recognition of patterns of performance.” In other words, just like the dashboard on an automobile or an airplane, a dashboard provides the driver, pilot, or manager with the information needed to make the critical decisions they must make.
Dashboards have been used in manufacturing plants for many years to determine how well the plants are running. Marketing dashboards came into being in the mid-1990s following the publication of The Balanced Scorecard by Robert Kaplan and David Norton. The concept of a balanced scorecard called for a holistic view of a company’s performance that incorporated internal financial data and external data like customer satisfaction.
The marketing dashboard trend accelerated in the last decade following the explosion of data, the rise in digital marketing, and the introduction of the Net Promoter Score — the difference between the percentage of your customers who recommend your brand (“promoters”) minus the percentage who will not (“detractors”).
Dashboards were brought to my mind recently when I participated in an Atlanta Chapter of the American Marketing Association Executive Advisory Board roundtable discussion on dashboards for marketing. Liz Ward, the current president of the chapter and founder of Thought Partners, an Atlanta-based consulting firm, has authored an AMA White Paper based on the roundtable discussion, What Gets Measured Gets…?.
Download a copy of the report
As companies today collect far more data than they can ever act on, the challenge is to identify which data merits attention and drives decisions. The AMA White Paper describes how Atlanta companies, including Coca-Cola, Georgia Pacific, Cox Communications, Chick-fil-A, and smaller organizations like Dragon Army and Atlanta Convention & Visitors Bureau, design and use dashboards to monitor marketing performance and make marketing decisions.
The members of the AMA Executive Advisory Board identified a number of key issues in creating and using dashboards. It is clear that there is no single way to design and use a dashboard. As described in the report, dashboards “seem like snowflakes – no two are alike.”
Some companies have a single dashboard and others have multiple ones. Often there is one overall one for marketing and then different departments have their own, more granular ones, based on their span of control and objectives. There typically is a mix of internal and external data including those metrics tied to a company’s objectives, competitive situation, and ratings by its customers. Some are backward-looking and some are predictive or forward-looking.
The questions a dashboard should answer are: How are we doing? Are we making progress? Are we meeting our goals? There is agreement that the purpose is to create focus on the metrics that matter. For example, at Coca-Cola customer sentiment is important; it is “an indication of things to come.”
There are a number of challenges to create effective dashboards. The technology is often a problem with data residing in multiple databases and problems with legacy systems. With the rise of digital marketing, there is an explosion of data and some organizations have a dearth of data analysts who can turn data into insights and action. Another challenge is that the dashboard often yields insights into what’s happening but not why.
The question regarding who in the company manages and controls data and the dashboards is a strategic one. The credibility of the dashboard is critical, which is why many companies have the data managed by an independent business analysis function that often reports into the CFO.
Among the suggestions in the white paper are: a) pick a few metrics (typically 5-7) that are connected to your highest impact recurring decisions, b) validate the connections between the dashboard and sales, c) make it accessible everywhere including mobile, and d) make it “Apple-simple.”
As the white paper concludes, when dashboards work well, there is “shared vision of the ‘truth,’ wide usage within the company, real-time actionability, and 80 percent fewer reports — is this dashboard nirvana?”
Ken Bernhardt is Regents Professor of Marketing Emeritus at Georgia State University’s Robinson College of Business and a marketing consultant. He can be reached at firstname.lastname@example.org.