What it Means to Be a Marketer in the Insight Economy
There are innumerable formulas for success in today’s business world, but data mastery is the common denominator.
Data is currency. It is the price many consumers pay to access content and services in today’s digital economy, or, as Shapiro + Raj CEO and Chairman Zain Raj calls it, the insight economy. In his forthcoming book Marketing for Tomorrow, Not Yesterday, Raj explores the ways marketers can thrive in this new paradigm. In this Q&A, he explains the concept of the insight economy, how it changes the business of marketing and the role of the CMO, and how marketers can execute on the trough of data at their fingertips.
Define the “insight economy.”
Over the past two decades we’ve gotten into a world where—because of technology and computers have become so inexpensive—we have the ability to run through billions of terabytes of data, on an ongoing basis, to get whatever kind of fact that people would call an insight. What we’ve ended up getting into is a world driven by bits and bytes. [Marketers] have been focused on driving analytics around RFM, the traditional techniques they use. I asked 17 CMOs who they’re serving, and only one of them could tell me who their customer is as a human being. The other 16 talked about deciles, and transactional value, and the profit value of their customers.
At the end of the day, we in the business of marketing are only here to fulfill the needs of real people. To do that, we need to understand them at the deepest level. Given today’s level of commoditization, and our focus on the tactical short term value of anything we do, getting to powerful insights that can drive huge ideas is a critical imperative of the business. This is the insight economy. You have to find a way to understand your core customers as people, and you’ve got to be able to understand the dissonance between what they do and what they say, and you have to do that through deep insights.
What role do technologies and tactics such as mobile, the Internet of Things, and social media play in this new paradigm?
We all, as a business community, have gotten excited about new things. A while ago it was the Internet; then it became the availability of data. If you remember, there was a period two or three years ago when we were all fascinated with big data. In one year I met with 189 companies that were in the business of big data. Out of them, almost 160 of them went out of business. The trend around big data died naturally. But that doesn’t mean big data isn’t important, or that the Internet of Things, or anything else isn’t important.
The point I’m making is to not get caught up in these shiny new objects. Each of these technologies will only be as effective as the value it creates. Instead of just jumping on the latest bandwagon, ask yourself what this tech can do to solve your customers’ problems in a meaningful way. There are so many people chasing these new objects, and they’re missing an opportunity to make something truly material and meaningful.
I’m assuming the CMO would be the one to call these shots. Can you talk about how the role of the CMO has evolved?
If you go back 10 years, that was around the time that the CMO’s tenure dropped to its lowest levels in decades. CMOs were only keeping their jobs for about 14 months. During this time, you had CMOs who basically had one of two skills: either they knew how to build brands, or they were response-driven and knew how to bring transactions. Today, CMOs who want to be effective and successful need to become decathletes. In addition to knowing how to create communication to drive responses, they need to understand digital. They need to understand data, what’s happening in the social ecosystem, how to create holistic experiences that drive deep engagement. Being the CMO is no longer about making ads to build brands or drive traffic, the CMO needs to be a strategic partner. Today’s fast-moving, changing world is the one that requires people who have these skills. CMOs need to own the experience.