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How to stop trusting your gut and build a data-first culture

By Tim Banks | Head of user experience

Reading Room


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November 15, 2021 | 6 min read

Data is by now so ubiquitous in marketing that it can be tempting to overestimate its importance in our decision-making – the evidence shows that we still mainly rely on gut feel for big decisions. For our Deep Dive on Data, Tim Banks of The Drum Network member Reading Room delves into how to replace gut feel with a data-first culture.

Every interaction in the digital world generates data. This makes it almost irresistible for marketers to rely heavily on the platforms that track these interactions to justify decisions, drive strategy and measure success.

A signpost at a crossroads

Reading Room’s Tim Banks on how to create a culture of data-based decision making

But despite all the talk about big data, is it really helping to improve the decisions we make?

It’s certainly true that data is important. Being able to measure outcomes and make informed decisions is crucial to improving marketing performance. Used well, data gives you baselines to measure progress against; tests assumptions about your customers; and reveals business challenges you didn’t even know you had.

But, according to Forbes, firms make fewer than 50% of their decisions based on quantitative information as opposed to gut feeling, experience or opinion, even though 85% of businesses want to improve their use of data insights in decision making.

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Why do many of us still fall back on our gut?

The complexity and pace of decision making under uncertainty makes it difficult to understand what data to focus on and how it should be interpreted. When presented with the seemingly limitless (and often free) expanse of third-party data, it can be tempting to just make your decision fit with the data you have to hand, or worse – use data out of context to justify gut decisions you’ve already made.

As the work of Daniel Kahneman and other behavioral scientists has revealed, this constant state of uncertainty is why we have evolved to make most of our decisions intuitively using the unconscious ‘system 1’ part of our brain.

While intuition worked well for our cave-dwelling ancestors, when it comes to making strategic business decisions, it can be a fatal mistake.

Data-first culture

We see many businesses struggle to learn from the data they collect, understand its value and adapt marketing efforts accordingly. They simply do not have the data skills or culture. In fact, when polled, organizations consistently say that the most challenging aspect of digital transformation is responding to new data to make changes.

It’s only when interpreted through the right lens that data means anything. You must think objectively about what data and insight will enable you to make your decisions effectively. What data you need to collect is going to be dependent on your organization’s level of digital maturity, business and marketing goals, and the unique challenges you face.

Often the insights you need are best gathered using a combination of big data sources and first-party methods, such as user research. Aim for a bird’s-eye view of your market, but then validate, build out context and test prototypes by engaging directly with your customers and your service users. Making a comprehensive set of data available, linked to strategic goals and business outcomes, then becomes a baseline for decision making.

Developing detailed insights requires ongoing investment in skills, people and technology, alongside a willingness to engage your customers directly in the process. The rewards will be far-reaching.

Embrace evolution

With the future of third-party data in question, it’s easy to see why many businesses are concerned. But for those willing to embrace methods of direct engagement, this is a golden opportunity to change your relationship to data and improve the accuracy of your marketing decisions.

Actively inviting your customers to be a part of the process, asking for and receiving feedback continuously, is a more effective way to improve marketing performance, products and services compared with reliance on third-party data alone.

The tools are out there for you to embed this process of continual feedback cost-effectively. This means you can deliver marketing and services designed around the needs of your customers and be explicit with them about how their data is being used. You can feel safe in the knowledge that you have invited them to participate in the process, rather than worrying about the quality and credibility of the data being supplied by third parties.

For those brave enough to become data-first, there’s no reason to fear a cookie-less future. The right data, gathered transparently, can be relied upon to make decisions in a way that intuition simply can’t.

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