We’re now in a new age of evidence-based decision-making
Opinion
There is a risk of paralysis amongst consumers when it comes to choosing products or services. The same could be said for advertisers and media owners when analysing data.
According to a recent report published by WARC, nearly two-thirds (65%) of marketing leaders claim they are sometimes forced to make business-critical decisions without adequate data. Meanwhile, just under four in ten (39%) say that, even with the data they need, they don’t feel confident interpreting and using it to make informed decisions.
So is evidence based decision making getting harder, as these statistics would seem to indicate? And if it is, why might that be? What can insight practitioners and businesses do to make things easier for clients?
It’s certainly true that businesses are dealing with more data than ever before. The digitisation of every area of our lives continues apace. The resulting proliferation of data could make some business leaders feel they haven’t got enough data, whilst the ones that have vast amounts may suffer from confusion.
Behavioural science tells us that more doesn’t necessarily equate to better or easier decisions. The phenomena of choice paralysis amongst consumers is examined by Richard Shotton (author of The Choice Factory) as he references a meta analysis by Alexander Chernev of 53 experiments.
This paper finds choice paralysis occurs when people are unfamiliar with the options, the options seem similar with no clear winner, and the options are difficult to evaluate.
It’s easy to see that this paralysis amongst consumers, when choosing products or services, could easily apply in the business context when analysing data.
This apparent contradiction in more data but less confidence is potentially a rising phenomenon and an important challenge. More interestingly, what are insight and data businesses doing about it?
To help tackle this question, I asked a diverse range of people in my network what they had to say about it.
Making existing data work harder
My own observation is that the research landscape has changed dramatically over the last few years. We have seen a new breed of agency that works with existing data emerging. This started with a glut of social media analysis firms but now these agencies work with all types of data.
Take Relative Insight, for example: it provides a platform that extracts value from all types of text based data, including social media, reviews, websites, jobs boards, emails, employee surveys and CRM data. It defines itself as a tech company rather than a research agency, focusing on the smart software solution first and the actionable analysis second.
Increasing automation
Another big trend has been the automation of insights – again something that is platform-led. In February this year Zappi, which is at the forefront of this trend, announced it has reached a critical milestone of $50m in sales in 2021, representing more than 30% growth over the previous year.
The purpose of these types of businesses is to democratise research and put the potential of insight in the hands of non insight practitioners through the power of automation. Zappi describes itself as the agile platform designed for creators.
Systems integration
If you look at the emergence and transformation of eye-tracking companies, another interesting development is the integration of insight and data into other systems.
For example, in the case of Lumen Research, its offer now extends to media buying. According to Mike Follett, owner and MD of Lumen: “Integrating information sources can multiply the power of each one. The attention data that we produce is interesting in itself, but not half as interesting as when it’s combined with cost or outcomes data. That’s when the magic happens.”
New types of talent
All of the above means that we are witnessing a diversification in the types of talent that research businesses rely on.
A quick look at the LinkedIn pages of Catalyx, Lifestream, Street Bees and Lumen show that these businesses are employing software engineers, chief technical officers, front end developers and machine learning leads.
Democratisation of data
On top of that, it’s no longer the case that data is the sole responsibility of the insight team.
According to Helen Rose, managing partner and head of insight and analytics at media agency the7stars, “data is everyone’s responsibility these days – whether it’s customer data, media metrics or brand health statistics – data touchpoints live throughout the planning, buying and evaluation process.”
With platforms making data more readily available via automation, this is increasingly feasible.
Insight at the forefront of big strategic issues
It’s also encouraging to see that data is being used to tackle really important issues. I absolutely love how Grace Kite of Magic Numbers is showcasing advertising emissions data.
This only goes to show that our industry can make a genuine difference, playing our part in addressing climate change. If this type of analysis doesn’t make you feel more confident about making evidence based decisions, I don’t know what will.
Communication is key
I’ve talked a lot about tech, but this only makes the human side of things more important. There is an even bigger job for insight practitioners to translate all these insights into easily digestible and practical implications for clients.
This is not easy. The job of creating simple and actionable recommendations remains one of the most challenging elements of research.
A challenge that is recognised by Shazia Ginai, CEO at Neuro-Insight, who says: “The human brain is wired to pay real attention to stories, this has been proven many times over across the 11 years of data gathering at Neuro-Insight. This doesn’t only apply to the advertising we create for consumers, but also to the way in which agencies communicate to their client partners.”
As data gets more ubiquitous, decision making becomes more complex, so marketers need experts who can connect the dots between data and commercial opportunity.
I love that I am part of an established industry full of brilliant people who know how to ask pertinent questions, spot useful data and translate it into insight to articulate a fresh perspective that will unlock innovation, value and ROI.
It feels like a great time to be an insight practitioner.
Anna Sampson is the founder of Anna Sampson Consulting and was previously insight and strategy director at Magnetic
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