As we look back on the client projects we worked on through 2021, one thing that stands out as a common theme across many of them is that the client already had more than enough data or research or information of various sorts to make good strategic decisions. Yet, somehow, they were usually in one of two modes – either looking for even more data and research to justify decisions or making decisions without considering any of the information they already had at hand.
In this post I’ll try and lay out why this happens and how to avoid it (apart from the obvious solution of hiring us to solve the problem, of course!)
First, some quick examples from the clients we worked on:
- An online subscription platform where everyone in marketing was obsessed with growing the user base until we figured out that their main issue was the hemorrhaging of heavy users every year
- A retail client with almost 30 people in the marketing department, an annual research budget well in excess of 2 million RMB and tons of research that hadn’t got a clear brand architecture in place and did every campaign starting from first principles instead of building on what they knew
- A retail F&B chain intent on building more outlets instead of first understanding how to make their existing outlets profitable by getting more of their members to visit more often
There were others, of course, but I was taught long ago that 3 bullet points is all you need so I’ll stop there.
Why does this happen? To my mind, there are three fundamental reasons – sometimes driven by diametrically opposite dynamics that work in organizations at different stages of development.
- Lack of understanding of what a differentiated strategy should look like
Many clients we meet don’t really understand the power of a clear strategy. They think doing what their competitors do, slightly cheaper, faster or better, will do the trick. They’re endlessly tactical in approach, always rushing to produce one more “seasonal” or “topical” campaign rather than setting up a clear long-term strategy built around a clear brand architecture
2. Disconnect between the data and the decision-makers
This happens usually because the person who has access to the data doesn’t have to make decisions and the person who’s making decisions doesn’t have access to the data.
I’ve seen it happen in a large organization where the research director thought her job was to manage the research budget and timelines for delivering the research projects marketing commissioned. She never thought about things in the context of what decisions needed to be made, what sorts of information were required, what already existed and therefore what minimum additional information needed to be generated. The head of marketing, on the other hand, never thought in that way either, so the briefs to the research team were not based in information requirements for strategic decision-making.
I’ve also seen this happen in startups where the CEO doesn’t understand marketing / consumer data, someone else is managing the consumer / transaction data but doesn’t use it to create reports or headlines for the CEO to act on.
Both of those situations lead to lack of a clear research / information management framework and break the link between strategic decision-making and the data that should guide it.
3. Lack of ownership of an overall business outcome
This is slightly linked to the previous point but a bit different, tending to happen more in larger teams where a silo mentality creeps in. The core problem is that people think they’re responsible only for one specific thing rather than understanding their role in driving an overall business outcome.
For one client, the head of marketing kept telling the entire marketing team that their job was driving traffic to the store – what happened after they got there was not their problem. They didn’t spend enough time thinking about what consumers did in the store, what they did after they bought the product and experienced it, how they then talked about it to other consumers – all essential parts of the purchase-decision-making chain and therefore of marketing strategy. Brand managers thought their role was to get briefs out the door on time so the agency could come back with campaigns – not collate everything the organization knew about the business to identify what they really needed to do to drive it forward.
At another, each “brand manager” focused on their role of driving either annual subscriptions or one-off orders without understanding that often the same consumer was behind both kinds of transactions and that there was considerable overlap between what they were all trying to do. The “consumer service hotline” people thought their job was offering compensation for damaged product rather than understanding how disappointed the consumer was and finding ways to address that disappointment with the brand. Small wonder that the brand lost large proportions of its heavy users when their subscriptions ended.
How do you avoid these situations?
Well, for starters, it’s really important to understand how information / data / research feed a good, differentiated business and marketing strategy, and what that strategy should look like. This means, right at the start and perhaps every 2-3 years, doing a thorough business and marketing review, ensuring there is a well thought-out strategy in place based on consumer, market and business knowledge.
Then, it’s important to preserve the link between information and decision-makers so that there is constant input into the ongoing progress of the business against that strategy. This means a proper MIS system so that on a regular basis, key business information is reviewed by the people who make decisions from it. A marketing head who does not know revenue and brand health data or a CEO who doesn’t know last week’s numbers can’t make good decisions about the business.
Last, it’s important that everyone in the organization sees their role in driving the holistic goal that defines success for the business. When people define their role very narrowly they are likely to miss the wood for the trees.
You’ll notice that my headline had the word “insight” in it and I’ve very cleverly avoided getting into it later on. I’m not going to get into it now either, except to say insights are what you build strategic choices on. Sometimes that means taking a leap from the data you have, sometimes it means unearthing data that other people don’t have – either way it gives you an “aha” moment on a way to build your business that isn’t entirely obvious until you see it.
At Searchlight we work with our clients to help them make better decisions about business and marketing strategy. A big part of this is creating better processes and decision-making frameworks that align different internal specialists and all internal and external information around a clear organizational objective and strategy. Reach out to us at enquiries@searchlightchina.com for more.