Businesses Spending on Big Data Marketing but Not Hiring for It

New study shows marketers are investing in technology to drive data-driven marketing activities, but there's an alarming lack of skills

A report by data-driven marketing specialist Infogroup Targeting Solutions found that companies are continuing to ramp up their spending on big data marketing initiatives in 2014 (62 percent of companies expect their big data marketing budgets to increase). However, most of those companies are focusing on technology, not people-57 percent of companies say they do not plan to hire new employees for their data efforts in 2014.

That may be a costly error in the long run, says David McRae, president of Infogroup Targeting Solutions.

"The survey findings also indicate that marketers are moving from the information-gathering stage to the analytics phase of big data adoption," McRae says. "But a downturn in hiring could stall big data implementation, as the need for human capital is greatest during the analysis and action stages."

"Big data is meaningless without manpower," he adds. "While it's exciting that most companies are making bigger investments in big data, marketers should not forget that it takes people to make sense of the information. Hiring before reaching the analytics stage enables companies to become data-led and act on the data."

Of those marketers that are planning to hire for data-related positions this year, 59 percent plan to hire a data analyst or strategist.

Infogroup surveyed nearly 400 marketers at the Direct Marketing Association's DMA 2013 conference in October for its Big Data's Big Step report. It found that 54 percent of marketers have already invested in big data, and 61 percent of those early adopters already report positive ROI. Also, many marketers expect to start seeing a positive ROI in the next year (23 percent) or two years (23 percent).

Additionally, more than half of the early adopters say they are well into or past the initial data access phase of their initiatives, having conquered the challenges associated with data collection and cleansing. Those early adopters are now focusing on what Infogroup calls the second and third phases of adoption: insights and deployment.

Marketers have also shifted their perceptions in terms of the barriers they see to big data adoption. In 2012, Infogroup says half of respondents said analyzing or applying data would be their biggest data-related challenge in 2013. Fast-forward a year, and respondents say that budget limitations (35 percent), lack of quality data (27 percent) and limited tools and technology (25 percent) are the biggest challenges they face in using big data to deliver multichannel marketing programs.

Four Tips for Staying the Course with Data-Driven Marketing

To help marketers become more data-driven, Infogroup offers four recommendations:

  • View big data adoption as a process. Big data adoption isn't a goal. It's a means to the end of improving customer engagement, increasing retention and loyalty and optimizing marketing performance over time. Keep in mind that big data adoption is a multi-year investment that requires planning, resources and patience.
  • Start now and be deliberate. Since you can't tackle big data in a day, you should start small and be intentional about implementation. Start now or risk falling behind competitors who are already moving on to more advanced phases of implementation.
  • Temper expectations about ROI. Yes, many marketers say they're already seeing returns on their investment in big data, but a comprehensive multi-year investment strategy takes time to pay off. Initial returns may be small, but let those early returns give you the patience to continue building out your strategies in the more difficult phases of analytics and deployment.
  • Spend on people, not just technology. It's true that technology is essential to making a big data initiative work, but it's a critical misstep to overlook talent. People are the ones who make data meaningful, and not hiring the right employees or partners can cause your otherwise sound big data implementation plan to fail. Additionally, McKinsey and Company have predicted that by 2018, the U.S. will face a shortfall of 140,000 to 190,000 data analysts and 1.5 million data managers. Companies that hire early are likely to fare better.

"Big data implementation is a multi-year process that requires sustained investment in technology and talent," McRae says. "To maintain momentum, marketers need to create an intentional roadmap because big data cannot be tackled in a day."

Thor Olavsrud covers IT Security, Big Data, Open Source, Microsoft Tools and Servers for CIO.com. Follow Thor on Twitter @ThorOlavsrud. Follow everything from CIO.com on Twitter @CIOonline, Facebook, Google + and LinkedIn.

Read more about marketing in CIO's Marketing Drilldown.

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