Here’s the thing: investment in data analytics is continuing to soar, even despite ROI proving mediocre in many instances. A CMO Survey conducted by Duke University, Deloitte LLP and the American Marketing Association showed that the percentage of marketing budgets allocated to analytics will increase from 5.8 percent to 17.3 percent over the next three years—nearly 200 percent. However, the same study showed that the effectiveness of data analytics was rated just 4.1 on a seven-point scale, up from just 3.8 in the past five years. What does this mean? It’s no longer enough to look at trends in digital transformation and push data analytics as a tool for growth. We need to start looking at specific data analytics trends that can actually help companies start to improve the results they’re achieving once they start moving toward data itself.
The Following are Five Key Data Analytics Trends to Watch for in 2019
- Stop Making Everything So Complicated
I’ve discussed before that many companies are over-doing data collection and under-doing data-backed decision-making. They’re collecting so much information that they’re opening themselves up to unnecessary security risks, not to mention data storage costs. They’re focusing so hard on finding complex algorithms that they’re failing to use the data in a timely manner. What we need to start doing is going back to zero—data analytics 101. Determine what you’re trying to do, and determine the precise data metrics you need to get there. You don’t need to begin with a masterpiece. You just need to begin with data that can move your company forward. If you’re one of those companies trying to do calculus when you need to be doing basic addition and subtraction, you know who you are. Revert accordingly.
- Focus on Culture, Not Algorithms
As with most things in digital transformation, you will only be as successful as your company culture permits. If your culture is one of old-school legacy thinking, where everyone knows data is never a factor in decision-making, and the data you pull sits on a shelf months before it’s ever analyzed—of course your data initiatives will fail. In terms of data analytics trends, you need to focus on walking the walk—encouraging a culture of hardcore data love throughout the enterprise. Without this, you will always come out short in data analytics ROI.
- Automate—and Augment—Whenever Possible
If you want your data analytics investments to pay off, you need to invest in AI. It’s the only thing that can help sort through the masses of data your company needs—in a timely manner—to gain any type of gain-worthy insights. Data analytics was not meant to exist in a spreadsheet in the corner office. It was meant to be a living, breathing entity that flows through the enterprise—and beyond. You need to invest in automating its movement and processing to ensure that it works for you when you need it. Learn more about augmented analytics, which we’ll be hearing even more about in the next year, here.
- Focus on Data-centric, Not Data Backed, Decisions
I know: tomato, tomahto. But there really is a difference. Being datacentric means that your company prefers to make decisions based on data. It doesn’t just try to back decisions with numbers. It has an absolute bias toward basing all forward movement in the company on data itself. It’s a minor change in terminology—but a huge change in mindset. We’ll be seeing it a lot in the next year.
- Move Beyond the Silo to Third-Party Data Sharing
It makes no sense to hoard data in digital transformation. Sooner or later, we’re all going to realize that the more we all know, the more we all grow. That’s why we’ll be seeing a push toward third-party data sharing in the coming year. It helps us all eliminate the issue of reinventing the wheel that someone else in our industry—or another—may already have created. It helps us bug our customers less often. It helps create a more holistic view of our customer universe. In short, it’s smart. And it will help all of us gain more value from the data we already work with.
There is no easy fix to ensuring your data initiatives will work in your favor. But that doesn’t mean data analytics is going away anytime soon. It’s estimated its value will be more than $77.6 billion by 2023. Your company can either invest with gains—or invest with losses. But at this point in digital transformation, there is truly no option to skip data analytics altogether.