Analytics to the left of me, forecasts to my right, here I am . . . . . . . . .

6 September 2017

Alexander McCracken

Alexander McCracken

Global Head of Marketing
As a senior sales & marketing leader, I am drowning in analytics. Attribution analytics, Google analytics, sentiment analytics, pipeline vs. marketing spend, the list is endless (and probably analysable in itself).
 
Here’s my challenge:  these “sources of the truth” tell me what happened yesterday. The leaders in my business don’t want to know about yesterday. They are focussed on what will happen tomorrow, next month, next quarter, next year.
 
Whilst analytics give me an accurate picture of sales and marketing accountability and performance in retrospect (critical at quarter end, when the teams’ bonuses are based on hitting targets), the success of any business operating in today’s economy is driven by futures. So where does that leave me?


Stuck in the middle with you

Alex-McCracken-analytics-to-the-left-of-me-CONTENT.jpgIf like me, you have multiple streams of data about yesterday but your boss wants to know about tomorrow, you probably use analytics to deliver fact and insight for forecasting. That makes sense, it’s what we’ve always done, but let me ask you this: have you ever signed up to a financial product of any kind, and not seen see the following in the small print?
 
“Past performance may not be indicative of future results. Therefore, no current or prospective customer should assume that the future performance of any specific investment, strategy or product will be profitable or equal to corresponding indicated performance”
 
Everywhere you look, there are messages like the above, suggesting; “Just because it happened yesterday, don’t count in it happening again tomorrow.” Right or wrong, the markets expect organisations to forecast what will happen next February, based upon analysis of what happened last February.
 
In the technology industry, this is even more flawed. A year is a lifetime (quite literally in the case of some products). So to forecast next February’s performance based upon last February’s is illogical. When you throw in curved-balls like Brexit and Trump and the unbalancing effect they might have on the market, it moves from illogical to impossible.
 

Forecasting vs. predictive analytics

What is the difference between forecasting and predictive analytics? Ask 10 people, you’ll get 10 different answers.  Here’s my take:

Forecasting is formulated and fixed. It supposes that drivers behind the demand for a product or service are intangible, so uses a statistical model that looks at the past to forecast the future; “we sold 10 things last February and we have demonstrated 20% year-on-year growth, so we forecast that 12 things will be sold next February”. It is sound logic, but not very agile. (Let’s not even discuss the issue that the “50% win probability” of sales person A can be entirely different from B, C, D, etc.)
 
Predictive Analytics are about people/buyers/shoppers and buying environments. They model the future by empathising with, and mapping the behaviour of, the people in the sale, as well as other factors in the sales cycle, not just by analysing the history of the item/service. “That’s witchcraft!” some will shout, but you would be surprised at the accuracy of the prediction. The more data you can use for modelling, the more accurate the prediction will become. This bodes well, as the tsunami of data coming our way (customer data, weather data, location data, etc.) increases exponentially by the hour, whereas the data from your results last February are quite limited by comparison and finite.
 
Which brings us back around to the starting point: I have too many analytics, my bosses want too many forecasts. What we actually need is a predictive analytics platform capable of soaking up the colossal data coming our way and automating the modelling process with “What if?” analyses, auto-feeding us insight and trends, not waiting to be asked for pre-defined reports.
 
This should be beyond “on demand”. It should be proactive – or would that represent artificial intelligence in the sales & marketing world?!
 

 

About the author

Alexander McCracken

Global Head of Marketing
Alex has worked in technology marketing for over 20 years. A keen pianist from a young age, Alex’s dreams came true when he left university and landed his first marketing role in the music industry with Emagic software in the 1990s. Life soon got in the way, he got married and had children, necessitating a “proper job”.
 
Alex joined Hummingbird in 1997 – a software company most famous for AS400 Emulation Systems. He went from working with the Spice Girls to working with IBM mainframes with green screens.  Narrowly surviving both the Millennium Bug and the Dotcom Boom there, Alex learned about B2B marketing at a time where marketing budgets were plentiful, everything was hype and telemarketing was witchcraft.
 
Frustrated by poor customer service he received from marketing agencies whilst at Hummingbird, Alex moved agency-side and a co-founded Liquid Media Group in 2005. Liquid Media was a full-service marketing agency in four countries providing services for Microsoft, Intel, Oracle, CSC, Logica and 1st Software.
 
This loss of creative control that comes with working agency-side (coupled with a bit of a recession in 2008) led him to make the leap back over the fence to corporate marketing, this time to the analytics and structured data space, where he has been ever since.
 
Alex’s B2B marketing approach is very commercially focussed. He prefers a pipeline to a mood board, to the point where many consider him to be “more sales than marketing”. He argues that there is no fundamental difference, it’s all about outcomes, created by empathy and persuasion.
 
Since 2014, Alex has been Global Marketing Director at Bluefin, leading an award-winning marketing team across three continents. Still married, now with three children, Alex remains a frustrated wannabe rock-star.

Bluefin and SAP S/4HANA - welcome to the one horse race