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Where Analytics End and Instincts Begin

Want to improve the consumer’s experience? You probably won’t find the answer in historical data

The Essentials

Over his more than 30 years of teaching and consulting, Ken Wong has seen an evolution in the marketing function and the management of brands. In this third in a series of video commentaries, Wong, Distinguished Professor of Marketing at Smith School of Business, talks about the value and limitations of analytics and how marketing is a lot like dating. 

When I started studying marketing, research was a foundation skill. We ran surveys and focus groups to try and uncover the motivations behind peoples’ behaviour. One of the most common areas was what was known as attitudes, interests, and opinions, a kind of lifestyle analysis. We made assumptions that if you followed a certain lifestyle, you probably leaned in one direction or the other in your selection of brands. Unfortunately, there has never been conclusive research that has shown this to be the case.

What we do know is that we are creatures of habit. To a certain extent, your past behaviour does inform your future behaviour, and that’s really the foundation of Big Data and marketing analytics. Now, we’re not only dealing with what you’re willing to share; we’re dealing with impartial quantitative data generated by the consumer, usually at the point of purchase.

That leads marketers to make certain assumptions. For example, if every four weeks you bought mouthwash, then I know that every four weeks you’ll be more sensitive to related promotions. When that’s combined with the power of the internet, I can direct a promotion specifically to those people who I know are in the market at that time. I’m not wasting money talking to people who will simply ignore the ad or not act on it.

If what you’re looking for is to know when to reach out to someone or what their preferences are, you can’t beat analytics. But if you really want to break through, it’s almost always a matter of a special insight into what a consumer is looking to satisfy. What’s the problem that motivates their search for a product in the first place? If we understand that problem, how do we disassemble it and find a way to improve the consumer’s experience? You don’t find that in historical data. It’s a matter of observing and using common sense and critical thinking.

Consumer behaviour is a manifestation of human behaviour. Let me give an example: in marketing, we talk so much about relationships. What we don’t realize is that it’s not much different from how we form relationships as human beings. What do we look for? Trust, loyalty. How do we avoid the desire for novelty? We constantly introduce new things into the relationship. Even the concept of dating: we introduce ourselves, we go on dates, the dates transform into something greater. In marketing, we have awareness, which is the introduction; we have trial, which is the date; and we have adoption, which is the long-term relationship. Many of the principles we think about when managing our relationships can also inform us as marketers and what we need to do in the marketplace.