Imagine getting into the cockpit of an airplane and preparing for takeoff. You’re all strapped in, but you discover that all the indicators – and the entire dashboard itself – are missing. How would you know how fast you’re going, how much fuel you’re burning, and which way you’re headed?
Yet that’s exactly what marketers without an effective dashboard do every day: they fly blindly.
In this special in-depth report, we’ll explore why many marketers don’t use dashboards – and why those who do use ones that aren’t effective. You’ll find out why they’re an essential cornerstone of marketing, what to look for in them, and the benefits you’ll receive.
1. Evolution of Dashboards
2. The Lag in Marketing Dashboards
3. New Technologies, New Opportunities
4. Benefits Dashboards Should Offer
5. Dashboard Types and Designs
6. Essential Information and Metrics
7. The Future: Predictive Dashboards
Evolution of Dashboards
Businesses create dashboards to gauge performance, monitor progress, and make decisions. Rather than a short-term fad, their use in business is only increasing. This is evidenced by marketing giants such as Google, which recently announced improved, consolidated dashboards for local business, and Pinterest’s recent launch of an analytics panel for business.
What are business dashboards? They provide at-a-glance views of key performance indicators (KPIs). Effective dashboards are easy-to-read, real-time user interfaces, providing a graphical representation of these KPIs. They enable faster insights, and better, more profitable decision-making.
The term originates from the automobile dashboard, which allows a driver – at a glance – to make key decisions, such as whether to refuel or change speed. An effective control panel monitors progress and performance, as well as enables you to manage risk and monitor whether you’re on track.
In business, dashboards first appeared in the 1970s. Manufacturers were among the first adopters, using them to measure targets, output, productivity, and more. But due to the limitations of computing power at the time, and incomplete data spread across multiple sources, little progress was made during the next couple decades.
By the 1990s, dashboards started appearing that are similar to those in use today. Advances in computing power, as well as data processing and warehousing, enabled improvements in analytical processing, allowing them to serve as a more valuable tool.
By the year 2000, the use of dashboards really took off, with the growing popularity and importance of KPIs. Today, they’re considered an essential component of Business Performance Management (BPM).
The Lag in Marketing Dashboards
The dashboards of the early 2000s were often were color-coded reports, rather than interactive, predictive tools. And that’s where many marketers have been stuck.
Marketers: Underutilizing Dashboards
Marketing dashboards today need to be more than just graphical representations of data. While these tools are informational, marketers are failing to transform these into higher level, strategic tools.
Even worse, 40 percent of the nearly 400 participants in the recent ITSMA/VEM annual MPM (marketing performance management) study indicated they are not using a any at all.
Marketers: Activity-Oriented Dashboards
As for the marketers who are using dashboards, they report on marketing activities rather than business outcomes. That’s like an airplane control panel indicating altitude and airspeed, but providing no information about location, direction, and whether you’re on course.
Limited Tactical Information
Most of these activity-based dashboards reveal tactical, channel-specific information. For example, typical marketing software focuses on things like email campaigns, and the number of opens and click-throughs. But what’s really needed is strategic, enterprise-wide information.
Fails to Prove Marketing’s Contribution
Most marketing dashboards today fail in their inability to show marketing’s contribution to the business, financial and otherwise. Marketing is one of the last areas of business to adopt technology to measure effectiveness. When marketers can’t or don’t prove their value, they put the resources they need at risk.
New Technologies, New Opportunities
It’s been difficult in the past to prove a causal relationship between marketing investment and business results. But new technology makes this easier than ever before. In recent years, the marketing technology landscape has increased to more than 900 players, up from roughly 100 only a few years ago.
That’s largely due to the advent of digital marketing and big data. In the past, marketing was more qualitative and often based on creative instincts. Today, marketing is much more quantitative, and it’s much easier to measure marketing efforts and their success. The convergence of data and analytics is both driving the demand for marketing dashboards – and enabling their evolution.
“Marketing technologies enable amazing new ways for marketers to manage their organizations and engage with their audiences — but they require new thinking, new practices, and new skills in the marketing team to realize their potential”, said Scott Brinker, Co-founder & CTO of Ion Interactive.
“Integrating software into your marketing strategy and operations — building up a new generation of critical, intangible capital around it — is a major study in change management. Companies are making these changes. But it’s hard work, and it doesn’t happen overnight.”
Benefits Dashboards Should Offer
To be truly effective, a marketing dashboard needs to offer a unified, strategic view. It needs to be big picture. Marketing is changing: C suite executives increasingly expect to see proof of how marketing is moving the needle, how it’s contributing to the enterprise bottom line. An effective marketing panel needs to show a connection between its investments, activities, and outputs.
Connected to Marketing Plan
An effective marketing dashboard is directly connected to the marketing plan. When the marketing plan is aligned to business goals, and is measurable, it serves as the blueprint for your control panel. Indeed, the metrics chain defined in the marketing plan is the foundation for the KPIs you select for your dashboard.
Compare Targets Versus Results
Effective marketing dashboards enable you to compare targets to actual results. Did we achieve what we intended to achieve? Most marketers are reluctant to put a stake in the ground, so their reporting doesn’t tell C suite what it needs. Effective control panels keep marketers focused on which business needles they’re trying to move. They’re an essential tool for accountability.
Connect Investment and Return
Business has become increasingly driven by quantifiable data, due to ever greater access to information and computing power. Except in marketing. And this creates a disconnect between marketers and the rest of business. Marketers have long struggled to effectively communicate their contribution to the business. A dashboard needs to help them discover how to improve their contribution to the enterprise bottom line , and why they deserve money and resources.
Your control panel should also enable you to see the relationships between the various facets of marketing. With more than 60 different channels today, marketing has become extremely complex. This complexity makes measuring the synergy and benefit between different channels difficult. For a marketing dashboard to be effective, it must provide insight into the how well the overall system is operating.
Improve Decision Making
An effective dashboard needs to foster C-suite decision making, specifically decisions around strategy and investments. This also helps marketers be more aligned with enterprise initiatives, and show that they’re thinking and behaving like business people.
Facilitate Adjustments and Corrections
An effective dashboard provides a unified view of “how we are doing.” This enables a business to make adjustments and corrections, maximize the effectiveness of marketing, and boost marketing ROI.
Provide Actionable Insights
One of first things to assess is whether the information provided is actionable. A dashboard should provide information that helps make better decisions on future activities. A system that provides information that isn’t actionable, isn’t useful.
Dashboards Types and Designs
Dashboards are often defined by their function, and can be classified as such. There are four main types: strategic, analytical, operational, and informational.
These support business at all levels of the enterprise, including the C suite. They focus on executive-level views of performance and forecasts, and give decision makers a quick overview of the health and opportunities of business. They often offer a top-level, long-term overview of key metrics, rather than real-time snapshots of day-to-day minutia.
These systems are for analysis, and often include more history, context, and comparisons. They focus more on allowing users to interact with the data, such as drilling down for details and trends.
Operational or Informational
These are for monitoring operations, and are quite different from those that are strategic or analytical. They are more suited to monitoring situations that are constantly changing, and which might require immediate attention.
Dashboard Design Best Practices
There are four essential design elements of an effective dashboard:
- Presents relevant metrics and KPIs and their performance targets in an consistent, easy-to-consume “look and feel”
- Reflects the relationship(s) between the metrics and their impact on the outcome(s)
- Accounts for performance thresholds and integrates alerts when appropriate
- Provides directional guidance on what adjustments if any are needed
Essential Information and Metrics
Dashboards typically are based on these types of information: data, measures, and metrics
- Data: A fact or piece of information, such as gender
- Measures: A dimension or an amount, such as weight
- Metrics: A benchmark or a standard, such as Body Mass Index
Every marketing dashboard should feature the six categories below, including both targets and actual results. These categories represent the essential job of marketing: finding, keeping, and growing the value of customers.
- Customer acquisition and retention: Number of customers, retention rate, acquisition rate, etc.
- Customer value: Lifetime value, loyalty, share of wallet, etc.
- Customer equity: Referral rate, propensity to repurchase, etc.
- Product innovation and adoption: Rate of product adoption, revenue from new vs. existing products
- Competitive market value: Category ownership, rate of growth compared to competitors, market share growth
- The bottom line: Show me the money. What are we investing, and what are getting in return for that money?
The Future: Predictive Dashboards
Returning to our airplane analogy, when they were first invented they had no fuel gauge. The same was true with cars: when people first drove cars, they had to carry a gas tank because there was no way to know how much gas they had remaining.
Yet in today’s cars, dashboards are predictive. Your control panel will not only let you know how much fuel you have remaining, but predict how much further you can drive before you run out of gas.
The most effective business dashboards are also predictive. They incorporate thresholds and alerts to prompt corrective action when needed. Are we off course? How likely will make or miss our target? Will the current investment be enough? This requires that marketers build analytical models that foster predictive analytics, and improve their ability to predict the potential value of making a particular change.
You can only get there if you know where you want to go. Dashboards enable marketers to clarify their objectives and goals, monitor whether they’re on track, and make course corrections where necessary. Like the pilot of a jet, you need a control panel to monitor your progress – and get you to where you want to go.