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Unlocking the Power of Data Analytics
ISBM’s Winter Meeting was all around Analysis, Analytics, and Answers. Charlie Peters, Senior Executive Vice President of Emerson was the keynote speaker. He challenged the audience to prepare for the rapid change that information and technology will bring to B-to-B markets. He described a future that is very different, for instance, for field sales, with the traditional roles of providing information to customers and negotiating with them, being replaced with on-line tools and consistent and transparent pricing and terms. However, customer-interfacing roles remain important for value-added benefits, such as bringing customer insights back to the company. Charlie also discussed how the differences across countries create their own challenge to a global company such as Emerson. For example, in the United States, brands, payment mechanisms, logistics and local service are mature, and pricing is generally consistent. In China, however, brands are less important than trust that comes from personal relationships between supplier representatives and customers. Pricing and payment terms are again dependent on the strength of relationships. There will be a number of value-adds that will become “digital” in the United States long before China is ready.
Charlie’s message was important. Yet, for us, we have seen the power of data analytics on a much broader scale. Over the past several years we have been working with a number of companies at the forefront of using Big Data to transform their businesses. The B-to-B companies we work with and executives we speak to are finding that their channel management and customer interactions must deal with big changes. These changes can be threatening–when channels use modern communication tools to gain access to competitive products from low-cost foreign producers and when channels use on-line tools to sell outside their traditional customer bases. Threats to traditional channels can, for instance, upset the existing local customer service networks. Anticipating these trends can move a company off the defensive and let them design strategies for managing change well beyond better management of information.
Furthermore, smart equipment and devices are producing information that can be an asset, driving future profitability and basic changes in business models. Having equipment that produces insights into its use and performance has long been used to improve products. Today, it is being used to extend a manufacturer’s reach from after-sale service and support to proactively arranging for third-party service to be performed.
Other Keys to Growth
We see other keys to growth in better using information to target opportunities. That was the message of another speaker, Laura Patterson of VisionEdge Marketing. Laura described a marketing analytics center of excellence. She urged the audience to focus their investments toward answering the most important strategic growth questions their leadership teams asks: which new markets, new customers, new products and new channels offer the best opportunities. Being able to address these questions are essential to participating in critical company decisions.
When we think of these exciting strategic growth opportunities, those on the ground in developing databases and tools are much more concerned about the first-step practical issues while those at the executive level should be thinking how the information can be used at a strategic level to take advantage of growth opportunities.
In addition to the investment, there are challenges of integrating many sources of information in a complex organization and in turn making that information available to various users with differing needs. On the positive side, analytics holds the potential to bridge gaps that sometime develop between marketing and sales organizations and between marketing and finance. It was uniformly agreed that the explosion of information and tools for managing that information will change the game in B2B marketing, operations, and strategy. Looking beyond, however, senior executives should see the potential of Big Data as an enabler of growth.
 The Institute for the Study of Business Markets (ISBM), headquartered at Penn State, is a global network of researchers and Member firm practitioners focused on advancing the state of the art and profitability of the practice of B-to-B marketing.