How to Build a Data-Driven Company
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The document provides 10 steps for building a data-driven company: 1) View business metrics through a data lens, 2) Create metrics for aspects without metrics, 3) Tie issues to revenue impact, 4) Structure and store data for analysis, 5) Use analytics for insights and continuous iteration, 6) Conduct controlled testing of hypotheses, 7) Empower action with data-backed decisions, 8) Hire people skilled in analyzing data, 9) Leverage data for marketing and growth, and 10) Provide data access to foster dependency on insights. Taking these steps can help companies make faster, better-informed decisions and outperform industry peers financially.
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How to Build a Data-Driven Company
- 1. How to Build a Data-Driven Company Josh Braaten CollegisEducation.com @JLBraaten
- 2. Josh Braaten • Director of Inbound Marketing, Collegis Education • Vice President of Minnesota Search Engine Marketing Association • Co-Founder of Glass en Masse
- 3. 1. Internet Math is Business Math
- 4. Data-driven companies are… Three times as likely to execute decisions as intended Source: Forbes,The Big Data Boom: Is Your Company Ready? October, 2013
- 5. Impressions * Click-Through Rate = Clicks = Visits * Conversion Rate = Conversions * Average Transaction Value = Revenue – Expenses = Profit Internet Math is Business Math
- 6. Sent Emails * Open Rate = Opens * Click-Through Rate = Clicks = Visits * Conversion Rate = Conversions * Average Transaction Value = Revenue – Expenses = Profit Internet Math is Business Math
- 7. # of Tweets * Avg Retweet Rate = Twitter Impressions * Twitter Click-Through Rate = Clicks = Visits * Conversion Rate = Conversions * Average Transaction Value = Revenue – Expenses = Profit Internet Math is Business Math
- 8. Impressions * Click-Through Rate = Clicks = Visits * Conversion Rate = Conversions * Average Transaction Value = Average Revenue per Quarter * Number of Quarters – Quarterly Expenses = Profit Internet Math is Business Math
- 9. 2. If You Don’t Have a Metric, Make One
- 10. Data-driven companies are… Twice as likely to use data very frequently when making decisions Source: Forbes, The Big Data Boom: Is Your Company Ready? October, 2013
- 13. 3. Tie Issues to Revenue
- 14. Without a System, All Issues Look the Same Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 ue 10 Issue #1 e Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 Issue #10 Issue #2 Issue #7 Issue #9 Issue Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 #8 #9 Issue #10 Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 Issue #10 Issue #2 Issue #7 Issue #9 Issue #6Issue Issue #4 Issue #1 #7 Issue #3 Issue #9 Issue #6 Issue #7 Issue #3 Issue #5 Issue #7 Iss # Issu #5 #3 Issue #7 Iss # Issue #7 Issue #2 Issue #10 Issue #4 Issue #1 Issue #4
- 15. Creating a Metric Was Helpful Issues Reported by Students Issue 1 Issue 2 Issue 3 Issue 4 Issue 5 Issue 6 Issue 7 Issue 8 Issue 9 Issue 10 Issue 11
- 16. We Can Also Tie Issues to Lost Customers Issues Reported by Students with Drops Issue 1 Issue 2 Issue 3 Issue 4 Issue 5 Issue 6 Issue 7 Issue 8 Issue 9 Issue 10 Issue 11
- 17. Issue 1 Issue 2 Issue 3 Issue 4 Issue 5 Issue 6 Issue 7 Issue 8 Issue 9 Issue 10 Issue 11 Opportunities to Improve Look Different Issues Reported by Students with Drops Public Enemy #1
- 18. New Priorities Emerge Issues Reported by Students with Drops Issue 4 Issue 1 Issue 2 Issue 7 Issue 3 Issue 5 Issue 8 Issue 9 Issue 10 Issue 11 Issue 6
- 19. Walmart, Beer and Pop Tarts Source: The New York Times, What Wal-Mart Knows About Customers’s Habits November, 2004 “Start predicting what’s going to happen, instead of waiting for it to happen.” -Linda Dillman, Walmart, 2004
- 20. 4. Store and Structure Your Data
- 21. Target Knows Kids Better Than Parents Do Source: Forbes, How Target Figured Out a Teen Girl Was Pregnant Before Her Father Did February, 2012
- 22. Guest ID # Credit Card Name Email 1000000001 xxxx-xxxx-xxxx-4243 Josh Braaten jlbraaten@gmail.com 1000000002 xxxx-xxxx-xxxx-3053 John Doe johndoe@gmail.com 1000000003 xxxx-xxxx-xxxx-1836 John Smith john@aol.com Tying Everything Together
- 23. Getting Systems in Order is Both Easy and Hard Unique Customer ID
- 24. Jawbone Stores 60 Years’ Worth of Sleep Data Every Night Source: Fast Company, Jawbone Tracked Hundreds of Thousands of Up Users to Find the Most Sleep-Deprived States December, 2013
- 25. Without It, Everything Looks Like This Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 ue 10 Issue #1 e Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 Issue #10 Issue #2 Issue #7 Issue #9 Issue Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 #8 #9 Issue #10 Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 Issue #10 Issue #2 Issue #7 Issue #9 Issue #6Issue Issue #4 Issue #1 #7 Issue #3 Issue #9 Issue #6 Issue #7 Issue #3 Issue #5 Issue #7 Iss # Issu #5 #3 Issue #7 Iss # Issue #7 Issue #2 Issue #10 Issue #4 Issue #1 Issue #4
- 26. Or At Best This Issues Reported by Students Issue 1 Issue 2 Issue 3 Issue 4 Issue 5 Issue 6 Issue 7 Issue 8 Issue 9 Issue 10 Issue 11
- 27. But Never This Issues Reported by Students with Drops Issue 4 Issue 1 Issue 2 Issue 7 Issue 3 Issue 5 Issue 8 Issue 9 Issue 10 Issue 11 Issue 6
- 28. 5. Analytics, Insights and Iteration
- 29. Issues Reported by Students with Drops Issue 4 Issue 1 Issue 2 Issue 7 Issue 3 Issue 5 Issue 8 Issue 9 Issue 10 Issue 11 Issue 6 Public Enemy #1
- 30. Continuous Improvement and Iteration Source: Wired, Mark Zuckerberg’s Letter to Investors: “The Hacker Way” February, 2012 “The Hacker Way is an approach to building that involves continuous improvement and iteration. Hackers believe that something can always be better, and that nothing is ever complete. They just have to go fix it — often in the face of people who say it’s impossible or are content with the status quo.” - Mark Zuckerberg, Facebook, 2012
- 31. An Analytics Swiss Army Knife Provides Insights
- 32. An Analytics Swiss Army Knife Provides Insights Segment Traffic CR(%) Goal Completions Products 80,000 4% 3,200 Locations 50,000 6% 3,000 Home 225,000 1% 2,250 New Customers 10,000 10% 1,000 Service 15,000 5% 750
- 33. An Analytics Swiss Army Knife Provides Insights
- 34. An Analytics Swiss Army Knife Provides Insights
- 35. An Analytics Swiss Army Knife Provides Insights
- 36. An Analytics Swiss Army Knife Provides Insights
- 37. An Analytics Swiss Army Knife Provides Insights
- 38. An Analytics Swiss Army Knife Provides Insights
- 39. An Analytics Swiss Army Knife Provides Insights
- 40. An Analytics Swiss Army Knife Provides Insights
- 41. An Analytics Swiss Army Knife Provides Insights
- 42. Five times as likely to make decisions much faster than their market peers Source: Forbes, The Big Data Boom: Is Your Company Ready? October, 2013 Data-driven companies are…
- 43. 6. Test, Test, Test
- 44. Controlled Testing Verifies Hypotheses and Understanding
- 45. 7. Use Data to Empower Action
- 46. Issues Reported by Students with Drops Issue 4 Issue 1 Issue 2 Issue 7 Issue 3 Issue 5 Issue 8 Issue 9 Issue 10 Issue 11 Issue 6 Public Enemy #1
- 47. Q1 Q2 Q3 Q4 No Social Media 72% 70% 73% 72% Facebook Users +26% +27% +15% +14% Community Users +24% +21% +5% +14% Retention and Social Media Participation
- 48. Source: Harvard Business Review, When to Act on Correlation, and When Not To March, 2014 Correlation and Action
- 49. Help Everyone Have a Say in KPIs
- 50. Help Everyone Have a Say in KPIs 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Original V1: Blue V2: Olive Satisfied Neutral Dissatisfied Qualaroo NPS Ratings by Background Color
- 51. 8. Hire Someone Good at Math
- 52. If You’ve Made It This Far, Hire For Math
- 53. 9. Don’t Forget to Turn Data Collection Into Marketing and More
- 56. 10. Give People Data and They’ll Grow to Depend on It
- 57. Source: Forbes, The Big Data Boom: Is Your Company Ready? October, 2013 Data-driven companies are… Twice as likely to be in the top quartile of financial performance within their industries
- 58. When More Companies Can See Where Issues Affect Revenue Impressions * Click-Through Rate = Clicks = Visits * Conversion Rate = Conversions * Average Transaction Value = Average Revenue per Quarter * Number of Quarters – Quarterly Expenses = Profit
- 59. Where Issues Seem Less Like This Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 ue 10 Issue #1 e Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 Issue #10 Issue #2 Issue #7 Issue #9 Issue Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 #8 #9 Issue #10 Issue #1 Issue #3 Issue #2 Issue #7 Issue #5 Issue #6 Issue #4 Issue #8 Issue #9 Issue #10 Issue #2 Issue #7 Issue #9 Issue #6Issue Issue #4 Issue #1 #7 Issue #3 Issue #9 Issue #6 Issue #7 Issue #3 Issue #5 Issue #7 Iss # Issu #5 #3 Issue #7 Iss # Issue #7 Issue #2 Issue #10 Issue #4 Issue #1 Issue #4
- 60. Issue 4 Issue 1 Issue 2 Issue 7 Issue 3 Issue 5 Issue 8 Issue 9 Issue 10 Issue 11 Issue 6 And More Like This Issues Reported by Students with Drops
- 61. When Ideas Are Vetted With These
- 63. To Produce Wins Like This
- 64. v To Produce Wins Like this
- 65. Thank You