Mind the data skills gap

The impending global shortage of data skills professionals has serious implications for marketers, who face ever-increasing pressure to prove their worth and get maximum value from customer data.

Mind the gap

The talent supply of professionals with data skills will be insufficient to meet the demand of global business over the next five years, according to a study by IT consultancy EMC. That is the belief of 65% of workers in the data sciences.

There is also little confidence that firms have the skills to use the data they have to make sound business decisions. Only a third of companies are very confident about making decisions based on new data, according to the research.

The lack of qualified data professionals could be disastrous for marketing, warns Virgin Media director of customer insight Michael Payne: “If marketing is to be seen as an investment, rather than a cost, it must be positioned as a quantifiable discipline. It needs to be seen as much more data-driven. The UK has a shortage of data-driven marketers.”

The situation is unlikely to improve, he says, until more young people choose to study scientific and analytical disciplines at university. The EMC study shows that most people believe graduates are the key to plugging the data skills gap.

But the marketing profession must make an effort to be perceived as a science as much as an art so that data graduates consider it as a career.

Payne says marketers need to be as proficient at writing a brief for a data analysis project as they are at writing a creative brief for an ad agency. They also need to be able to talk about their work in terms of numbers, and the value created for the business. There is a strong need for people who can both articulate the objectives of a campaign and measure its results quantitatively.

Mercedes
Mercedes-Benz: Looks for recruits who can bring data to life for the whole business

But Bupa marketing director Sue Moore believes there is still a “dangerous misunderstanding” about what marketing is. “Nothing annoys me more than when people think marketing is just about creativity,” she says.

“When an interviewee says they are good at art or can write well, that rings alarm bells. That is not what marketing is about. Unless marketing can be quantitative and analytical, it will not be a lead function in the business.”

Moore has been building a team that can do this, taking talent from outside the field of marketing. In recruiting Bupa’s current marketers, she is putting analytical skills above the communication capabilities traditionally associated with marketing (see Case Study, below).

Organisations that get their recruitment policies right will be at a competitive advantage, says Payne. “There are two critical things. One is having the data, and the other is having the skills. We are putting science at the heart of our marketing activities.”

Data skills will be particularly important for companies to ensure their customer offerings remain relevant, argues Yuchun Lee, vice-president of IBM’s enterprise marketing management group. Small and medium-sized firms, which are typically less advanced than larger corporations in terms of their data capabilities, could find themselves able to punch above their weight, he says.

Lee was part of the Massachusetts Institute of Technology’s blackjack team, made famous by its portrayal in the film 21. Players used legal card counting techniques to beat casinos at blackjack games across the world.

Lee says: “There are some similarities in terms of using statistics and data to give you an edge. In card counting, we are keeping track of statistics that are advantageous to the player. There is a David and Goliath aspect, where you can go against the odds if you are smart.”

38% of business intelligence analysts and data scientists strongly agree that their company uses data to learn more about customers

To gain this advantage, the marketing profession needs to ensure trainees are given the relevant skills or convince more data experts to become marketers. Bupa’s Moore says marketing courses will otherwise become “redundant”.

But according to Chartered Institute of Marketing head of research Mark Blaney Stuart, it is digital, mobile and social marketing skills, rather than data, that are dominating the demand for training courses. These are also the areas in which the highest volumes of new course materials are being developed, though data analytics are also a component of some of the CIM’s digital courses.

He says marketing data specialists are most likely to have taken a maths-related degree and then completed marketing modules as a secondary discipline. New CIM courses incorporating data elements are focusing on areas such as key account and customer relationship management, adds Blaney Stuart.

The main cause of the data skills shortage is the ‘data explosion’ of recent years, with a vastly increased flow of data into companies from various sources. To make use of it, businesses need the technology to collect it and the skills to analyse it.

32% say lack of skills and training prevents their company from adopting a data-led approach to business

The abundance of data has resulted from technology becoming central to consumer behaviour. Personal data handed over by customers when they buy goods online is one example. The amount of digital data generated will increase by 40% each year, according to McKinsey Global Institute.

On top of this, business performance is measurable by an increasing number of variables, and wider market data is generated by a growing range of third-party sources. All these data streams need to be sifted for the prized nuggets of information that will have a positive impact on business performance.

Bupa’s Moore adds: “Data is the raw material of the service economy. There is a lot of it, it is very rich and it has a massive amount of value, but you need the skills to extract the data and refine it into insight.”

14% say their company lacks the tools and technology to use data throughout the business

This not only requires one department to be able to analyse one kind of data, but also to collaborate with other departments and outside agencies, where relevant data sets may reside. The most valuable insights are likely to be found when these can be compared to identify patterns.

These patterns can change the way a company communicates with customers and how it evaluates its marketing performance. They can also be used to design new services, such as product recommendations and targeted offers, and determine when best to deliver them. Businesses will miss out on all these opportunities if they lack the skills to analyse and compare data.

Marketers also increasingly need to understand the laws and regulations around data privacy and security. Companies are collecting more and more personal data from their customers as they recognise its value in optimising their commercial operations.

Also important is the issue of consumer trust. Customers are likely to become much more reluctant to allow companies to use their details for marketing purposes if they believe they are at risk of theft or improper use.

IBM’s Lee believes consumers are becoming more comfortable with the idea of giving companies their data when they feel they are getting a valuable service in return.
But he notes that “any technology can be abused”, and low awareness of legal requirements among marketing staff could cause consumers to withhold their personal details.

Speaking at Marketing Week’s Data-driven Marketing Summit in November last year, Tesco Bank head of customer analytics John Halpin pointed out that it is up to businesses to be aware of their legal obligations. One example is the regulations covering credit databases, where he says he needed to do his own research to understand the law.

“You have to opt in every three years, but no-one in the business told me that. You have to budget and adhere to all these policies, you have to be looking at the legislation, and that could mean bringing in new people and putting some money aside.”

65% believe there won’t be enough data professionals to meet the demands of global businesses over the next five years

Clearly, data protection is paramount at Tesco, where the supermarket’s Clubcard loyalty programme data is filtered through other parts of the business, including the bank. Halpin says: “There are more Clubcards out there than there are adults in the UK. There is a lot of data sharing happening, and I can link Tesco Bank customers with the 60 million Clubcard customers.”

Perhaps the rarest skill among marketers with data specialisms is combining quantitative and analytical know-how with creative abilities. While marketers traditionally struggle to demonstrate the value they create using hard figures, data professionals struggle to communicate how data can be of use to benefit the business.

Speaking at Marketing Week’s data summit, Mercedes-Benz marketing director David George said: “We are not just looking for data specialists. We are looking for people who can exist in that function and bring data to life for the marketing department and the business as a whole.”

The CIM’s Blaney Stuart admits that data specialists do have an “image problem”, with the discipline considered “a bit boring”. He suggests this is something that marketers will need to address.

“It is unusual to find both of those skills in the same person, and it is especially unusual to find the best of those skills. We tend to divide into one or the other, and our education system has encouraged that.”

Yet Blaney Stuart also says that finding marketers with both creative and analytical skills should not be too much to expect. In fact, this is precisely the kind of marketer that will be required to identify the creative possibilities of data-driven campaigns, to ensure that the results can be measured quantitatively afterwards, and to appreciate the strategic importance of both aspects to the business.

Virgin Media’s Payne says: “Our one-to-one marketing activities are fundamentally data-driven, but marketers need to have a strategic appreciation of what data can do for their business.

“We will get to a stage where we optimise all marketing based on our data, including the more traditional branding campaigns, which tend to have softer metrics.”

That is likely to become true of all marketing over the next decade – or at least the most effective examples of it. But if brands are to avoid being left behind by their competitors, they need to invest in their data capability now. A recruitment drive that brings more science and maths graduates into marketing is one solution that few companies seem to be adopting so far.

Businesses must also start demanding marketing-specific qualifications where data-related disciplines are to the fore.

But most important of all will be finding the talented but rare individuals who can both use data effectively and also communicate its importance, inside and outside their businesses.

Case study: Bupa

Bupa
Bupa: Recruited data professionals and then trained them as marketers

Bupa has spent the past two years building a marketing team that has the skills to analyse different kinds of data, extract it from various databases and refine it into important customer insights. This enables the healthcare provider to use its data as a basis for making well-founded business decisions.

To achieve this, marketing director Sue Moore says she has often looked outside the marketing profession, picking applicants with backgrounds in other disciplines, such as strategy consultants and analytical researchers.

But as well as being adept at handling numbers and data, marketers must also be confident at “marrying analytical logic with an understanding that customers often respond emotionally and irrationally”, Moore says.

A qualitative and instinctive appreciation of how customers behave remains a prerequisite, even as marketing is becoming a more quantifiable business discipline.

“Those are very rare skill sets to have in one person, so I am sourcing these individuals from unusual places and then training them for marketing disciplines,” she explains.

Moore says these newly-minted marketers also have to know how to collaborate to bring together different data streams. Bupa has three million customers in the UK and 10 million worldwide, holding personal data and healthcare records for every one of them.

In addition to these separate data sets, financial and market data will also be held and processed by different departments within the business.

While this avoids the situation of creating a centralised resource entirely remote from the business functions of the company, there is also a danger of each data team working within its own silo.

But Moore says Bupa brings analysts together in virtual teams to look at where that data intersects. It is an approach that requires the “holy grail of cross-functional working and a mixing of different perspectives”.

But while recruiting from outside traditional marketing talent pipelines has so far proved fruitful for Bupa, there is still likely to be a shortage of data specialists entering the profession unless marketing courses also focus on data skills.

Moore says: “Every marketing discipline needs to have customer data as its source and I would say it is a standard marketing competence – almost a foundation skill set. Marketing development and training programmes need to adapt to recognise that.”

Recommended

Football

Football returns to marketing grassroots

Seb Joseph

Many Football League clubs are showing signs of financial distress with the bulk of the sport’s sponsorship and broadcasting riches going to Premier League clubs. The country’s less celebrated sides, however, are using innovative, low-cost marketing initiatives to boost short-term revenues and build long-term relationships with supporters.

Web comment

Marketing Week

Comments on Mark Ritson’s column, ‘The three rules of brand management’ (www.mwlinks.co.uk/BrandMGMT), sparked furious debate on marketingweek.co.uk. Here’s a selection.