Top 10 barriers to data-driven supply chain marketing

By Carl Melville | Supply Chain companies are data-driven: Firms competing in and across the supply chain, including transportation, technology, logistics, and contract manufacturers are some of the world’s most data-driven organizations. They are better at performance metrics than many of their customers. Most have invested heavily in people, platforms and practices that enable ongoing optimization and continuous improvement.

The benefits of data-driven marketing are well-known. Supply chain organizations are data-driven. Why then, are so few supply chain organizations not data-driven in their marketing?

We benchmark supply chain competitors in multiple marketing disciplines. These are the most common barriers we encounter that prevent firms from embracing data-driven supply chain marketing technologies.

1. Institutional memory

What we already know is often the single biggest obstacle to learning anything new. “We’ve always done it this way” should never be an excuse for continuing to rely on antiquated practices, technologies, and beliefs. If the organization held this view in operations, they would soon find themselves staring into the abyss of bankruptcy. Marketing technologies have evolved at least as fast.

2. Being burned before

It’s hard to find a supply chain competitor that has not been burned in the past by ineffectual marketing endeavors. These take every form and flavor imaginable, but they share one thing in common. They wasted money and squandered opportunity. Worse, they inflicted pain on an organization that was already suspicious of marketing expenditures, enforcing the flawed belief “these things don’t work”.

3. Infallible CEO intuition

One of my favorite quotes from one of my favorite CEOs of all time was when he said to me, “We don’t need to spend money on marketing. Everyone already knows who we are.” A similar and equally disturbing quote went something like, “we don’t need market research. I already know all there is to know about the marketplace and the competition.” An organization with this belief will never be able to effectively incorporate powerful, data-driven supply chain marketing solutions.

4. Fear of the unknown

This one always baffles me. The intent is to deploy marketing technologies and practices that will move you from the unknown and into the known. However, this does require overcoming a different kind of “unknown”. I’ve met few CEOs that will allow that this is the underlying concern.

5. Empirical evidence

Are you going to trust the data, or your lying eyes? We put a large amount of faith in the things around us that we can see touch and feel. The customers we have today were earned through a process that we thoroughly understand. Something new, seemingly untested, and altogether ephemeral is much less comfortable than well-worn empirical evidence. The problem with empirical evidence is that it is based upon what is in front of you now, and can actually be one of your worst enemies when you are evaluating the implications of disruptive technologies and practices.

6. Investment capital

I once went three rounds with my boss (the CEO) about a $2,200 marketing expenditure. In the midst of our discussion, his secretary walked in with a requisition for $55,000 in forklift batteries. He understood the value of the batteries, could tie them to an ROI, understood the risk of not having them, and knew he was getting fair value relative to current market prices. He knew none of this regarding the marketing expenditure. Since he had no background to evaluate it, he likened it to a Las Vegas bet.

7. Analysis paralysis

We often want new things to be perfect. However, the real world is a messy place, and marketing reflects that world. There is no substitute for getting out into the market, deploying capital, testing programs, working with the data that results, and course correcting as you go. Trying to determine everything in advance or trying to get everything perfect will lead to projects that never get off the boards. Data-driven projects need data. The sooner you start, the sooner you will have something to work with, to shape, and to move forward.

8. Fear of disruptive technologies

One of the biggest challenges with disruptive technologies is that they displace previously held philosophies and beliefs. It is one thing to need to deploy new technologies and systems, and to train new people. Completely replacing an (outmoded) philosophy of marketing can be a jarring experience. Savvy marketing professionals that have kept pace with technology, innovation and trends, as well as continuing to invest in their education, are less likely to have this fear.

9. Inertia

While we spend a large amount of time helping organizations course-correct errant programs and malfunctioning campaigns, at least these campaigns are moving. The amount of energy to get a stalled (or never launched) campaign off the ground is significantly higher. Getting the first campaign in the market requires overcoming a type of inertia that supply chain organizations seem to have in abundance. Start today.

10. The shiny red ball

There will always be a newer, better, faster, sexier technology platform than the one you were about to purchase. This is true in almost every technology category, but in those where our background is limited and where review the stakes is high, we tend to demure, hesitate, and second-guess. Almost any system is better than no system. If the homework has been done and the system supports the objectives the organization has deemed worthwhile, then executing today is superior to waiting for yet another innovation cycle. Yet another cycle will be along shortly.
We’re going to stop at 10, but I bet you could think of more. Has your organization overcome the fear of deploying data-driven marketing supply chain solutions? What were your fears and challenges? How did you overcome them?

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[Carl Melville is the managing partner of TMG (The Melville Group) a marketing strategy and execution firm focused on helping supply chain organizations produce superior revenue solutions.]