Quantifying the value of work

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It’s fair to assume that, if you’re reading this, a large part of your day job will involve assessing the effectiveness of marketing campaigns – or, perhaps, testing the feasibility and market fit of new product designs.

The insights team is one of the most disciplined functions in any company when it comes to measuring business impact and we hold our stakeholders to high standards when it comes to building that measurement into their plans from the start. However, it’s extremely rare for us to hold ourselves accountable to the same standards of measurement when it comes to assessing the value created by our work.

This is a difficult challenge, but one we must rise to if we are to continue competing for resources in companies awash with data.

In my previous role at O2, the company reorganised a wide range of analytics and research functions into a single, centralised business intelligence team. Any team whose job it was to look at customer data was brought together into this function spanning everything from CRM and profitability analysis to social media monitoring. The cultural benefit of doing this was that there was suddenly a single source of truth when it came to understanding our customers, and the new structure unlocked opportunities to collaborate across all of these disciplines.

However, it also meant the insights team was now expected to report on the value we were creating, consistent with other teams that were directly connected to commercial performance. As the strategic analytics team could show that they migrated several thousand unprofitable customers onto new data plans, creating several million pounds of profit, we were expected to demonstrate the revenue benefit of our investments into brand tracking and customer segmentation. Think about the last insights study you ran and try to quantify the value it created in monetary terms. It’s a tricky thing to do.

We landed on two routes to quantify the value of our work: cost savings and potential revenue. Demonstrating that we were saving the company money, or identifying new price points, dramatically improved our ability to ask for greater investment in insights. Fast forward eight years, and this challenge is even more pronounced in the technology industry, with teams across the company accessing vast ranges of commercial data to measure what they’re doing. And yet, I’ve never had an agency pitch – or even mention – how they propose to measure the investment in a consumer insights study.

This has to change if we are to thrive as an industry in this age of data. Simply showing that research helps increase the company’s level of understanding in customers is fine, but when a chief finance officer is looking at that next to a revenue-per-head model from a sales team – or the results of a product experiment that shows a causal link between a new product feature and user growth – it’s easy to see where the investment will go first.

With the new audience insights team at Twitter, we tried to build this in from the start. Every project we work on comes in via a request system that is automatically tied to revenue databases, so we can analyse the revenue being generated by our work. We can finally demonstrate that account teams at Twitter are 24% more likely to win a pitch if they are supported by our team. This has dramatically helped our ability to pitch for resources and grow our function.

Next time you pitch to a client or design a study, think about how to build measurement into the plan itself. Proving the return on investment of insights has never been more important.

Matt Taylor is consumer insight lead at Twitter

This article was first published in Issue 26 of Impact.