Agency “Datanomics”

Posted: February 8, 2008 in Agencies, Datanomics, Emerging Media, Marketing Links, Mobile, The Marketing Industry, Trends
Tags: , ,

Watch out world – I had to do it. There’s a newly created new-marketing/business term coming our way. Actually, the dynamics behind the concept have been at play for some time now, so it was just a matter of time before someone articulated it as a one word addition to our growing lexicon.DATANOMICS

First, let me fill you in on where the motivation behind this post came from. I was inspired by the Group M deal with Celltick in Asia, (Celltick delivers a ‘LiveSreen’ streaming ad interface to millions of mobile handsets), to write a post titled “When Looking For Mobile, Look Overseas”, when it dawned on me that there was a bigger story here. A much bigger story (well at least the straw that broke the camel’s back for me), a story about data value, about sharing case studies and key learnings, about leveraging standardized tools and technologies, developing proven processes and techniques, globally. Hence the birth of Agency “Datanomics.”

Update: the announcement in MediaPost about Publicis adopting a yield management system (Rapt) to create digital media buying efficiencies and collective knowledge across its portfolio of agencies, including Starcom Mediavest, Zenith Optimedia and Digitas, is exactly the type of system that will become standard at the holding company levels. Scale does offer tremendous benefits in the world of datanomics!

I continue to see many non-big-agency-folks bashing the big guys for not ‘getting’ digital channels (granted up until recently they certainly deserved some of the bashing). But I must say, big things are happening and I think many naysayers out there can’t see the forest for the trees. Some of the big guys do indeed get it. In my “Agency Darwinism” piece, I point out that WPP’s digital revenue represents 23% of the total $29 billion in 2007. Barely a week goes by without news of another WPP acquisition or strategic partnership. Kudos guys. Keep keeping on!

Of course the market forces that affect agencies affect marketers, publishers, technology providers, content creators and all parties in the entire ecosystem. But of course I am partial to focuses my thoughts and writings more so on the agency ecosystem specifically.

So with that background, I introduce to you, “Datanomics“: The study and practice of creating direct and indirect value by leveraging data at all points in the business, encompassing everything from simple communication of collective experience and knowledge to the implementation and management of sophisticated data analysis tools and dashboards. In practice, it is a mindset, always focused on how to harness and leverage data for planning, evaluation or implementation of any and all business investments. It’s the application of econometric thinking at all levels of the organization. Essentially Datanomics is not just about measurement, analytics and modeling, but the strategic thinking and pragmatic application behind it. Datanomic training would include helping all staff understand how to think about data inputs, and outputs as well as possible correlations between different data sets.

I would argue that the most successful digital or integrated agencies of today are those with a strong Datanomic position.

A company’s “datanomic position” affects its overall position in the market, creates or impedes competitive advantages, creates operational efficiencies and increases profitability. A global presence automatically expands a datanomic position, while firewalls between divisions hamper it. Human resources and technology will both play a pivotal role in driving Datanomics, but the human role is an essential one. The levels of technological progress has outpaced that of our ability to absorb this progress at scale. Therefore pockets of “those who understand how to use and/or apply the technology and tools” and “those who do not” have emerged.

Understanding how to apply the additional dimensions of data and the dynamic interactivity of digital media to the planning, execution and evaluation of marketing investments, is a requirement for the transformation of “traditional” agencies, who truly wish to become integrated and ready for battle in the new age of marketing before us, as opposed to simply marketing themselves as such.

After speaking about a data driven marketing and business economy for many years, I had to stick the stake in the ground and coin a new term to describe the concept. It’s not a buzzword, it’s just a term. A term with real meaning. Remember, Datanomics relates to the requirement of an ever present cognizance of the data-dimension. Direct marketers have been riding this wave forever. But data is now in the realm of all marketers and all agencies, DR and brand advertisers alike. Your ability or inability to embrace this data-cognitive approach can affect your competitive positioning, the work you do for your clients, and ultimately your ability to maximize agency profitability in the future. I’ve watched agencies embrace data, new tools, systems and ways of thinking, while many others have feared it. There is no choice any longer.

So what’s your Datanomic position compared to your competitors?

Advertisements
Comments
  1. Hey,

    I would love to discuss this as I see it has a lot in common with our project, but only offline.
    do not hesitate to contact me.
    Martin

  2. I have pretty much the same reaction Jerry Maguire had to the word “Coin” pronouced KWAN.

    “That’s your word? I like it!”

    Totally appropriate for this moment of convergence between economic, statistical, psychological and sociological thinking.

    Economics today is bringing in psychology and sociology, and looking for economic explanations for behavior.

    Typically right-brained agencies ought to learn how to benefit from the wealth of data now available to them. Client-agency relationships benefit from agreement on metrics that make sense, and CMOs and marketing directors will find them selves in stronger positions with their management when they can demonstrate the wisdom and effectiveness of their programs through valid data.

    The other side of mastering Datanomics is defensive. Bad data, less than valid metrics, good measurement of the wrong stuff, wrong-headed interpretations of good data will swamp good thinking and communicating and often do.

    Let’s all get Datanomic!

    Mark DiMassimo

  3. Michael Mina says:

    Using a single term like “datanomics” can help focus and clarify our thinking on the interplay between the affected subject areas. I hope to read more about this topic, and I will mention this on my blog and encourage others to follow the development of this concept. I will also mention this in the Business Intelligence and Database Marketing classes I’m scheduled to teach. Well done.

  4. Datanomics as your outline it seems to be organization 2.0 + marketing 2.0 + knowledge management 2.0…but more inclusive.

    The larger question I think is if data management is framed as a centralized top down action vs. more bottom up and decentralized forms of knowledge management. In other words, if its oriented toward more flexible or more procrustean and restrictive technologies of management. If its the later, you may end up with a Meatball Sundae effect.

    Also, is the knowledge management a closed system or an open one? My guess is it would be different based on individual initiatives and organizations.

    When you say, “Essentially Datanomics is not just about measurement, analytics and modeling, but the strategic thinking and pragmatic application behind it. Datanomic training would include helping all staff understand how to think about data inputs, and outputs as well as possible correlations between different data sets.” It sounds like very much like making communication (data management) and technology efficient and productive. Interesting.

  5. Kevin Lee says:

    The challenge is that the kind of employees that the agencies are used to hiring are not very savvy quantitatively. Its not that they are dumb, not at all, but their curriculum’s and experience don’t prepare them for Datanomics. To find staff that are ready for Datanomics, you have to pay more than $30K a year starting salary.
    The publishers and ad networks are trying to make their systems idiot proof while data-centric agencies are applauding the extra targeting tools that come with complexity. Where will thinks end up? Wait and see.

  6. mike says:

    Hi Jason, I just came across your blog and was wondering if you could help me out with a question. Who do you think the leaders in data-driven digital agencies are right now?

    Thanks

  7. […] [Feb 8] Agency “Datanomics” : A piece about the necessity of data driven processes for agencies to remain […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s