A few years ago my good friend Pat Coyle, who owns a sports marketing agency, encouraged me to read Moneyball. For one reason or another, I never put the book on my reading list. A few weeks ago I watched the movie and instantly ordered the book so I could dig into the story even deeper.
I’m not a sports guy… you may not be either. I seldom get excited about any college or professional sports game unless it’s a good Stanley Cup. If you don’t appreciate sports but you love numbers, statistics and analysis, you should still read this book. Paul Depodesta (his character is Peter Brand in the movie played by Jonah Hill) is the brains of the operation… working from statistics to identify target players based on their on-base percentage. It doesn’t matter if it was a single, double or even a walk. Billy Beane is the muscle… the General Manager that bets his team and his career on using the stats (as well as an aggressive trade practice that yields more funds for talent) to take the Oakland A’s to a historical winning streak.
I won’t ruin the story for you, but here’s an overview. The Oakland A’s have a third of the budget of most teams to buy talent. In order to compete, they needed something else – analytics. The baseball industry is just like any other industry, as it has grown in age, size and wealth, institutional knowledge runs deep. The problem is that the institutional knowledge is wrong… very wrong. Games are statistically won and lost on hits and runs, not on errors, home runs or won by beefy, square-jawed athletes. Think about your own business and the assumptions you make because it was always done that way.
The problem in Analytics industry is two-fold. While our marketing tactics have evolved beyond our site and user interaction has changed dramatically (mobile, video, tablet, social, etc.), when you log in to your web analytics you pretty much see what we saw a couple decades ago. The other problem is that institutional knowledge has poisoned the very foundations of the industry. All of the latest analysis and measurement tools that are helpful are being developed outside the industry.
Marketing professionals’ success is often gauged on bounce rates, page views, fans and followers… when they may have absolutely no statistical impact on actual business results. It’s true that errors and homeruns can change the course of a baseball game, just as a high influx of pageviews could influence business… but the question is whether or not it’s a performance indicator you can directly influence.
What ultimately matters to every business are both leads and conversions. Think about how you set up an analytics account. The first question is what domain your analytics will be installed on?! That’s the wrong question altogether, the question should be how do you obtain customers? Then the news question should be where do you obtain them from. And how many you wish to grow by. At that point, the analytics platform should help capture every stat and help you understand which ones matter and which do not.
Every analytics professional should read Moneyball and reshape their understanding of how businesses drive results online – whether it’s an ecommerce site with direct sales, a web publication that gains revenue through advertising revenue based on visits, a service company that needs to drive appointments, a technology firm that needs more web demos, or a company simply trying to impact the sentiment and reach of its brand.
Web analytics is a one-trick pony… trying to fit an antiquated toolset into all these new scenarios. We need a new toolset that starts with the scenario and show us how to measure the success across any medium or platform.
Consider why machine learning and predictive analytics can provide top- and- bottom- line value to organizations like yours with the right tools, training, and processes for a range of objectives and use cases.