The Future of Digital Analytics

by Chris Meares

Monday, 17th August

Digital Analytics is a relatively new industry, and if compared to the lifespan of a human being, it really is probably still a pre-teen at this point.  I have had the pleasure of spending most of my career in Digital Analytics; although, when I started back in 2005, it was web analytics and it was mainly based on analyzing website log files.  So even though it has definitely advanced in both technology and sophistication over the past ten years, it is definitely not an adult by any means.  With that said, I sometimes wonder what the future of digital analytics looks like, how much more sophisticated it will become and how it will be utilized in 10 years.

To understand the future of anything, we need to look at the past, and the same goes for the digital analytics industry.   Digital analytics was born out of the Internet boom of the early 2000s and the marketers’ fascination with being able to track everything on the web.  No longer did marketers have to worry if people were seeing their messages, they had log files from websites to tell them if people were seeing their messages.  This seemed extremely powerful to marketers, and led to the boom in web analytics tools.  In the beginning, there were a ton of tools in the market to help marketers understand their web traffic and if their messages were getting through to their customers.  Over the past ten years though, the web (and now digital) analytics tool landscape became consolidated. There are really two main players in the US at this point, Adobe Analytics and Google Analytics.  There are other tools out there that have similar capabilities, but they are not as widely used as Adobe and Google. 

Web analytics also transitioned to digital analytics as the web transitioned to everywhere and not just websites.  Now companies are responsible for tracking all things digital, such as mobile phones, tablets, and wearables.  The data generated by all of these digital devices is almost incomprehensible on a daily basis, and companies are rushing to capture as much data as possible from as many places as possible.  What does this mean for the future of digital analytics?  It means there will be vast amounts of data that needs to be extracted, transformed and loaded into data warehouses and combined with other data sources, both offline and online, and then analyzed if a business in the 21st century wants to compete in its market.

The future that I see is one void of “digital analytics” as a practice.  No longer will there be a need for a digital analytics tool, such as Adobe or Google Analytics.  Instead, companies will collect the data on these digital devices and ship it directly to a data warehouse that is maintained and stored by the organization.    This data warehouse will have data analysis and visualization tools placed on top of it, and data scientists and data visualization experts will be the people with the keys to the organizations’ data.  Why do I see this happening?  It is due to many reasons which I will go into next.

Reason #1 – Data ownership and cost

Data privacy and security is a huge issue in the marketplace.  Right now, cloud-based solutions, such as Adobe and Google Analytics, are in charge of storing your data and ensuring the privacy and security of your data.  If you want to query that data, glean insights from the data, or disseminate that data to your organization, you must rely on access via these third party providers.  On the other hand, if you could collect the data yourself and send it directly into a data warehouse that you control, you are cutting out the middle man.  This solution has many benefits; first and foremost, you are the only person that now has access to your data.  If Adobe or Google is hacked, your data is not compromised.  If their data center goes down, it no longer affects your ability to access the data.  You no longer have to pay Adobe or Google the money to collect and store the data.  Are their costs with storing the data yourself?  Of course, but in the long run, it would be a savings over paying Adobe or Google to do the same thing, not to mention the benefit of having the data at your fingertips at all time.

Reason #2 – Data integration

Right now if Adobe or Google is collecting your data, you still have to bring that data into a data warehouse in order to combine it with your other data sets.  The major benefit of these two tools is the ability to query the data and view reports on that data in a nice interface.  However, the need to combine data sets, behavioral data from digital devices, with CRM data, call center data, sales data, financial data, etc., is where the power of unlocking the potential of the all of your data lies.  One data set by itself can provide some insights, but combining all of your data in one functional data warehouse where you can query and visualize that data is extremely powerful.  This is where you are going to make large changes to your organization, where you are going to be able to get a 360 degree view of your customers and how you are going to grow your business.   So if data integration needs to occur outside of the digital analytics tool itself, what use is the extra cost that you are paying to these third party providers?

Reason #3 – Growth of data scientists

All of this talk about data integration and data visualization across multiple datasets is great, but if you don’t have the people to do the actual work, it is a waste.  Right now, that doesn’t exist; there is a huge supply issue in the market for data scientists.  Believe me when I tell you that will change in the next ten years.  People are starting to realize how powerful this position is at an organization and how valuable a good data scientist is to their organization.  Universities across the US have begun to recognize this also, and are starting to create programs dedicated to data science.  In the next 10 years, the supply will begin to meet the demand and you will see some really interesting things starting to occur in data analysis across organizations.

So where do I see digital analytics in 10 years?  I don’t really see it existing anymore, at least in the same form we see it today.  It will become part of the overarching data integration plan at organizations.   People will no longer just be dealing with digital data; rather, they will be responsible for analyzing the different data sets across the organization and making decisions based on all types of online and offline data.

Is your organization ready for this change to the data landscape?  If not, you need to be and we can help you get there.  Feel free to reach out to me directly to discuss what your organization needs to do to be prepared for the future of digital analytics at cmeares@maassmedia.com.

How do you see digital analytics changing over the next ten years?  Share your thoughts with us here or on Twitter, Facebook, or LinkedIn.

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