There’s a famous quote often attributed to W. Edwards Deming: “Without data, you’re just another person with an opinion.” Pretty catchy, and it’s a mindset many of us default to. But Kevin Gray nails it better: “With data, you’re just another person with an opinion. Data by themselves have no meaning.” https://www.linkedin.com/pulse/hard-hat-stats-some-common-uncommon-sense-june-23-2024-kevin-gray-gegwc/ One of the hardest jobs for a CEO is determining what opinion on the data is correct. Two recent stories showcase this challenge: Amazon’s massive losses on smart devices and Nike’s recent struggles as part of a data-driven pivot. These stories are intriguing, but I’m more interested in how the decisions behind them were made. In an article by Dana Mattioli, Amazon’s continued investment (and losses) in smart devices were driven by a metric called "downstream impact" (DSI). This internal measure aimed to track how a product influenced spending across Amazon’s ecosystem but had significant flaws, including double-counting revenue. Why bet so much on DSI? It was developed by a team that included a Nobel laureate—in a world of opinions on data, this team would have a strong argument. https://www.linkedin.com/posts/dana-mattioli-7b09779_alexa-is-in-millions-of-householdsand-amazon-activity-7221495240203866112-b8_I/ Another example is highlighted by Massimo Giunco’s recent article on Nike which breaks down three critical decisions by CEO John Donahue that have hurt Nike: - Eliminating categories from the organization (brand, product development, and sales). - Becoming a DTC-led company, moving away from wholesale. - Centralizing and digitizing marketing, making it heavily data-driven. Nike used data science to help make these decisions. The result? Nike has lost billions in market cap, its share price has hit lows not seen since 2018 and it now has a new CEO. https://www.linkedin.com/pulse/nike-epic-saga-value-destruction-massimo-giunco-llplf/ Both articles point out that data played a key role in these strategic choices. If data is the Holy Grail of decision-making, how did these decisions go so wrong? It’s clear that data alone isn’t enough. What does this mean for CEOs and marketing? Marketing teams are flooded with data yet still make poor choices—pursuing ineffective growth strategies, wasting money on unproductive marketing channels, and rolling out initiatives that damaged the customer experience. So what can CEOs do? Before making significant marketing decisions, make sure your team addresses these points: - Ensure the decision aligns with your company’s vision and principles. - Explain how it supports customer needs and enhances the experience. - Present opposing viewpoints. - Define how success will be measured using real numbers, not vanity metrics. - Set clear goals and decision criteria upfront. If these steps don’t lead to clarity, you have to trust your gut.