Modern marketers have more information about their customers than ever before. Specialists who use data to create a strategy for promoting their products achieve optimal results. Let’s take a look at some of the statistics from Invesp’s research:
- 87% of marketers say that information is their firm’s most undervalued asset.
- 40% of companies want to increase their advertising budget with data.
- Organizations that implement data-driven tactics get 5-8 times higher ROI than companies that refuse such projects.
In this article, we will discuss in more detail what data-driven marketing is, its benefits, and how to implement such a strategy in your business.
The Definition of Data-Driven Marketing
Data-driven marketing (DDM) is a promotional tactic that uses information gained from interacting with customers and third parties to better understand the target audience’s motivations, preferences, and moods. Based on this data, specialists create personalized messages and experiences that guarantee a high return on investment. Let’s talk about the main elements of DDM:
- Identification: creating a clear understanding of the need for data and options for their use.
- Capture: search for relevant data sources about the target audience.
- Analysis: providing access to collected insights to identify relevant segments and gain deeper insights.
- Activation: using the information to activate buyers through appropriate communications and creating a positive experience.
- Optimization: continuously improve performance and make informed short- and long-term decisions.
There are many examples of information being used in marketing, but it is typically employed to segment customers based on their purchases, personalize messages and offers, and retargeting. You can receive important analytics for the company from internal and external sources; for example, the ICOholder platform provides access to all relevant data from the cryptocurrency world.
Pros and Cons of Data-Driven Promotion and Sales
What is the benefit of data-based marketing? In recent years, leads have been regularly dealing with generic marketing messages, making them pickier about the CTAs they want to contact. Data-ruled campaigns are tailor-made, which means that the target audience is more likely to respond positively to messages and ads that address their problem. Consider other benefits of implementing such strategies:
- Marketing attribution optimization: the systems used in data-ruled marketing allow specialists to identify the segment of the promotion budget that has the most significant impact on brand awareness. It lets you cut costs for the organization.
- Relevant content generation: if you know what type of content attracts users, you can deliver the correct data at the right time.
- Determining optimal advertising channels based on insights collected by analytical tools will also help marketers identify which channels are best to use to target their customers.
- Better customer experience: data-ruled marketing uses detailed user profiles to provide an optimal customer experience. It is critical to success because, according to Accenture Interactive, about 50% of consumers are willing to leave a firm’s website and purchase elsewhere if unsatisfied with the service.
Despite the advantages of the strategy, specialists face specific difficulties in the process of its implementation.
- Data issues: for marketing to be truly data-driven, it is important to choose relevant, high-quality insights. Specialists must keep track of duplicates and conflicting information and ensure the completeness of the data.
- Invasiveness issues: today, personal information is a vulnerable asset in the marketplace. Even if a person is willing to share data, he must know what you plan to do with these insights and what benefits they will bring. Firms must collect information legally and use it responsibly.
Sometimes specialists are so focused on information that they forget why they need it. Marketers’ efforts should be focused on establishing real human connections and not just collecting and analyzing data points to increase profits. Use the collected information to understand the real people behind the data set.
Popular Data-Driven Marketing Tactics
Data-driven marketing is a relatively new concept, but it is rapidly gaining traction as more firms see value in making informed decisions. Businesses can implement several data-based marketing plans to improve their performance. Consider the most popular options for using such strategies.
Control of interaction with the platform
Each site provides different options to ask questions, leave comments, or share their contact details. All interactions provide valuable data if handled correctly. The most popular analytic applications are:
- The shopping experience includes user behavior, such as clicks on a page, time spent on the site, navigation data, etc. These insights allow you to improve your home page to ensure user retention.
- Content effectiveness: different content formats, e.g., white papers, webinars, and blogs, have various purposes. You can increase user engagement by analyzing the styles and questions that users are most interested in.
Without professional processing, data may be ineffective even in a well-structured site. Professionals should add different data control tools to make the most of each piece of information.
Using predictive analytics to build your ideal customer
As the amount of data a firm collects increases, so does the potential to use predictive analytics to profile the perfect buyer. Organizations can target marketing efforts more accurately and identify potential customers by adding data-backed marketing strategies.
When determining the image of the ideal client, you should consider demographic and psychographic factors and purchase histories. After analyzing such aspects, firms can create a targeted promotion that will lead to a conversion.
Gathering opinions and feedback
Maintaining a good reputation and understanding the target audience creates valuable company data. All that is required of you is to control who talks about your organization and what exactly. Listening and monitoring social networks allow you to discover people’s opinions about your company, products, competitors’ offers, etc.
It is crucial for expanding a company’s online presence and improving customer support, as this kind of monitoring allows you to determine the mood of users in real-time, so you can understand if the number of users talking about you or the attitude of customers is changing. In essence, it is an alert system that quickly informs about any changes in reputation.
Individual campaigns via email
Let’s face it; if a user is looking for a car, there’s no reason why you should show them a bike. Personalizing email marketing makes it as effective as possible.
Information can strongly impact email marketing, as a company can send offers for discounts, order-related products, and abandoned carts after the first purchase.
Overcoming disagreements between the marketing department and the sales team
When a company fails to achieve its profit targets, marketing, and sales often shift the blame. Marketers claim they found quality leads, but salespeople lost them, while sales staff claim that potential customers were initially unpromising. To solve this problem, companies can use dialogue analysis software.
With data analytics, marketers can gauge the number and quality of calls and then share that data with the sales team to increase transparency and accountability.
How to Implement Your Data-Driven Marketing Strategy
Implementing a data-ruled marketing plan can be tricky. The problems are exacerbated if you miss essential milestones, forcing specialists to go back to basics and increasing project implementation time. Before developing a company promotion strategy, study the process’s main steps and ensure you have enough resources to complete each operation.
Use the data you have to set goals
It is vital to set clear goals from the very beginning of the project implementation to understand what you want to achieve and develop an impeccable plan to achieve the goals.When setting aims, it is important to consider current trends in the development of companies; for example, on the Сryptoflies website, you can learn more about cryptocurrency, the metaverse, and Web3. Take an objective look at your firm’s existing data, determine what is missing, and whether you can fill in those gaps. Most often, marketers use the following data:
- conversion rate,
- average success rate,
- duration of the sales cycle,
- average transaction amount,
- promoter score.
Not all of the listed data is needed for your specific purposes. The algorithm for collecting information is to find insights that will be useful for your business. Once you have the necessary information, you can make your models.
Creating and adding models
Models are specific methods of using data to achieve goals. There are a large number of different ways to describe a task; consider the most common options:
- multidimensional data models,
- object-oriented models,
- hierarchical models.
These interactions with data determine how your information is organized and the relationships between individual components.
After creating the model and examining the inferences from the data, you can begin to act. You can optimize and transform processes by making changes based on the information you collect and ensuring that your operations are as profitable as possible.
We recommend focusing on marketing automation to unload specialists’ routine activities. This solution provides several advantages:
- Optimal lead management and conversion rate growth.
- Maximum consistency and interaction between marketing and sales teams.
- The ability to scale processes that develop in parallel with your business.
- Increasing efficiency and reducing personnel costs in the company.
One of the most popular marketing and sales automation options is adding chatbots. Interactions with virtual assistants can be personalized based on what the platform has learned about customers from its internal and external sources.
Measuring and tracking progress
Finally, you must develop a procedure for monitoring the effectiveness of your campaign. It will help to analyze the actions better and inform all stakeholders about the progress.
Data-driven marketing creates value for the company, marketers, and customers. According to research by Deloitte, this business promotion tactic can increase sales by about 15% and double the return on investment in advertising campaigns. Specialists can enhance campaigns through improved targeting, monitoring customer sentiment on various gadgets, and choosing the optimal interaction model.
Marketers can also find and optimize actionable client groups. With such groups, they can apply insights to create a personalized customer experience and improve engagement, conversion, and retention. The target audience benefits from data-based marketing through an experience that only gives them positive impressions. They get what they want, where and when it matters.