Marketers have been in back-to-back crisis meetings over the past few years. Worn solutions hit a dead end — a long time ago. Consumption patterns are erratic and brand loyalty is fluid like never before. For these and other problems plaguing the marketing department, experts advocate a solution: data-driven marketing.
What is Data Driven Marketing? Why is this important?
This involves using customer information to optimize commercial advertising and marketing communications. In data-driven marketing, marketers collect consumer data and run it through data analytics tools to predict what shoppers need, why, where, and how.
Data-driven marketing is used by many brands to better segment their audiences. When brands have the right data, they can identify which consumers are engaging with their marketing efforts, identify the best channels, and hone in on the times of day when customers are most receptive.
Additionally, with data-driven marketing techniques like A/B/n testing, brands can test twin campaigns and choose one with the best reception among customers. This saves companies a lot of money in the long run and guarantees a better return on investment.
A key benefit of data-driven digital marketing is personalization. Brands can now create personalized marketing strategies using data gathered from customer interactions. The end goal is to maximize return per advertising dollar.
When companies collect and analyze customer data, they can uncover trends and customer needs. The new information then helps to determine the type of advertising and sales methods to employ.
OTT platforms are a daily example of this. To bring more movies, movies, music videos and videos to their subscribers, Over The Top media platforms such as Netflix and YouTube continuously analyze the preferences of their customers.
Data-driven marketing also played an important role in the success of The Lion King campaign. In November 2018, more than 2M mentions on social networks as well as more than 5,000 mentions in the media revealed the importance of celebrating the return of James Earl Jones!
How to build a data-driven marketing strategy?
The challenges of data-driven digital marketing are also numerous. Many conditions must be met for such a strategy to work effectively. The most crucial step is to build a foolproof data-driven marketing strategy. To do this, you need to map your sales funnel, find the right data-driven solutions, and build a skilled team, including professionals who specialize in audience amplification or predictive analytics. .
The main actions in designing a data-driven marketing plan are:
- Find your target audience. Identify your target market in this section of the project. You will need to specify demographic information such as location, age, gender, and interests of your target audience.
- Set goals. You can choose from many potential goals, such as increasing sales, brand awareness, driving traffic to your website, or improving customer satisfaction.
- Collect data. You can get data from your CRM, sales history, messaging apps, and customer survey results. If you are looking for a tool to unify profiles and store customer data in one place, pay attention to a Customer Data Platform (CDP).
- Analyze data. According to Forbes, almost 36% of companies are not fully utilizing their big data and 47% plan to introduce a data analytics tool in the future. You must analyze the data collected to identify the answers to your research questions.
- Implement ideas. After the data-driven analysis follows the implementation. This step uses insights from digital marketing data to optimize the customer journey. The results of the study show that 80% of respondents prefer companies that offer personalized experiences. This is possible through data-driven content distributed across different channels.
- Analyze the results. The data-driven approach requires regular and rigorous measurement of results. Tracking your customers’ behaviors is the only way to adapt your strategy to their needs. Remember to continue testing after reviewing early results and fine-tuning your campaign approach as needed.
Data-driven marketing metrics
Don’t fly blind. For your company’s data-driven strategy to succeed, it is essential to select key performance indicators (KPIs). These are the crucial data-driven analytics metrics that warrant your valuable attention, effort, and finances as a marketer.
Your business has many opportunities to convert traffic (website visitors) into customers, so measuring your traffic month-over-month is essential. Setting realistic conversion goals can help you achieve them.
What is the source of your site visitors? Your website may receive traffic from a variety of sources, including organic keywords, direct traffic, social media links, or emails. Focus your efforts on your biggest source of traffic.
- Return on investment (ROI)
Simply put, calculating your ROI comes down to answering this question: Did we make a profit after all our marketing spend? You can calculate ROI by subtracting expenses from earnings.
- Customer acquisition costs (CAC)
You can measure how much money your strategy costs per customer to convert. Customer acquisition costs can silently destroy your business if they are too high.
- Customer Lifetime Value (LTV)
LTV represents a customer’s lifetime ability to purchase your product. Therefore, it can be a powerful metric to help you decide how much money to invest in customer acquisition – if you spend more than you earn, you will lose money.
A company’s customer churn is the number of customers who leave the company. This metric is also known as the customer churn rate. It is essential for digital marketers to track this metric as it is a litmus test of marketing efforts.
- Customer Satisfaction (SATC)
Customer satisfaction is a measure that shows how satisfied customers are with a company’s products or services. With this data at their fingertips, marketers can improve customer experiences or provide insights to product design teams. There is nothing better to know if the customer is satisfied with your product than to ask him. This is why it is very important to collect customer feedback correctly.
A data-driven marketing approach can lead to extraordinary business growth. Big data is captured, marketing metrics are used, data science and analytics are leveraged. Success soon follows!
Originally posted here.