Marketing strategies help your business grow. To make sure your marketing team is contributing to your business in the best possible way it can, companies need a strategy that is focused on action and data. A data-driven marketing strategy can make all the strength and weaknesses of your business apparent. This means that you will be able to make strategic decisions that will help your company’s marketing efforts become more successful.
What is Data-Driven Marketing?
Most companies already have products and services that they offer, and for them the main goal is development and growth. This is done with the help of the data they get from their interactions with the consumers, along with the data they receive from tracking their competitor’s performance.
Currently, we’re in the age of Big Data, and all the companies who do not store, understand or retrieve and analyse customer interactions will most probably fail at their venture.
So what exactly is data-driven marketing?
It is being recognized as the future of how marketers see and analyze the data they receive. Data-driven marketing refers to the strategies that are created based on insights pulled from analyzing big data which is collected through customer interactions and engagements so that the marketers can form predictions about their future behaviours.
The process involves having an understanding of the data which you have already, the data you will get in the future, as well as the knowledge of how to organize, analyze, and apply the given data to improve marketing efforts of the company. The main reason why companies use data-driven marketing is to enhance and personalize customer experience.
What are the Benefits of Data-Driven Marketing?
The benefits of data-driven marketing is twofold. Businesses as well as consumers benefit from these strategies when they are implemented successfully. Some of the benefits are as follows:
With the help of data-driven marketing, businesses can create personalized campaigns that are made by gaining a deeper understanding of the customer’s profile which will help in conversion of leads. The essential aspect of conveying the right message to the right audience gets covered.
Marketers now have access to a wealth of information on their database. It becomes easier to separate and then group their target audience based on their preferences, location, and more factors because the information is available and all they have to do is go through it.
Multiple Network Reach
With data-driven marketing, it is now possible for companies to access multiple networks based on the consumer’s preferred platform and drive their campaigns beyond just email. Using automation tools, marketers can distribute advertising campaigns across various channels, and because it is automated the message delivered will be consistent, aligned and reaches the customer at the right place at the right time.
Improved Customer Experience
When you use target specific surveys to measure the customer satisfaction using data-driven marketing, it creates an environment that is solely focused on improving consumer experience. They can pinpoint various points of improvement and what the customers respond to vs. what they do not approve of.
Reduced Product Failure Rates
Companies get a better understanding of what their target audience’s needs and requirements are when they use strategies that are data-driven. This means that they can create their product or service tailored around solving the consumer’s problem, which leads to a reduction in the failure rates of the product because they are made with keeping the consumer in mind.
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What are the Challenges Faced by Data-Driven Marketing?
The most common problems faced by marketers who use data-driven marketing strategies are as follows:
- Attract the right type of employees that have the specific skill set to implement efficient data-driven marketing strategies
- Obtaining data that is integrated and of high quality
- Committing to the created strategy
- Getting a unified customer view with successful integration
What are Some Examples of Data-Driven Marketing?
Using data-driven marketing strategies, find out who has interacted with your company’s website or application. Whether it is showing interest on your product pages or making purchases, it is possible to direct your advertising or marketing strategies at them so that they develop further interest in your business.
Creating Two-Way Communication Channels
Social media has created a platform where consumers and businesses can freely interact with each other. Use the different tools created to target your advertisements to your potential customers and open a dialogue. Creating a two-way communication channel across various social media platforms will help marketers and companies get valuable information that goes into the existing database.
Optimization of Paid Searches
Use various analytics tools to find out your company’s preferred customers and what keywords they search for. Create ads targeting those keywords and also consider what your competitors are targeting as well. Use this data to position your company on top of the search results to improve the quantity as well as the quality of the traffic being driven to your website.
Targeted Email Campaigns
Use data-driven marketing as a part of your business’s email marketing strategy by grouping together target audiences to create automated and personalized messages for your existing and potential customers.
What are the Steps Involved in Creating a Data-Driven Marketing Strategy?
Have a Clear Definition of Goals and Objectives
Organizations receive, store and analyze data using the same set of tools and strategies. The important aspect here is the difference in the goals and targets that each company wants to achieve. It could be a brand launch, or to drive more sales, or to double the subscriptions, but what is important is that goals and targets are different. In some cases, it may be launching of the new brand, sometimes it drives more sales and branding, or it could be to double subscriptions for a service.
A data driven marketing strategy ensures that the data collected is credible, trustworthy and actionable in line with the company’s goals and vision.
Create a Plan and Commit to It
After conducting multiple rounds of data analysis and gathering all consumer data, marketing experts work to create strategies that would help the company the most. A lot of times these strategies do not get implemented successfully. Proper implementation of the data driven strategies is crucial in ensuring the success of your marketing campaigns and in generating ROI for the company.
Automate: Have a Strong Automation Platform
Business operations just get more and more complex with time – handling taxation, sales, inventory, multi-locational movement of goods and tracking them, are a few of the processes that need to be managed. By investing in a good CRM and ERP platform, it can act as a backbone for your company.
With CRM companies can track customer movements which lets the companies understand the customers buying patterns, behaviour, lifestyle and other factors. This helps companies develop new products. An ERP system will help the company in integrating many functions of the company from production, inventory control, marketing, sales, distribution, finance, HR. This enables better decision making.
Keep a Data Management Platform Ready
Getting relevant data to the marketers requires a data management platform (DMP) at the backend of the company that works tirelessly. The platform is capable of getting data from many places, identifying the segments to help target messages as well as give instructions to media associates which would help them in positioning the advertisements and the company on many platforms.
Invest in a Strong Team
The first step before you start to collect, analyze and use any consumer data to create your data driven strategy, is to build the right team that will deliver the strategy.
The team should ideally have people from different departments across the company that will create an effective and cross-disciplinary data-driven marketing strategy. The ideal data-driven marketing strategy team will will have people who want to collaborate, share their ideas and are willing to go beyond their expertise to work towards their main objective.
Keep Wholesome Consumer Experience a Priority
The main purpose of a data driven marketing strategy is to give existing consumers a wholesome experience. This includes customers receiving value for past purchases and loyalty programs for them. The data collected about the consumer should be used to give the customer better offerings in the future.
Involve All Departments in the Process
Big data is a combination of technology, marketing and advertising teams. The IT teams gain some prominence because the entire process of capturing, storing, structuring and presenting reports fall under the IT sector. But the job of analyzing the data and using it to apply into the market is the marketer’s job. The success and failure of the product or service, the customer satisfaction aspect are all the marketing team’s responsibility. Implementing new technologies and processes is not enough. Companies also have to make an assessment of the impact of their data driven marketing strategy.
Observe the Competition
The marketer should know what the company’s competition is up to and inculcate their best practices into their marketing strategy that are already proven in the market. The concept of big data includes handling complexities with respect to consumer data and its management for the future. This is why it is important to merge their efforts.
The data collected needs to be continuously tested and manipulated for use. The goal is to gather valuable data as soon as possible and as efficiently as possible to conduct new experiments. The more data you have to test, the more informed your marketing efforts will be.