Companies have been compiling data about their users and target audiences for decades. Now businesses have access to detailed data, powerful analytics, and robust marketing tools to build a comprehensive, data-driven marketing engine.
Businesses Use Data-Driven Marketing to Grow
Data gives your business a competitive edge. Advanced insights-driven businesses (IDBs) are 8.5 times more likely to report revenue growth of at least 20%. Forrester cites these figures in comparison to businesses just becoming aware of data-driven marketing, or not at all. IDBs find success by leveraging data to enhance product development and the customer experience.
Case Study: Leveraging Data for Personalization
A sporting goods retailer was looking to improve conversion rates and digital revenue. Leveraging their customer data, the business was able to understand customer motivations and interests, define goals for improving the customer experience, and outline more effective business strategies for the future.
This data and personalization case study shows how a retailer worked with Object Edge to:
- Identify customer intent to purchase in real-time.
- Research key behavior traits of specific customer groups.
- Create product bundles.
- Define competitive combinations of products and prices.
Using programs like Google Analytics, Know Your Customer for verification, AWS for Stream Processing, and A/B testing with Optimizely, the retailer increased conversion rates by 28%. They also enhanced technology, business practices, and programs to gain more information about their target market.
Dealing with the Inevitable Data Decay
Your data’s value is tied to its accuracy. Over time, your data will depreciate or lose its value–with growing inaccuracies in information like contact addresses or phone numbers. Keeping your data accurate and valuable is an ongoing exercise. Additionally, your business will need to continue to evaluate privacy standards to ensure compliance and accuracy.
Experts like Forrester advise businesses to continue increasing both first-party and zero-party data, gaining information directly from the client or targeted audience rather than wasting time speculating. Businesses are able to hedge their bets by accessing and leveraging data (with consent) maintained in customer relationship management (CRM) systems, through SMS marketing, contact capture at point of sale, and data-capture focused advertising.
Building a Capable Martech Stack
In order to best capture, store, and leverage data, you’ll need a strong martech stack, including analytics, CRM, CMS, marketing automation, advertising, and social media tools. Navigating the sea of available marketing technology can be a tall task, especially as the number of products continues to multiply. Research shows that the number of solutions have increased almost 25% since 2022. While some vendors may disappear, exponentially more enter the market with new solutions. Every marketer needs the proper technology in that race to move ahead of the competition and stay there.
Begin the process by evaluating what your business already has, and recognizing what is missing. Some platforms may be outdated or simply no longer in use at work; in fact marketing leaders state that most companies are only using 58% of their martech potential. Adding technology, improving marketing systems, and integrating data requires encouragement and training for everyone involved, but that should be an ongoing process to ensure growth.
“To drive your marketing campaigns, you have to gather data from various sources, regardless of whether they are social media channels, ERP arrangements, CRM frameworks, cloud servers, or even Excel documents on a partner’s workstation,” states Martechcube. “It isn’t unprecedented for marketing departments or organizations to utilize around 50 unique technologies consistently to monitor their clients’ activities and their buying journey.”
Using Data to Create a Personalized Customer Experience
“Data-driven insights enable organizations to enhance and personalize the customer experience.” - Gartner
New sectors continue to strengthen in the post-pandemic era, making it clear that marketing efforts must be more flexible than ever to match shifting trends and consumer demand. “Data-driven marketing” is defined by Gartner as “the use of data acquired through customer interactions and third parties to gain insight on customer motivations, preferences and behaviors. Data-driven insights enable organizations to enhance and personalize the customer experience.”
While some consumers may express annoyance at the perception of having their minds read with advanced analytics and targeted ads, data shows that most individuals are actually more likely to be irritated at a lack of personalization.
McKinsey reports, “thanks to online pioneers, customers have grown to expect and desire personalized experiences: a survey of 1,000 US adults found that the vast majority of respondents (80 percent) want personalization from retailers. Personalization can even be called a ‘hygiene factor’: customers take it for granted, but if a retailer gets it wrong, customers may depart for a competitor.”
Gaining the proper insight requires a plan, however, including the following:
- Understanding customer behavior and leveraging data for better segmentation, customization, personalization, and optimization.
- Streamlining product data in terms of pricing, upselling and cross-selling, seasonal tracking, and product bundling.
- Understanding seasonality and inventory information to decide on discounts and sell slow-moving products faster.
- Using website data to uncover customer behavior (number of visits, time spent on site, bounce rates, conversion rates). This information can be used to improve experience and design, uncover long-tail content and products, and find bugs/limitations that impact conversion/AOV.
- Finding out more about customer engagement and sentiments shared on social media. This is a great way to leverage new trends, as well as terms that are currently resonating. Align marketing campaigns with customer insights and testimonials.
Businesses must continue to map out and study the digital customer journey to see where they might be losing people, as well as engagement and conversion. Data-driven marketing is a win for everyone when the time is right–but that all comes down to finding the perfect equilibrium between putting personalized data in front of consumers and establishing trust.
Schedule a consultative call now to start ramping up your data-driven marketing machine.