Does the phrase data-driven marketing strategy ring a bell? Well, the modern marketing world offers more customer insights than ever before, so hearing this phrase is more than common. Gaining a better view of customers’ behaviors, desires, and preferences is what data-driven marketing is about.
In this article, we will break down the definition of data-driven marketing, its benefits, and some of the best strategies. Let’s dive into the world of customized messaging and experiences that convey the highest imaginable return on investment (ROI).
Table of Contents
- What is Data-Driven Marketing?
- What are the Benefits of Data-Driven Marketing?
- Strategy #1: Use Data in Marketing Campaigns
- Strategy #2: Use the Right Data to Measure Progress
- Strategy #3: Understand Who’s Talking About You
- Strategy #4: Offer your Customers a Personalized Experience
- Strategy #5: Take Advantage of Predictive Analytics
What is Data-Driven Marketing?
Data-driven marketing is the process of optimizing brand communications based on customer insights. A data-driven marketing strategy starts with reviewing the way customer behavior has changed over the years, alongside technology that enables you to gather and analyze huge quantities of customer data and marketing trends to industry news. More precisely, a data-driven marketing strategy applies the most recent data analytics prospects to identify the most beneficial media buys, while designing creative ways of raising awareness about products and services.
Data-driven marketers use customer insights to foresee their needs, ambitions, and future actions. This kind of data helps marketers create custom-made marketing strategies for the highest achievable return on investment (ROI).
Simply put, a data-driven marketing strategy follows the process of creating a campaign based on actionable insights as opposed to presumptions solely. While this practice was once rare, nowadays the majority of social media networks and increased customer interactions have turned data management and analysis into a vital CRM process for the industries involved in the marketing field.
What are the Benefits of Data-Driven Marketing?
A data-driven content marketing strategy gives marketers the ability to increase the chances of their target audience clicking on their ads, participating in their webinars, reading their blog posts, or performing any kind of activity that encourages conversion rate goals. Maintaining a great customer relationship is crucial.
Let’s check them out!
Benefit #1: It allows you to make better decisions
With the help of customer data companies can make better decisions instead of relying on assumptions. Strategic digital marketing decisions should be at the core of any marketing campaign, as you can use the information about your potential or existing audience to communicate and carry out customizable media and creative strategies. For instance, customer data like demographics, CLV, and other performance metrics are crucial to making the right marketing decisions.
Targeting the right audience, at the right time, on the right media channels, and of course, with the appropriate marketing message is the hidden gem you can uncover. On that note, 2 out of 3 marketers highlight that decisions based on third-party data analysis are preferable to making decisions according to gut instinct. To be more specific, data analysis allows marketers to choose based on actual use cases instead of assumptions and theories. Although, a data-driven marketing strategy does not take into consideration the emotional applications that influence a consumer’s purchasing decisions. Marketers and teams must evaluate big data within a framework that takes into account rational and emotional decision-making to be sure that there is balance in their campaigns.
Benefit #2: It helps you reach the right audience
With the right data, such as traffic sources, demographics, behaviors, and more, marketers can discover their target group audience and approach them accordingly. Determining your audience is a critical step for driving the right traffic to your online business and increasing sales; who they are, what they believe in, and the way they use each social channel during various stages of their purchasing decision making, these are the questions you need to answer while defining your target audience. Understanding their way of thinking through data analysis helps your brand to build a more concrete online presence and raise awareness around your products.
In addition, defining your target audience will help you create a consistent brand voice that speaks to your audience. A target group analysis based on valuable data allows you to direct your digital marketing strategy in the right direction and ensures cohesion in your communication, by building powerful relations with customers.
Benefit #3: It offers valuable customer insights
Being aware of where your customers spend most of their time online allows you to reach them effectively, whether this concerns social media channels or websites. Doing so allows you to create more personalized and steady connections with your audience. These customer insights are used to offer a more personalized customer experience, target clear-cut marketing segments, approach new customers, and measure and upgrade strategies in real-time.
By having a comprehensive look into consumers’ habits and preferences, marketers can create and promote campaigns that match the target audience’s perception, which not only increases the return on investment (ROI) but reinforces the relationship between a brand and its followers. A more personalized customer experience can improve brand perception and as a result, boost brand awareness. The goal is to know what the customer wants before they even ask for it, through higher and more efficient engagement every step of the way.
Strategy #1: Use Data in Marketing Campaigns
Creating a successful marketing campaign requires the right data. Let’s assume you are planning on launching a new product, you will need attribution data that corresponds to customer behavior and their spending habits, such as audience demographics, customer behaviors, and psychographic data.
More general data is also useful, for instance, industry benchmarks, PPC data, click-through and retention rates, and ROAS. All of them need to be taken into account to design a successful marketing campaign.
After identifying your data objectives, you need to gather the data and select the right information for your campaign, based on the objectives you set up.
Attribution data allows you to get a peek into users’ browsing habits, social media activity, online purchase behavior, and metrics assist you in focusing your marketing efforts on what is proven to work. That means collecting as much information as possible about your target audience will help create a campaign that appeals to your customers’ needs and desires. Data will lead your marketing campaign to success.
On that matter, data-driven marketing stories have a way of capturing people’s attention and interest. Data visualization allows content marketers and marketing teams to discover useful insights and to narrate stories in a way that is visually engaging and fascinating.
Implementing data-driven marketing strategies instantly adds value to your brand’s online presence, as you offer to your audience the kind of content they are looking for and so your credibility and expertise in your field start to establish themselves. Simultaneously, big data can help you bring to light the newest trends and insights, providing more ideas and topics for your content marketing strategy. Viewing something with a fresh perspective is always helpful.
Collecting as much information as you can is an important step into building the right campaign that will suit your customer’s needs and make you stand out from your competitors. Original insights and data-driven content that is relevant to your audience is an excellent way for brands to establish transparency and enhance customer loyalty.
Strategy #2: Use the Right Data to Measure Progress
Without the use of big data, brands can’t measure their progress and understand whether a campaign was successful or not. In the past, it was complicated to track and monitor return on investment (ROI) and so understand the impact of a campaign. Data has allowed marketers to monitor current campaigns, measure outcomes, and interpret their impact. As a result, this allows them to optimize their marketing efforts and advance performance regularly.
Measuring results and improving strategies in real-time is an asset of data-driven marketing. It is essential to keep testing and measuring, to ensure your service meets and succeeds in customer needs.
Let’s be more specific. One example that helps comprehend the concept of data measurement, is that your completion rate data can reveal the phase in your customer journey, such as when exactly are customers dropping out. Another way of interpreting data-driven results is segmenting user data according to the characteristics of users’ groups. For instance, you could identify if customers of a specific age group perceive the service as more difficult to complete than others.
Analyzing your data results will allow you to get a comprehensive look into what’s working and what’s not, what you should change, how others perceive your brand, and how to approach existing and potential customers. Offering your audience everything they need and want to see from a brand is one step away from increasing customer loyalty and customer acquisition. This could turn into your competitive advantage.
What kind of data should marketers measure? Well, data sources like ad spend, ROAS, traffic, sales, conversion rates, and more, are all vital insights that marketers need to keep track of. Analyzing vast amounts of data offers a 360-degree audience view, which allows a profound understanding of customer behavior and what leads up to purchasing decisions, as well as leverage of real-time data in cloud computing surroundings. That way a brand’s awareness will be highly benefited and that highlights the importance of a data-driven marketing strategy.
Strategy #3: Understand Who’s Talking About You
Maintaining a good online reputation, as well as understanding who your audience is, offers valuable brand insights. What you need to do is monitor who is talking about your brand online and what exactly they are saying. Tactics like social listening and social media monitoring allow you to identify and assess what is being said about your company, products, competitors, and in general about your brand on the internet.
This is a great way to protect your brand’s online presence and enhance your customer support, as it helps you to keep track of sentiment on a real–time basis, so you can be aware immediately if there’s an important change in the number of people talking about you or the attitude behind their words. Consider it as a warning system that quickly informs you about positive and negative changes in the way users perceive your brand on the web.
Data is the key reference for knowing what your audience is saying. If you pay attention to your customers’ needs, you should pay attention to the data you collect and the information they carry. Through successful data, you can understand and engage with your customers, track your competitors’ actions, measure your product’s success, and avoid crises before they even happen. Social listening makes it possible to reveal questions and discussions about your industry on social media channels. These are all potential opportunities to connect and present your brand or share your expertise. Think of marketing data derived from online conversations as a way of developing relationships with a potential audience in your industry which you can turn into relations for social selling. When it comes to making a purchasing decision you should be the brand defined as the best source of information.
A business can pinpoint opportunities for collaboration as monitoring online social conversations related to your field will make clear who the important creators and thought leaders are. These people are important as they can influence the sentiment of your audience.
On that account, Mentionlytics is an excellent example of a social media monitoring, listening, and analytics tool that can help with all of the above in an easy–to–use way, with a variety of data dashboards.
Strategy #4: Offer your Customers a Personalized Experience
Tailoring content and online interactions based on demographics, purchasing decisions, online activities, and other important information about your audience have been proven one of the best ways to attract their attention. When the information is based on the right data sources, a personalized customer experience is a one-way road.
Delivering a more personalized customer experience makes your customers feel unique and that you care for each one of them individually. Turning customer experience into a personalized way of serving your audience can improve customer retention, fulfill customer expectations, and increase customer loyalty. This way, a customer can feel more connected to your brand, while leaving them with a sense of satisfaction that their needs were fulfilled according to tailor–made solutions.
The real question is how to optimize and deliver a personalized experience for your customers? Well, the first action you should take is to get to know your customers; that means building strong relationships with them and interacting with them daily. A productive conversation can only meet your customers’ expectations. Of course, that assumes you are available for them, you have the time and the willingness to maintain constant communication through social media channels and correspond with the right message. Instant responses always leave a positive impression.
Additionally, offer your customers a variety of options to choose from, such as more guidance, or more customer support options that will assist them when they are browsing through several marketing channels, and of course ask for feedback and reviews. A business must be aware of what needs improvement and how customers perceive the brand’s image. That’s the route you have to follow to build meaningful relationships.
Let’s take for example Spotify Wrapped; a year-end that ranks top artists, songs, albums, and podcasts of the year, both for individual listeners and Spotify’s massed user base. The year-in-review playlist and slideshow optimize and deliver various listening data points from last year, including statistics like how many minutes people spent listening to music, popular artists and songs, and how close someone is to be a superfan. Spotify Wrapped offers artists a brief look at the number of streams they gained, hours people listened, the total of listeners, and their location for the year.
This initiative has been a hit for Spotify, as the downloads of the app increased by 21% in the first week of December 2020, with over 90 million users engaged. So, Spotify managed to optimize and turn data into something unique and cool for their users, and that’s why the brand’s awareness is constantly increasing.
Strategy #5: Take Advantage of Predictive Analytics
Another way data can be beneficial is that it can help predict future outcomes. According to SAS “predictive analytics is the use of data, statistical algorithms and machine learning techniques to identify the likelihood of future outcomes based on historical data”. Brands can glimpse into what types of customers are more likely to convert, what marketing actions are more likely to succeed, as well as how industry trends can impact marketing efforts. Predictive analytics are marketing tools with a variety of possibilities.
The goal is to go further from knowing what happened to provide the best estimation of what will happen in the future. The main reason for the extensive use of predictive analytics is that they allow growing volumes, types, and examples of data, they attract more interest in using data to collect valuable insights, and the current economic situation and the need for competitive differentiation. In a nutshell, companies use predictive analytics to empower their bottom line and competitive advantage.
With predictive analytics marketers and marketing teams can uncover consumers’ reactions when creating a new campaign. They can use shifts in demographics to figure out if the current mix of products will attract customers into forming a purchase decision. Meanwhile, looking back at metrics from past events assists in preventing future crises, and repeating past actions and mistakes.
There are many ways marketers can benefit from predictive analytics, such as predicting results when there are no other answers available, as well as identifying the prospect of success or failure around a product before its launching.
Data collection is the core element for businesses, both big and small, as companies gather data every step of the customer’s journey, tracking when, what, how much, and how regularly customers make purchases. Tracking customer defections, complaints, late payments, credit failures, and scam is also part of data analysis.
To be more specific, predictive analytics gives companies and marketers an advantage by tracking meaningful patterns and designing models that predict the likelihood of a future event. For instance, based on previous customer behavior and the behavior of other customers with matching characteristics. Numerous organizations use predictive analytics to reduce risk, optimize actions, boost effectiveness, and establish strategies that lead up to competitive advantage, by analyzing the behavior of individuals, machinery, or other entities.
Data sets allow marketers to assess upcoming probabilities with an acceptable level of trustworthiness and of course, this kind of CRM process varies by industry, area of expertise, and organizational maturity.
Now Over to You
Data-driven marketing strategy is a way of optimizing brand communications according to customer information. Customer insights have the power to turn general-based marketing into a personalized way of communication between businesses and customers. Incorporating data into marketing strategies and learning more about your customers will have an edge over competitors throughout the years to come, as well as enhance brand loyalty and affinity.
Of course, you need to keep track of your brand’s presence, by monitoring mentions about the brand itself, its products, and competitors on the entire web. If you want to know more about brand monitoring and social listening, book a demo with Mentionlytics, so you can have better use of your data.