The Problem with Data: Reframing Your Mindset Around Data-Driven Marketing
The thought of “Big Data” or “Data Analysis” can be overwhelming. However, using data to make more informed marketing decisions does not have to be hard. The use of data in your marketing is the difference between increased ROI and financial waste.
Start with the data you have readily available to you. As you begin to see better results from your marketing efforts, reinvest to develop more sophisticated systems.
You may ask, why should I be concerned with data anyway?... Good question, below are three reasons data matters.
1. Improve decision making The use of data allows businesses to make better marketing decisions. Knowing which products produce the most sales or understanding seasonality in your business can make a significant impact on overall profitability. The ability to leverage past learnings through data collected in a previous campaign can be the difference between lackluster and doorbuster sales.
2. Connect with target audiences Understanding your target audience is a whole thing; in fact, it deserves its own separate article. However, for now, it’s worth noting that with the collection of customer data you will gain a better understanding of your best and most profitable customers, as well as the ability to better connect with them. Use customer data to build meaningful relationships with your audience, add more value to their lives, and create customer loyalty. Then, once you have it down to a science, create look-alike models to reach new markets.
3. Track return on investment ROI is the most critical data point when deciding if future action is worth taking. The only way to know for sure which activities generate revenue and profits is by tracking sales against the cost of those activities. All of this information becomes data that you may leverage when planning future marketing campaigns.
OK, so now you may be wondering, where do you find the data?... Another good question, let’s start with you what you have.
Current Customer Database Your existing customer database is a wealth of valuable information that can inform future marketing decisions. If you are an e-commerce company, you probably have shipping information, which tells you where your customers are located. You may also have information regarding the gender of your customers. Your database may say to you that your products are popular among women who live in South Dakota; this is very specific information you can use to create messaging that resonates with your audience and drive additional sales.
Google Analytics If you don’t have Google Analytics tracking code installed on your website, stop reading this right now and get it done. Google Analytics tracks and provides a tremendous amount of information beyond website traffic and basic demographics. Two of my favorite tools within Google Analytics are the ‘Affinity Categories’ and ‘Behavior Flow.’ Affinity Categories gives you more information about the behavior of your website visitors and their interest. Behavior Flow allows you to see your customer path on your website. With this tool, you can identify how people are navigating your site and where the majority of visitors exit. This information allows you to begin to develop strategies to increase engagement on your website and decrease drop off.
There are many other data sources that you can utilize to develop a more sophisticated data analysis organization within your company. However, to prevent analysis paralysis, start where you are right now. Use the data that you have as proof of concept and to add to your data collection. As your business grows, so will the data that is accessible to you. You may also invest in second or third party data sources to enhance what you have.
When it’s all said and done, according to a recent study by Google, companies who implement a data-driven marketing strategy may see up to a 20% increase in revenue and a 30% increase in efficiency. So don’t just take it from me. The numbers speak for themselves. Data-driven marketing is the present and the future. Don’t be left behind.
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