All meaningful, deep, long-lasting relationships are dependent on communication. The more two people communicate, the more they get to know one another, and the more intimate they become. With intimacy comes trust, loyalty, and sometimes, even love. This is as true for a brand and its most loyal customers as it is for two individuals. Of course, the method may be different in those two examples (or maybe it isn’t, and I’ve just been out of the dating scene for too long), but the emotional path traveled is relatively similar. So, in honor of Valentine’s Day, and of course with my deepest and most sincere apologies to Sammy Fain and Paul Francis Webster, here are my thoughts on how data-driven marketing is a many-splendored thing.
I’m not going to wax on about why you should care about data-driven marketing. If a direct marketing strategy that results in higher response rates, better-quality leads, more relevant offers, better targeted media plans, improved revenue, more loyal customers, and a 20% ROI increase doesn’t do it for you, then please, by all means, continue your search for ‘discount roses delivered today.’
For those of you that are still with me, let me give you my thoughts on why data-driven marketing is so many-splendored.
Communication and Data are Key to Strong Relationships
The exchange of information between the two parties, and the frequency with which those exchanges take place, is instrumental in the growth and complexity of the relationship. In other words, the use of information is vital to the on-going communication in any relationship, or in ‘business speak,’ data is key to any successful marketing plan or campaign when the objective is to acquire new customers and turn them into loyal advocates.
Let’s start with the data itself. In order to be effective as a data-driven marketer, all of your data has to be in one place, and it has to be the right data. Most organizations have siloed data due to siloed departments, so by using a single data repository (fed by as many customer behaviors as possible from the data collected by marketing, sales, customer service, and accounting), your organization will be more unified and thus more effective. Often, companies already have the data they need to become data-driven, but executives might not fully understand the potential value of the data they possess. Marketing can be the driving force to help companies focus on solving the business problems at hand, by demonstrating how data can be used to improve the effectiveness of customer communications.
Predictive Models and Personalization Give Consumers What They Want
Data is essential, but being able to predict and optimize the outcomes of your communications and campaigns is critical. Building predictive models generates faster results because it establishes a foundation in data relationships. The main concern of most C-Level executives is that they don’t trust (read: understand) data-based models, and thus, tend to steer clear of them. But marketers can use data models to create a blueprint to achieve a company’s business goals and to improve the overall performance of their marketing activities, which could be a huge competitive advantage. And what’s not to love about that?
You have the data—what now? Creating personalized communications used to develop omnichannel experiences will help deliver the right message, to the right audience, in the right channel, at the right time (every good direct response article contains that statement, right?). Data-driven marketing allows brands to create customized campaigns that convert leads through a deeper understanding of each customer’s profile, which of course is the first step in creating that long-lasting relationship. With the myriad of data now stored in your database, you can sift through to determine the most accurate and actionable information about your customers. With this data-driven approach, it becomes infinitely easier to distinguish and group the target audiences you’re trying to reach. More importantly, the communications that are developed will be more targeted, more relevant, and more effective.
How effective, you ask? Well, one of our clients was mired in a state of classic ‘data paralysis’ before we began our engagement with them. After a two-day discovery session, we learned that they had the right data, but it was in three different databases which weren’t connected to each other, and some of the data was inaccessible to those who needed it most. Furthermore, they were using a ‘one-size-fits-all’ approach to their communications strategy. We immediately helped them reconfigure their data infrastructure, perform data hygiene, and create a customer segmentation, all of which enabled them to build an omnichannel communications plan. The end result was attracting more high-value customers, who spent more money and generated a 9:1 ROI in year one and a 12:1 ROI in year two.
Data-Driven Marketing Gives Businesses a Competitive Edge
So on this special day of love and giving, let me share a data-driven statistic with you that might give you some incentive, if you’re not already sold. The sad truth is that more than 50% of all businesses are not implementing some sort of data-driven marketing. More than HALF of all of the businesses…are you kidding me? Three years ago, that statistic was around 75%, and folks like me were imploring clients to pounce on this competitive advantage before everyone was doing it. Well guess what? Even three years later, not everyone is doing it, so implementing a data-driven marketing strategy is still a competitive advantage…but don’t wait!
Hopefully, I’ve given you a few reasons to structure a data-driven marketing strategy. If it’s used properly, it can be the key to your marketing success. Yes, data-driven marketing is a many-splendored thing. (Again, sorry guys…)
To learn more about how a data-driven strategy can make your marketing more successful, contact me.
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