Collecting and using customer data enables you to gain great and valuable insights into their purchasing behavior.
Learning to capture, interpret and use this data can make your marketing strategy more efficient and informed.
Marketing can be expensive. You need to efficiently manage your resources and track ROI.
How do you measure the success of your marketing plan? Are the results commensurate to the investment you have made?
Focusing on creating a data-driven process will help you harness the power of data to develop a working digital marketing strategy. According to eMarketer, over 40% of brands plan to increase their data-driven marketing budgets.
What Is Data-Driven Marketing?
It is the process of analyzing market or company-generated data, and in turn translating the insights obtained from such data into actionable strategies and decisions informed by the numbers.
Applying data-driven marketing effectively helps you discover what is beneficial in achieving your business objective in the best possible way that minimizes costs and maximizes your ROI.
Data-driven marketing tools utilized in the process increase the success of your business using the valuable information you collect from your customers. Using this marketing plan can help your small business grow exponentially.
How Does It Work?
To apply data-driven marketing, collect information on all aspects of a customer’s engagement with your brand and products.
This information may range from specific customer interactions to their demographic information.
Data-driven marketers use such data to predict customer needs, their desires, and project possible future behaviors.
Such customer insights help in developing personalized marketing strategies that aim at generating the highest possible ROI.
The Benefits Small Businesses Can Obtain from Data-Driven Marketing
If you start applying data-driven marketing in your small business, you stand a chance of reaping the benefits that come with it.
You will have a competitive advantage over other similar small businesses and a more-or-less equal chance to compete fairly with larger enterprises. Here are the benefits you will enjoy:
1. Improved Customer Experience
Data-driven marketing entails paying attention to customer experience and feedback.
It is a customer-centered endeavor that makes them feel recognized, appreciated and valued.
For your small business that is gaining traction in the market, a customer experience strategy is a cost-effective way to boost sales and improve customer satisfaction.
This will build customer loyalty and create long-term clients and customers who will sustain your growing business.
Listen to what your customers need. Are they satisfied with your current products? What product adjustments do they expect in the future? What other similar or complementary products do they need?
Paying attention to these concerns will improve customer experience. Ignoring customer feedback and criticism is the fastest way to destroy your brand. It can tarnish your brand and put its authenticity to question.
2. Benefit from an Experimental Culture
A data-driven marketing method must be supported by a strong company culture.
Your business models, values, practices and incentives must reflect your company’s prioritization of customer experience and satisfaction.
Adopting a data-driven process will inspire all your departments- not just marketing- to participate in the data-driven approach and understand its value to your business.
It will take your small business multiple failures to give room for more significant wins.
An experimental mindset allows you to test the market and figure out what works and what doesn’t.
So instead of choosing one option to introduce to the market, your team tries out different options and tests them against each other, then scales based on the results obtained.
With the freedom of experimentation, your business will get the chance to establish and grow fast.
Data-driven experimentation helps make sense of the data obtained and inspires progress by giving room for better decisions in the future.
3. Identify and Optimize Relevant Marketing Channels
The leads generated from various channels respond differently.
Data-driven marketers implement their strategies according to which channels best generate leads to improve conversion rates.
If you implement a data-driven plan, you will be able to identify which channels perform best.
You will also be in a position to identify which type of content associated with these channels best appeals to customers and produces the desired customer behavior.
Such information and decisions are important to a growing business.
At this stage, you are still building business structures. Get to know whether emails work best for you, or if your customers like engagements on social media platforms such as Facebook or Twitter.
Maybe it’s articles and blog posts that most appeal to them. Pick whatever produces the best results.
4. Improved Quality Across Your Organization
Receiving and analyzing new information derived from customer and market data enables data-driven marketers to constantly improve marketing campaigns in line with the customer’s ever-changing needs.
Receiving this new information helps small businesses improve the quality of their products and services.
It also facilitates diversification aimed at keeping up with the trend and changes in the business environment.
A data-driven marketing plan will compel you to improve your standardization, data completeness and accuracy.
This quality and consistency will have a ripple effect across all departments within your organization.
5. Accommodate Your Customers’ Diversity
You may think that broadcasting your organization’s message to as many people as you possibly can could be the most efficient way of implementing your marketing strategy.
Though it may be easier and quicker to identify what works for the majority of people, it is best to take some time and use market data to segment your potential customers.
Create a message that best appeals to the various groups of people.
Since this can be time-consuming, you can prepare templates for your marketing messages, and create content that best fits various segments of your target audience.
This can be achieved by making small yet significant variations to your message.
Being cognizant of your customers’ diversity is a more efficient way of targeting potential leads.
It produces more customers and increases conversion rates better than sending out a single one-fits-all message to hundreds or thousands of prospects.
Most small businesses are just getting started and are trying to cut out their niche in the market.
A data-driven marketing plan has been proven to be the most efficient way to achieve success within such organizations.
Collecting and analyzing customer data can help produce great insights that are in turn used to develop actionable marketing strategies.
The benefits you should expect to obtain from this marketing plan include a good response to customer diversity, improved quality, an experimental mindset and improved customer experience.