Before I actually speak about Data-Driven Marketing, consider this situation – Imagine you are a painter and you paint straight from your heart. You’ve made several paintings so far and received decent sales in the market. You want to increase your sales and you don’t mind making paintings that have a broader commercial appeal. As a marketing agency, we research on available data and share the following information with you –
a. The number of people who bought a painting with a religious theme/nature landscape/modern art.
b. The number of times people bought a painting that had blue as a dominant colour.
c. The number of times people bought a painting because their friends recommended it.
d. The number of people who bought a painting for the first time/nth time.
e. The number of times people bought a painting for a cause.
You go over the data and decide to make your next painting, aiming to reach a larger audience based on the above statistics. Your painting sells for a whopping amount! That’s Data-Driven Marketing in short.
The advantages of Data-Driven Marketing are short-term as well as long-term, and it helps you plan your business strategy accordingly. Here are summarizing five major benefits of Data-Driven Marketing –
i) Relevance – Understanding consumer behaviour and reaching out to the right target audience is half the battle won. There are approximately 40 million small businesses that advertise on Facebook. (Source: sproutosocial.com) With such tough competition and high bidding for ads, it is very important that your brand’s creatives are relevant to your target audience. By analysing data and understanding your audience, you can create ads that are more relevant and lower the cost per unit of advertising. You can also appeal to varied groups of audiences by creating tailor-made ads that appeal to people from various age-groups, races and nationalities.
ii) React Faster – When you know precisely how your target audience perceives you, how they purchase your product and how many times they see your ad before a conversion, you can react to their choices in a much faster manner. And this ensures a better relationship between the brand and the consumer.
iii) Evolve – Data changes every day. And so should your ad strategy. The best part of data-driven marketing is that every day is a new day. Constant monitoring and analysis of data sets reveal new information daily and allows you to dynamically evolve your marketing strategy accordingly.
iv) Better Funnel Perceptibility – How did your consumer first discover you? How many times did they visit your website before making the first purchase? Data knows everything! Using a data driven approach, you can enhance the understanding of your sales funnel and improve it appropriately.
v) Optimize ROI – Need I say anything more about this? It’s clear that data can help improve your ROI!
Data is powerful and data is omnipresent, omnipotent and omniscient! Data is GOD.