Brands that use it effectively improve targeting and personalization, understand their customers better, retain customers better, and optimize marketing costs.
Those who ignore it, on the other hand, rely on luck to hit their marketing targets. In short, they guess their way to customer acquisition and retention. So, what’s this critical element of marketing?
I’m speaking of marketing data. Here’s what you need to know about it to confidently develop and adjust marketing strategies.
What is Marketing Data?
Marketing data refers to sets of information generated by potential and buying brand customers during various interactions.
The customers could be interacting with each other or directly with the brand through channels like social media, Email, surveys, or polls. And, it is during these interactions that you get to collect data points like comments, content shares, and likes. These data points and more make up what we call, marketing data.
The scope of marketing data is defined by the use of these data points. They are used to track the effectiveness of marketing strategies, understand customers, and make better marketing decisions. What’s more?
Types of Marketing Data
Since marketing data is sourced from multiple touchpoints, including social media platforms, web analytics, or survey forms, marketing data points are categorized to simplify understanding. These are the common types of marketing data and how your brand can put them to good use.
1. Engagement data
Engagement data is a category of marketing data that includes data points showing how potential or buying customers are interacting with your brand’s marketing campaign or content. Such data points include social media shares, comments, mentions, and likes.
2. Behavioral data
Often linked to product or service usage, decision-making patterns, and purchases, behavioral data is about observable decisions and actions rather than just how they engage. Such data includes purchase history. Here, you track what, when, how often, and how much a customer purchases to yield a behavior pattern.
3. Demographic data
Demographic data is more like creating a profile of your current and potential customers. Some profiling data points you can collect include age, income level, education level, occupation, and gender. With such data, it becomes easier to segment your market share and curate your messaging.
4. Psychographic data
Unlike behavioral data that focuses on observable decisions and actions, psychographic data digs deeper. It is a marketing data category that includes data points that can tell why someone took a certain action or made a specific decision. Such data points include values, beliefs, hobbies, interests, and lifestyle choices.
5. Transactional data
You get transactional data when a customer transacts with your company or brand. From their payment details to the nitty gritties like items bought, quantity, items returned, and subscription renewals, you can collect this data and use it to group customers based on spending frequency, amount, and privatization.
Why is Marketing Data Important?
Now, let’s see why you should even bother to actively collect and analyze marketing data. Remember, there are more reasons but these are the core:
1. Powers personalization
Ever wondered how Netflix suggests shows? Yes, the secret is marketing data. Netflix collects and analyzes view history and search keywords to recommend shows. By doing this, the users feel valued and understood. That’s what we call personalization.
Customers don’t just want to consume your content and ads, they want you to make an effort to understand them. That’s why you ought to collect engagement, behavioral, and psychographic data to understand what’s going on in a customer’s mind. This way, you can recommend products or services that customers are more likely to respond positively to.
2. Helps you understand customers better
Apart from personalization (being in the position to recommend a product or service), analyzing marketing data can reveal who your customers are, what they value, reveal their behavior, and provide insights into spending habits.
Most of the marketing data types play a role in this. For instance, demographic data profiles customers while psychographic data uncovers customers’ interests, beliefs, values, and lifestyles.
3. Boosts marketing ROI (Return on Investment)
Thanks to marketing data analytics, you can tell what platform hosts most of your target audience. This prevents wasted spend on underperforming marketing channels. For example, if X ads bring in more return compared to Meta ads, it makes more sense to invest more on X ads.
Use marketing data to track performance of various marketing strategies. This will help you identify the most valuable customer segments and what platform they dwell on the most. Also, actively analyze behavioral and transactional data to find cross-selling and upselling opportunities, boosting your marketing ROI.
4. Gives you a competitive advantage
Marketing data analytics uncovers what customers want, guiding product marketing and development.
Through engagement, demographic, psychographic, and behavioral data, you get to tailor experiences that feel one-of-a-kind. This is much more effective than casting a wide net with the hopes to catch fish.
With real-time marketing data, you can adjust marketing strategies on the fly. Competitors without access to real-time data can’t do this, allowing you to own the top spot.
Moreover, rather than innovating based on assumptions, marketing data can tell you what’s in demand. This way, you only create once the customers give you the signal, staying one step ahead of the rest.
5. Optimizes marketing and sales decision making
Rather than running a marketing or sales campaign from start to finish and then getting into analytics, the marketing team can collect marketing data during execution. Breaking down this data should inform them whether there’s a need to adjust the strategy mid-flight or not.
Other than strategy decisions, marketing data analytics influence budgeting decisions. Analytics can tell what campaigns, channels, and moves generate optimal results. This way, you double down on what works to optimize marketing spend and ROI.
Not forgetting, the sales team can use behavioral and transactional data to prioritize leads. When you have purchase history and frequency data, it becomes easier to tell which prospects are more likely to convert.
Wrapping up!
While consistent marketing and sales efforts can make a difference, doing it without considering the data leads to wasted resources, time, and money. That’s why marketing data analytics is crucial when creating marketing and sales strategies and executing them.
Marketing data eliminates the guesswork, allowing you to confidently navigate marketing hurdles. You can also use this data to direct innovation as it reveals what customers want.