Maximise ROI with Data-Driven Marketing Strategies

When considering the purpose of marketing efforts, the primary objective is to get a high return on investment. Using data-driven marketing gives your proposals for investment legitimacy, as they use customer data rather than gut-feelings. 

In this article, we prove just how impactful data-driven marketing is, and why you should be incorporating it into your everyday business strategy.

Data-driven marketing defines the approach of optimising your external communications based on customer information. Using customer data allows marketers to predict their needs, desires and future behaviours. This insight helps develop tailored strategies that are more likely to succeed with bringing a higher ROI.

Here are some examples of data-driven marketing:

• Targeting your customers based on their demographics
• Using insights from paid search campaigns to guide your SEO strategy
• Creating personalised content from user data (e.g. Spotify Wrapped)
• Emailing customers about products they’ve abandoned in their online carts

Marketing has two main objectives: discovering the customers’ needs and desires and using that insight to deliver what they want to buy. These two objectives enable marketers to develop strategies that sell their offering to customers in a way that will appeal to them the most.

Traditional marketing teams used a combination of two factors to achieve their objectives:

• Market studies 
• Their assumptions about the target audience

Unfortunately, this approach leads to a lot of trial and error. Meanwhile, data-driven marketing allows marketers to connect with customers at the right time with the right offer.

The benefits of using data go beyond improving communications. Data-driven marketing teams can also use customer insights to:

• Personalise the customer experience
• Target specific demographics
• Appeal to new customers

Using data in marketing helps teams make informed decisions. Here are some of the main benefits of data-driven marketing:

Enhance Customer Targeting and Segmentation

Gathering and analysing data about your customers gives a deeper understanding of their motivations.

It is vital to segment your market and define key customer profiles. This enables you to:

• Create highly tailored marketing materials that drive better results
• Reduce distribution costs through targeting smaller groups of people
• Fine-tune your brand image to align with each target segment’s values

Improve Personalisation and User Experience

Data-driven marketing enables marketers to deliver messages based on individual needs, preferences, and behaviours. 

Better Customer Experience

Data-driven marketing focuses on using in-depth customer profiles to make the customer experience better. By implementing a level of personalisation thanks to the data available, marketers can grow a relationship between a company and its customers. McKinsey reports that personalised experiences can give 5-8 times the ROI on marketing spend.

Streamline Decision-Making

Data-driven marketing streamlines decision-making because it gives marketers valid reasoning for proposing a specific approach.

Therefore, there’s less need for stakeholders to debate over opinions and ideas. For instance, you can’t argue that one marketing channel is better than another if your data say otherwise.

Too Much Data

Having data is a great way to make informed decisions, but too much data? It’s easy to become overwhelmed if the amount of data you have is pulling you in multiple directions.

Here are some tips to overcome this:

• Invest in user-friendly, reliable, and multifunctional tools
• Incorporate data into your marketing strategy one area at a time
• Build analytics dashboards that allow you to focus on the most important metrics

Lack of Data Literacy

Data literacy is the ability to understand and act upon data effectively. If anyone in your team lacks data literacy skills, it can lead to ineffective decision-making and be a complete waste of time.

Here are some tips to overcome this challenge:

• Invest in data analysis training for your staff
• Select tools that provide clear results and takeaways
• Regularly review outcomes and investigate any issues
• Use automations to reduce the risk of error

When developing a plan to implement data-driven marketing, consider our following tips:

Give Value

Data-driven marketing is about improving marketing success based on an enhanced customer experience. With this in mind, customer experience is key. 

Consider your customer and what they find important. Based on the data you have, what is the problem your customer is trying to solve? Where in the buyer’s journey are they? 

Highlight Clear Advantages

Customers are more likely to give their personal information if they believe they will get better deals or more value out of their brand interactions. Make it clear to customers that they will receive something useful if they allow your company to store their data and build user profiles. This may be personalised product recommendations or insider information in a newsletter. 

Be Transparent

Many customers have become more concerned with how companies are using their data. Marketers must be transparent with what information they are collecting, how they will use that information, and how it will be stored. Maintaining a high-level of visibility into where data resides will allow marketers to track and modify data as requested by customers. 

In Summary…

If you are using digital marketing, chances are you are already using data-driven marketing within your strategy already. But are you utilising this information to get the most out of your efforts? At Propeller, we boast a team of marketing experts, on hand to improve your ROI with our tried and tested strategies. 

Talk to a member of our team today to see how we can help you.