Data-driven marketing is an analytical marketing approach that relies on data obtained from third parties, interactions with customers, etc. The purpose is to help make data-based decisions and optimize marketing performance by relying on demographic, psychographic, satisfaction, and other data variants.

Marketers often rely on gut-instinct for predictions or decision-making, but backing those up with data is close to a foolproof approach to do things the right way. It is important to have a well-defined analytics and data strategy whether you are an agency, blogger, or a thriving marketer.

Moreover, understanding how to use & combine data-driven marketing with other marketing streams is essential as it can show you how they perform and how you can improve them. That includes data-backed information on how to better allocate your budget, what to change and what are your marketing pain points.

Simply put, the most important benefits of data-driven marketing are:

1. Effective decision-making
2. Getting more customers
3. Better data integration across multiple platforms
4. Improved client experience and brand awareness
5. Significantly more engagement from the target audience

In this article you will:

• Learn where to apply data-driven marketing
• Understand the potential benefits of integrating data-driven approach to your business
• Discover actionable, real-life examples of the impact of data-driven marketing you can also use for your own business

Get long-term ROI.

We help you grow through expertise, strategy, and the best content on the web.

See Client Results

Reason 1 — Take personalization to the next level

One way data can help you is by giving you all those difference-making details about your customers you need, to make their experience more personal. Personalization is a concept that stretches across every aspect of your business and will show your customers how well you know and listen to them. A good personalization strategy will make your interactions more natural and demonstrate that you really understand their pain points.

Furthermore, using data to collect all the necessary details about your customers like demographics, specific interests and content they want will scale up your whole business. It will give you everything you need to tailor your products, content, or automated lead generation campaigns towards the specific interests of your customers. Highly personalized content will account for a great personalized customer service that makes you stay ahead of competition.

Example: You can use this information for dynamic retargeting ads that use personal data to create personalized ads for each customer specifically. Say you run a travel agency and you want to offer your customers more personalized experience. This can include personalized travel offers tailored to their previous travel history.

You can combine data like your customer birthday and previous travel history to make a unique retargeting ad. Precisely, you can use emails to send your customers birthday wish cards that have their previous travel history attached to it and give them a special birthday offer. A person is more likely to treat himself for their birthday and making a unique, personalized offer will naturally push them to accept it.

One more example is to get creative with data and make a visually appealing email that sums up customer’s previous travel experiences with your company. This email should use images of their top destinations coupled with numbers that show:

• how many trips they made with you
• how many countries they visited
• the distance they traveled
• their first trip with your agency

Combining their travel statistics and giving them a personalized offer will really deepen your relationship and instill trust that will show them that you care. That way, they are more likely to recommend you, continue using your services and stay loyal to your agency. When it comes to data-driven marketing for your brand, utilizing a virtual data room provides a secure and accessible platform to store, analyze, and leverage valuable consumer insights for targeted marketing campaigns.

You can top retargeted ads off with additional perks like discount vouchers, VIP offers, loyalty cards, a rewards platform, and similar, to give them an all-encompassing experience and reward their loyalty to your brand with various marketing personalization tools. Here is how retargeting works when using emails.

One way to enhance the effectiveness of retargeting is by leveraging the power of data. Business travel booking companies, for example, can utilize customer data to create personalized experiences that cater to individual preferences. By analyzing demographics, specific interests, and previous travel history, these companies can tailor their offerings and communications to match the unique needs of each customer. For instance, sending a personalized email with birthday wishes that includes a summary of the customer’s previous travel experiences can make them feel valued and special. By combining such data-driven personalization with additional perks like discount vouchers and loyalty cards, business travel booking companies can foster stronger relationships with their customers, inspire trust, and encourage continued loyalty.

Reason 2 — Effectively build buyer personas

With the help of data, you can delve deep into your customers’ personas and ultimately understand who they are. Data makes it possible to analyze their opinions, needs, and ultimately, their characters. These are the main prerequisites for creating buyer personas — a good enough representation of your ideal customer, interested in purchasing your product.

Now, the best way to build a strong buyer persona is to use qualitative and quantitative data backed up by real-world problems your leads or customers face. You will need the actual data instead of only using gut feeling or, even worse, wild guessing. This data-driven approach can answer:

1. What are your customers’ problems and why they think your brand is the solution?
2. How do they perceive your brand and is there something about it that doesn’t resonate?
3. What are their expectations and how deeply are they invested?
4. Which of your brand values drive loyalty?
5. What matters the most when choosing your brand — the price, the quality, the prestige, or something else?

After obtaining these answers and thoroughly analyzing them, you can build essential elements in the form of digital character traits to ingrain in your buyer persona. There are many sources to gather this data and here are some of the most popular and effective ones.

Surveys

Surveys are an ideal way to get insightful data in case you have a lot of customers. A simple mobile survey with up to 10 questions will easily help you collect enough information, hassle-free. Not only will it show your customers the desire to hear them out, but it will also help build additional trust with them. When making a survey, ask some basic questions like gender, profession, age, etc reinforced by at least one open-ended question aimed to collect qualitative data about their personalities. You can use an AI survey creator to generate questions and start your research.

Social media and website analytics

When you have a brand, your goal is to have as much digital presence as possible, and social media plays an indispensable role here. You can collect data like demographics, interactions, and opinions that will aid in shaping your buyer personas. .

Since not all your followers are your actual customers, you can additionally dedicate yourself to collecting the data that will help transform a follower into a customer. For that, you will need to understand how to match your brand’s values with the values of your followers or what obstacles are preventing them from becoming a customer — and data-driven analysis is a great way to do it.

Moreover, using basic (and native) social media analytic tools like Twitter Analytics, Facebook Audience Insights, and Instagram Insights is more than enough for the start. Use Google Analytics when you want to collect similar types of data for your website.

Miscellaneous

To build an outstanding buyer persona that replicates the real buyers as closely as possible, you’ll need to go even deeper. It is important to cover as many aspects from your customers’ perspective as possible, and that includes:

• Analyzing your competition and how your customers interact with them
• Collecting as much feedback for your brand as you can from other channels (Yelp, LinkedIn, online communities, etc for example)
• Analyzing customers’ orders and previous purchase history related to your brand

Lastly, it is important to get creative and experiment, as there are many unconventional, but still, original approaches to gathering various types of data.

Reason 3 — Data-driven marketing for product development

Product development is the process of creating a solution or improving an existing one to solve your customers’ problems more effectively. As such, this process undergoes many stages that require real-time and accurate data for it to be the most effective. These are 5 stages of product development and each of them requires specific data for crafting the best product possible:

1. Generating ideas
2. Research
3. Conceptualizing and prioritizing (for this stage, it’s essential to use the right Affiliate Marketing Software to speed up the process and avoid many pitfalls afterward. For example, product roadmap tools help you prioritize your initiatives and then visualize them on a shareable roadmap)
4. Prototyping
5. Promotion and rollout using data driven advertising

You can use data to enhance,improve or automate each of these steps, but let’s specifically analyze the first step — Generating ideas with the help of data.

Data-driven idea generation

The foundation of the whole product development is idea generation. For this stage, you need real-world data and in-depth research to generate viable ideas that you can base your product on. That said, you will need a lot of data to identify opportunities, analyze the market and notice the patterns revolving around your audience pain points.

When considering ways to enhance an existing product, leveraging product management tools to go data-driven can provide a clear starting point. By collecting quantitative data related to customer interactions, identifying reported issues, and pinpointing micro-pain areas, you gain insights into where improvements can be made.

Qualitative data will uncover how your customers feel when using your product and if any component of UX makes them frustrated or dissatisfied. It will show you how effective your product is in solving their problems and if it really solved them on a psycho-emotional basis.

Therefore, quantitative data will show you exactly what and where to improve and qualitative data will help you understand how to do it. Balancing these two types of data will help you make optimal decisions to improve underperforming parts of your product.

Another important use of data is for data-driven product management revolving around making decisions or creating marketing strategies based on real-time data from the real world.

Reason 4 — Market expansion

Market expansion is an important segment of scaling up your business as it opens new opportunities which can skyrocket your ROI or reinforce your brand’s presence. This can be risky, but also a profitable way for growing your brand. You can minimize this risk while getting all the necessary inputs for the expansion with the help of data-driven marketing.

Example: You want to expand your brand and related products across the new market and you identified two growth paths you can follow:

1. You can try to use existing products to solve new problems
2. You can focus on discovering a new audience with a high demand for your product

Let’s say you chose the second option and now you have a new challenge — understanding the new market. For that, you will need to focus on finding out the market size, opportunities it offers, demographic and psychographics of its audience. This is not an easy task and a data-driven approach can help mitigate all the fuss and difficulties in navigating in this new market.

In particular, start with surveys to collect the data you need to start expanding. Surveys will help you get the basic information about the demographics and psychographics of the audience. Using data-driven software you can collect and process publicly available data to determine market size. You can also collect data about new market trends, competition, customer acquisition, and many more.

When processed, all of this data will transform into actionable insights to start expanding with mitigated risk of failing. Once your brand expands, data-driven strategy can be useful to monitor and measure how you perform as well as to supply you with new data to further improve.

Finally, you can analyze your internal data to optimize your marketing strategy if you are doing business in several markets. That will help you dive into what are called “micro-markets” and using data to measure and analyze their performance can help you make good decisions, without involving the risk of expansion.

That way, you will be able to see which of your existing marketing channels drives the most traffic and the specific traits of the leads it generates. When you apply these insights to micro-markets around your brand, you will be able to clearly see if there is room for expansion and where that room is. Facebook’s Lookalike audiences is a great example of using characteristics of a specific audience consisting of your best customers to advertise to a similar audience in different markets (e.g. different countries).

Reason 5 — Improve your content

One thing that keeps your customers gravitating to your brand, apart from the quality of your products & services, is the quality of your content. That’s why it is vital to produce high-quality content and crucial to be able to measure its performance and the effect it has on your audience.

This is where data-driven marketing comes in handy as it gives insights into how well each content format performs. In addition, there are a lot of data-driven metrics that can effectively measure your content KPIs like traffic, conversion, and engagement. This can help you decide what type of content your audience prefers and further enhance according to your business objectives.

What’s more, using real-time data helps get into specifics of each content type that drives content KPIs, which can give you a significant edge. Knowing exactly what your audience prefers and the whys behind it is a path towards a stellar content strategy.

You can apply these data-driven insights to older content as well. For example, you can transform some of your old blog posts into a presentation with a lot of visuals — if you discovered that your audience finds it boring to read a lot of text.

Another benefit of going data-driven is adjusting content to each of your marketing and brand communication channels. Data will help you here by providing demographic and activity information of your target audience for each channel. Simply put, different demographics prefer to engage with different content formats and behave differently depending on their demographic group or channel they use.

When you get all this data transformed into insights, you can tailor the content on each channel to what your micro-audience prefers. Furthermore, you will be able to set the appropriate tone and narrative for each channel to most optimally match your content strategy.

Final words

It is important to start implementing data-driven marketing for making better decisions, improving advertising campaigns, and ultimately, empowering your brand across many aspects. Depending on your brand’s values, gauge which ones resonate the most or devise your own tailor-made approach to use with your brand.

Data-driven marketing and brand improvement go hand in hand, especially with the constant expansion of BigData. Integrating data-driven approaches and technologies to the core of every business is the future and there is no escaping it. However, that doesn’t mean neglecting gut feeling and human reasoning, because we are those who drive data to make transforming effects to our businesses.

Lastly, with disruptions from the COVID-19 outbreak still in effect, businesses started and will continue to shift towards operating in the digital world.

That means more digital markets and digitizing processes to support the new “contactless” reality.

Not surprisingly, data-driven approaches will be in higher demand than ever before to provide businesses stable groundwork to survive and thrive.