According to the 2017 DMA Statistical Fact book, the biggest challenge facing today’s marketers is creating an effective marketing mix across all channels in order to drive the best possible results while saving costs. If you’re like most marketers, you’re probably struggling to accurately quantify the impact your marketing efforts have on sales revenue. There might be days where mastering all the latest technologies seems like a full time job.
Proving marketing ROI is not only one of the top priorities for today’s marketers, it’s also one of the more difficult objectives to achieve. There can be many reasons for this, ranging from budget limitations, company culture, and lack of executive buy-in to siloed data sources and uncertainty regarding which customer segments or channels to focus on. Implementing data-driven marketing strategies will enable you to develop integrated, omni-channel marketing programs that more effectively engage your customers and drive crucial business revenue.
There are many ways that implementing data into your marketing strategy can improve your marketing ROI. The right data will not only help you target specific market segments, it can also enable a more personalized customer experience. Whether your goal is to acquire new customers, generate additional revenue from existing customers, or prevent costly churn, the right data can ensure you’re focusing the right resources into the marketing channels that are most appropriate for each customer segment.
Having access to the right data can help you better understand the entire customer journey, ensuring your marketing promotions are relevant, timely, and targeted. Let’s say you’ve been tasked with acquiring new customers or reducing your overall cost per acquisition. Life stage data can help you streamline your customer engagement strategy by optimizing your customer segmentation efforts. Life stage data provides valuable insights into when consumers are moving, getting married, having children or undergoing other important life changes. These time periods, when needs, purchase behaviors and brand affiliations change dramatically, are critical for finding customers who are interested in your products and services, and ensuring you’re effectively tying consumer behavior to specific campaign objectives.
Your acquisition costs, and overall marketing costs, can be further reduced by implementing a cloning or look-alike model to identify common attributes amongst your most profitable customers and then applying those insights against a prospective target audience. These data models enhance customer segmentation by identifying those customers who are the most profitable to go after based on existing customer data.
Data can be extremely beneficial when it comes to retention efforts and generating additional revenue from existing customers. By ranking customers based on the likelihood that they will respond to a particular offer, response models can be used to identify both cross sell and upsell opportunities. RFM (recency, frequency and monetary) models can also be useful in determining best customers by identifying key attributes, including how often they shop, how much they spend, and how recently they interacted with your brand.
The use cases for predictive models are numerous. Are you trying to entice a seasonal customer to become a more frequent shopper? A RFM model can be implemented to develop a boomerang offer that encourages an additional trip to receive exclusive savings. Do you wish to identify the optimal promotion that will encourage customers to redeem their offer while still maximizing your profits? A model can also be used to create an escalating offer across different customer segments that answers that exact question.
Regardless of your particular campaign objectives or current challenges, it’s clear that data-driven marketing will help with developing more integrated, cohesive messaging. By creating personalized offers based on customer preferences, you’ll be able to develop omni-channel communications that not only resonate with your customers but also incentivize behavior that drives sales, ultimately improving your marketing ROI.
Source: DMA 2017 Statistical Fact Book