Data-driven marketing: what is it and how do I use it?

What is data-driven marketing?

In brief, it’s an approach where your actions are backed by data; using information about your customers to decide what to do next, avoiding guesswork. 

Effective data-driven marketing has several parts, each dealing with data in a different way – from collecting it, to integrating it across channels, to assessing each interaction’s contribution to the outcome. It involves analyzing the dataset for insights, and optimizing marketing actions for the biggest wins. So let’s look at them one by one.

1. Gather first-party data

Not all data is created equal. At Billy Grace, we make use of the best data: that created by customers themselves when they search the web, consume information, and interact with sites and applications. Because every visit, every page, every click contributes in some way to their decision to buy. So the first step is to gather it all together.

First-party data is marketing gold … if you know how to make use of it. And that isn’t easy without the right tools. Because most of those interactions aren’t on your own website: they’re other sites, web searches, social media posts. With third-party cookies fading fast, marketers need new ways to understand the totality of customer behavior. AI can help gather it.

2. Connect the customer journey

Customer behavior, of course, is complex. The journey between initial awareness and first sale progresses through multiple touchpoints, in different places, across various devices. Perhaps a customer filled in  a web form years ago, but purchased elsewhere. Perhaps he views social media every day on his phone, but only researches products on his desktop. It’s all relevant.

Data-driven marketing seeks the Big Picture, by stitching together disparate sessions and interactions into a single view of the customer journey that combines website analytics, social media interactions, CRM events, and email marketing. It’s both art and science and AI, again, makes it make sense.

3. Get accurate sales attribution

In data-driven marketing, understanding is everything. But it’s far too easy to jump to conclusions. Which event was the “critical push” that prompted the customer to buy? Assuming it was that last click on a PPC ad, or a likable link in an email offer, doesn’t give the whole story. The actual decision may have been driven by an insight-packed research paper or an information-rich web page earlier; without that event, the purchase wouldn’t have happened. 

This is marketing attribution: understanding what *really* delivered the sale, and how each interaction affected the outcome. And it can be modeled. How much each click mattered to the whole process; what all those searches, ads, and views contributed as a team; what weight to assign each visit. With models like Unified Marketing Measurement in the mix, AI can deliver these insights at scale.

4. Use AI-assisted analytics …

The trouble with getting the Big Picture is, well, it’s big. Big numbers. Big datasets. Big Data. For data-driven marketers that’s a problem, because the insights from analysis need to be visible at human scale. That’s why the most effective data-driven marketing uses dashboards that bring together CRM reports, email campaign statistics, search and social, and all other channel integrations into a singular, purposeful view.

Seeing analyzed data as easy-to-share charts and graphs makes the insights visible and actionable. Ad and channel managers can see trends, patterns, and customer behaviors in the data: what happened between A and B and how y followed x. And when you understand it, you can create campaigns and strategies that take advantage of it. 

5. … and AI-assisted optimization

Once the data tells you what works, it’s time to do more of it. Data-driven marketers use optimization strategies to customize content for specific demographics, segment offers by psychographic drivers, target advertising to customers right when the data predicts they’re ready to buy. 

A lot of data, of course, means a lot of optimization opportunities. And that’s where data-driven marketing can outsource tasks to AI. By recognizing patterns in data and where resources can be dialed up or down for better bang-per-buck, marketers can balance adspend and outcomes in the way that  maximizes ROAS … and ROI for the business as a whole.   

Why should I use it (more)?

The bigger question: why wouldn’t you use it? Adopt data-driven marketing across your organization, ideally with a tool like Billy Grace, and you’ll see benefits accrue to every column and line, including the bottom one. Here’s a checklist of what data-driven marketing does for your business.

• It integrates all relevant data, by gathering not just the data that’s easy to see, but connecting the data that isn’t: further-flung datasets from search keywords, web logs, social media views, and content views. It’s how you learn where your results are really coming from.
• It builds a deeper understanding of your customer. Whether you call them personas, targets, or partners, your customers probably don’t all fit one definition. Seeing the true richness of their behavior patterns helps you tailor your approach to each for greater returns.
• It avoids duplication across channels, by stitching interactions on different devices at different times into a single customer journey with an identified actor doing it. No more sending a prospecting email to someone who’s been your customer for years simply because they got a new laptop. 
• It lets you share and understand as a team. Comprehensive analytics dashboards make complex data meaningful, helping everyone understand your marketing landscape and where the opportunities are. Leading to unified agreement and actions in faster time.
• It shows you how to market more effectively. Optimizations of campaign and budget can turn a good campaign into a terrific one, or show you where a promising nurture program needs more investment to perform at its peak. It’s all about honing your edge.
• It reduces Cost per Acquisition. When you’re reaching each new prospect in the most effective way, the sales cycle gets shorter and response rates rocket above average. Which means lower costs per success.
• And builds retention over the customer lifetime. Every transaction, every interaction, is an opportunity to deepen the relationship and create customer delight. After all, that first sale is just the start.  

Last, there’s a surprisingly people-centric benefit to adopting data-driven marketing with AI automation and optimization: the opportunities for human creativity. 

With less time bent over spreadsheets and web reports, your team can explore new ways of attracting and retaining customers, develop fresh campaign concepts, and test ideas based on what the data reveals about customer behavior and motivations. In marketing today, being driven by data isn’t limiting: it’s empowering. And that can only be a good thing.