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What is Data-Driven Marketing and Why is it Important?

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Data-Driven Marketing allows companies to optimize information about their customers and use it to develop marketing strategies. The marketing industry has undergone massive changes in recent years, resulting in no longer needing to make decisions based on assumptions or gut feelings.

Today, marketers seek information from the most reliable source: consumer data.

 

What is Data-Driven Marketing?

Data-driven marketing is a marketing strategy based on consumer data and trends, focused on collecting and using information to make and implement marketing decisions.

Data-driven marketers can study what consumers buy, how they respond to ads, and how they behave. The goal of data-driven marketing is to take active, quick responsive steps according to their target audience’s needs and answer their questions.

Then, the data is used to predict future consumer needs, desires, and behaviors, allowing the marketing strategy to ensure maximum return on investment (ROI) based on collected data about the ideal consumer.

The data-driven approach has three main advantages:

 

  1. Establishing effective connections with customers;
  2. Increasing efficiency;
  3. Improving performance.

What's the difference between Data-Driven Marketing and Traditional Marketing?

 

Traditional marketing and data-driven marketing have the same goal: to attract the target audience and force them to make a purchase decision.

Traditional Marketing

Traditional marketing is any marketing activity that is not conducted online. This includes print, broadcast, mail, telephone, and outdoor advertising such as billboards or yard signs.

 

When identifying and developing the right message for the target audience, traditional marketing combines data from focus groups, customer satisfaction surveys, and past sales trends, with first-hand experience and gut instincts rather than data.

Data-Driven Marketing

Data-driven marketing uses data as the primary source of marketing activities. By analyzing data, marketers can:

  • Determine what type of content will be successful for the internet audience;
  • Determine how effectively their communication reaches a specific target audience.

Marketing data can be obtained through various media channels, including web browsers, telephone networks, social media, and smart TVs.

Some specific examples of data-driven marketing are:

  • Using demographic data for better ad utilization;
  • Using one marketing channel to inform another (e.g., using PPC campaign results to inform your SEO strategy);
  • Using customer data to increase engagement and revenue (like the ever-popular Spotify Wrapped campaign);
  • Data can also be used to improve search engine optimization (SEO), allowing for better understanding of the target audience.

In short, traditional marketing has very high costs and low profit margins and will generate less results than data-driven marketing.

 

Data-driven marketing is not only cheaper with higher profit margins, but it also has a much wider reach than traditional marketing. Most importantly, it helps businesses generate more sales – at a lower cost.

See the Data-Driven Marketing Program

What are the advantages of Data-driven marketing?

What are the advantages of Data-driven marketing? Data-driven marketing is a fantastic tool for marketers and should be incorporated into every marketing strategy to some extent. But, like any other tool or strategy, it has both positives and challenges:

It allows you to better define your target audience The main benefit of understanding

  1. the target audience is the guarantee that you’ll be able to create a message that will resonate directly with them. With data-driven marketing, marketers can get a lot of information about their target audience.

CRM (Customer Relationship Management) reviews allow marketers to better understand customer behavior by analyzing customer history data and using this data to improve business relationships with customers.

 

In traditional marketing, marketers have an idea of who their target audience is, but, apart from past trends, there’s no real data to establish a better relationship with them.

It helps you create relevant content for your audience Collecting data helps marketers

  1. deliver the right content to the right audience. If they understand the problem their audience is facing, they can more easily offer solutions to these problems to consumers. By evaluating consumer data, marketers get information about:

 

  • What type of content (short, long, beginner, advanced) drives consumer interaction;
  • What kind of visuals/creatives (real people, graphics, diagrams, memes) resonate with consumers;
  • What kind of formatting (infographics, lists, case studies, videos, guides, blog posts) affects engagement;

It helps deliver a personalized brand experience Data-driven marketing helps an organization retain consumer attention for longer and establish a stronger connection with its audience by creating personalized messages and content for specific target audiences.

Consumers often become disappointed with brands that send general messages to their audience, so delivering personal messages is essential for your audience, as this can lead to purchases or conversions.

You'll learn which channels work best for your company CRM software such as Semrush, Salesforce, or Hubspot allows data-driven marketing to track the customer journey from the first point of contact to the final sale

Using CRM helps you track the actions and behavior of current or potential customers through your website, social media, or email marketing campaigns. It alerts the sales representative if a customer is interested in a product.

 

By collecting this type of data, marketers can determine which channels will work best for their target audience and which channels will take them from initial contact to final purchase.

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