Data-driven marketing, in theory, is about better using the flood of customer-related data to integrate and optimize marketing efforts in the age of an empowered consumer and Big Data.
What matters most is the optimization of the customer experience, relevance and (perceived) customer value as a driver of business value. Data-driven marketing certainly is not (just) about advertising and programmatic ad buying as some believe. Nor is it just about campaigns. On the contrary: if done well, data-driven marketing is part of digital marketing transformations whereby connecting around the customer across the customer life cycle is key.
The Role and Evolution of Data-Driven Marketing
One of the pioneers and leading voices is data analytics and marketing software vendor Teradata. A while ago, the company recently released the results of its Teradata 2015 Global Data-Driven Marketing Survey. According to Teradata, marketers who adopt an integrated and data-driven marketing approach become more empowered across all areas including the various stages of “engagement” as described in the illustration below from the page of the 2013 survey the company conducted.
The Various Stages of Customer Engagement - Teradata (Click Image To Enlarge)
At the occasion of the launch of the 2015 edition of the survey, Teradata said it saw some “dramatic shifts in how companies and marketers are deriving business value from data, integrated marketing platforms, and customer-centric data-driven marketing strategies” as compared with its 2013 report.
Among the key findings of the Teradata 2015 Global Data-Driven Marketing Survey:
- A large majority of marketers (90%) wants to move beyond segmentation towards one-to-one personalization in a real-time interaction context.
- Faster decisions and more accurate decisions are reported as key benefits of using data in this real-time economy. Two-thirds of respondents cite speed and accuracy in decisions as key benefit.
- For 38% of respondents the major challenge is improving both customer acquisition and customer retention.
- 78% of marketers in the survey claim to use data systematically. In 2013 this was only 36%.
Omni-channel consistency and silos remain hurdles
Respondents see data-driven marketing as a means to an end and for several an integrated marketing cloud approach seems like the way forward from a platform perspective. Of course, Teradata is one of several major providers of such a marketing cloud (like Adobe, Oracle, Salesforce.com, IBM, Microsoft etc.).
Obviously there is a gap between what marketers would like to achieve with data-driven marketing and what they actually achieve. Many hurdles remain, among others regarding consistency in an omni-channel marketing context whereby silos are the eternal challenge, also from a campaign marketing perspective.
More about the evolutions, challenges, customer data issues (privacy, regulation, ownership) etc. in the press release, the report and the infographic below.
Given the huge attention for data-driven marketing (and, admittedly, the big marketing cloud wars we see happening), there is of course more research looking at the state of data-driven marketing and the drivers of it. In a second infographic below the one from Teradata, we’ll take a closer look at more research – with a second infographic.
Data-driven marketing: customer-centricity and customer experience first?
It’s not just the vendors and marketing cloud providers such as Teradata who come up with research.
Recently, the GlobalDMA, “an organisation that represents, supports and unites marketing associations from around the globe that focus on data-driven marketing”, looked at the state of data-driven marketing and data-driven marketing practices in 17 global markets.
It did so in collaborations with strategic consultancy for the advertising and marketing industry, Winterberry Group.
You can access the report for free on the website of the GlobalDMA (registration required). Just like Teradata, the report found that marketers – obviously – increasingly see the importance of a smart use of data in marketing, customer experience and advertising (the whole programmatic advertising concept).
In an infographic on AdWeek, infographist Carlos Monteiro summarized some of the key takeaways from that research (and from Teradata’s 2015 Global Data-Driven Marketing Survey).
How Data-Driven Marketers Outperform Their Competition - Adweek by Carlos Monteiro (Click Image To Enlarge)
Data-driven marketers outperform their competitors according to The State of Marketing 2013 by IBM – another contender in the marketing cloud wars – source: presentation by Jason Heller of McKinsey at Integrated Marketing Week 2013
Among the key takeaways of the data-driven marketing report by the GlobalDMA:
- 77% of marketers are confident in the data-driven approach and 74% expect to increase data marketing budgets this year.
- Data efforts by far focus on offers, messages and content (marketing) first (69% of respondents). Second ranks a data-driven strategy or data-driven product development. Customer experience optimization unfortunately only ranks third with 49% of respondents.
- Among the key drivers of increased data marketing: first of all a need to be more customer-centric (reported by 53% of respondents). Maximizing efficiency and return ranks second followed by gaining more knowledge of customers and prospects.
The question is what will be done with this knowledge. And here we see that 20% reports a need to align with digital consumer preferences.
So, it seems the digital customer experience does matter as it’s essential for a more customer-centric approach and the – for many in practice – extremely urgent need to align with (digital) consumer preferences or, maybe better, catch up with the changed customer reality, in the end the essence of what digital marketing transformation is all about in the first place.
Infographic – via AdWeek and made by Carlos Monteiro – below. You can download the Winterberry Group/ GlobalDMA report here.
Click Image To Enlarge
COMMENTARY: Customers today expect—and demand—a seamless and relevant experience. They have grown accustomed to marketers’ knowledge of their preferences and anticipation of their needs. Fractured or conflicting messages from a brand make marketers seem unorganized and annoy customers, sometimes even driving them away.
For marketers, the only solution is data-driven marketing for individualized insights. Teradata defines data-driven marketing as
"the process of collecting and connecting large amounts of online data with traditional offline data, rapidly analyzing and gaining cross-channel insights about customers, and then bringing that insight to market via a highly personalized marketing campaign tailored to the customer at his/her point of need."
Data-driven marketing is the means that leads to the end of individualized insights: moving beyond segmentation to true one-to-one personalization in a real-time context— achieving the capability to distill insights at the individual level, and the ability to target known customers in a digital marketing ecosystem that often settles for “close enough.”
A well-integrated data-driven marketing program that provides a single view of the customer is the path to such individualization, and can result in business benefits that are just waiting to be tapped. The data in this report is based on a survey of 1,506 marketing and communications executives worldwide, representing all major industries. The survey was conducted in the fall of 2014, and follows a similar survey conducted in 2013.
According to Mark Jeffrey, Kellogg School of Management, Northwestern University, and author of "Data Driven Marketing," there are 15 essential marketing metrics that all marketers should know.
Click Image To Enlarge
People-Centric Targeting Across All Screens
What is it: Media consumption habits are more fragmented and diverse than ever, as consumers engage with multiple screens and devices. And in this multi-channel world, isolated, one-off marketing strategies and closed technologies no longer make sense. Advertisers don’t need a social plan or a mobile plan; they need to take full advantage of all available data to develop a people-centric plan that zeroes in on customers wherever they are and when they are most likely to engage. This requires platforms that can integrate data across channels and provide transparent, objective analysis of performance across every marketing touch point.
In the following schematic, Mark Jeffrey illustrates the process of gathering customer data from multiple sources, the flow of that data through the processes of validation, cleaning, transformation, aggregation and loading that data into a centralized data warehouse for business intelligence purposes.
Click Image To Enlarge
Why it’s important: People-centric marketing is even reaching the world of linear TV, where new streams of data from set-top boxes and connected televisions are making it possible for advertisers to programmatically buy specific audience segments rather than focusing only on shows and time slots, which is how TV has traditionally been bought and sold.
Data will continue to blur the lines between TV and digital, between mobile and display, and even between direct response and branding. It all comes down to the person — whether the screen they are looking at is on their wall, at their desk or in the palm of their hand.
Why it’s hard: Cross-channel engagement is the cornerstone of people-centric marketing. The challenge, though, lies in evaluating attribution — an understanding of how well channels performed in engaging targets. Several years ago, this degree of accountability was impossible to achieve because data analysis tools hadn’t yet innovated to the point of granular attribution. Today, however, multi-touch attribution platforms, driven by more recent advances in machine learning and predictive analytics, have made this a reality.
Courtesy of an article appearing in i-scoop, an exerpt from the Teradata's 2015 Data-Driven Marketing Survey and an article dated August 28, 2015 appearing in VentureBeat
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