Is Marketing Really All About Data and Analytics?
German Sacristan, Kodak
I keep reading papers and articles that make me feel as if marketing today is only about data analytics. Surely analyzing data is critical, but there's more to it than just that.
I see marketers making decisions based on the data they have and failing because it's not the data they need. It's not about collecting as much data as possible and analyzing it for the sake of it, but about defining first what data you need to help you be more relevant when communicating with your target customer, then having a strategy in place to build that data through market engagement and research. This is a process that sales reps have been using successfully for hundreds of years when visiting customers face to face: Listen to what's important and disregard the rest, and then use just the important information to be more effective in communications towards closing the sale.
The main purpose of having the right data is to help you profile your target customers successfully. Organizing them into different profiles will provide you with the information you need to be more relevant when communicating with them. It's always easier to sell to someone you know than someone you don't know. Profiling is so important that if you get it wrong, you might end up talking to the wrong person, with the wrong message, at the wrong time, and in the wrong way.
How to create successful profiles
When you create profiles you also create a blueprint that will help you find your target customers. Classifying them into different profiles will also help you address them in a more personal way. Finding and classifying your target should be an ongoing activity and part of your main strategy:
First, define the profiles based on what you need to know from your target:
- What are their personal characteristics? Based on what you sell and where you sell it you need to ask yourself what personal characteristics you need to know that will help you communicate more effectively with your target. You might decide that it is important to know their age, gender, income, status and political tendency. Then you will profile based on that. It is not about creating thousands of profiles, but creating the ones that will help you be more relevant when communicating with your target customers. Looking at your existing data to see who is currently buying what from you will help you further form your profiles. You can also look at who's not buying what from you and analyze why. This analysis will help you find out if some individuals or companies (in the case of B2B) are not buying because they're not a target or because you have failed promoting to them.
- Why would they buy from you? You need to be aware of the different buying criteria linked to the products or services that you sell.
- When would they buy? Knowing your customer's purchasing timing and frequency is priceless.
- Where? You will need to make it easy to your target customers to buy from you, so knowing if they'd buy online and/or offline will help you drive them to their preferred place of purchase.
- How? It is all about knowing your target's purchasing behavior and habits.
- What other products or services have your target customers already bought? Purchase history is highly relevant for a cross- or upsell strategy.
Often just by looking at your target customers' personal characteristics profiles and analyzing your existing customers purchasing activities you can make low-risk assumptions about buying criteria, time, and frequency, as well as place of purchase and purchasing behaviors and habits.
As you can see it isn't just about analyzing data but providing guidance on what data needs to be retrieved and looked at or analyzed. We still need to use our brains and be a critical and active part in the process. Software can help marketers but can't replace them.
Classifying target customers
Once you create your profiles you need to start classifying your target customers into each one of them. To do so, you need information. Sometimes you'll know something about your target customers, but not all you need to know. In these cases you might be able to make intelligent assumptions with the information that you have to help you classify your target customers. Look at your CRM data to see if what you know is enough to help you learn what you don't know. For example, knowing addresses can provide relevant demographic information like income. In other cases you'll have to buy the information that you need from a company that sells it. Or, you can build information through market engagement and research:
- Describe your market engagement channels:
Human: customer service and hotlines, technical service, billing, direct and indirect sales channels, telemarketing, on- and offline communities and social events.
Non-human: online shops, on- and offline advertising, other campaign marketing activities.
- Build a market engagement plan to constantly retrieve relevant information:
Train human channels on how to pull customer information, and set up an incentive plan for them to do so.
Implement incentive plans to encourage off- and online visitors to provide information.
Put in place a strategy to follow customers online.
Launch marketing campaigns with the only objective of retrieving information. Start by using the customer information that you have to get the information that you need. Then, make it easy to your target to provide you with the information that you need. For example, use a QR code with an incentive for target customers to register online.
Link engagement channels (human and non-human) and marketing activities to your CRM system.
- Use market research:
Examine customers' websites in the case of B2B.
Track customers in their social media networks.
German Sacristan is Return on Marketing Investment developer at Kodak and author of The Digital & Direct Marketing Goose.