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Modern Data Stack: How It Works In Marketing

nikolai valiotti modern data stack

For marketing, efficiency is everything. Ineffective marketing might turn out to be a significant waste of money. Not to mention, your business will be likely to lose revenue and become more costly. In turn, this will negatively affect every employee. Adopting the Modern data stack solution is a way to boost the effectiveness of your marketing strategies. And, as a result, boost the overall effectiveness of your entire business. In this article, we are going to discuss this solution and the best ways to implement it.

What It Is

Modern marketing is a very complex field. In order to promote products and services, companies use a variety of advertising platforms, analytical tools, and performance indicators. They all can provide a massive flow of data that only a handful of companies are able to utilize to the fullest. Most businesses calculate ROI and LTV, and roughly understand which activity can bring the best conversion and how much it costs to attract a customer. However, this is but a tiny part of what Modern data stack can really provide.

Modern data stack is a solution that allows you to use data’s full potential in order to find the proper parameters for your marketing model.

“A modern data stack is a tool that helps increase the effectiveness of marketing and, as a result, the effectiveness of the entire business. It shows the best result when implemented by specialists.”

Let’s assume you released an application and ran an advertising campaign in order to promote it. As a result, users began installing your app, and some of them made in-app purchases. How much does one paying customer cost you? How much money should be spent on marketing? What kind of marketing helps bring a paying customer? How long will it take for your investment to pay off? You can answer these questions by aggregating and analyzing the data collected from several sources in a unified database.

modern data stack

First Source

These are advertising platforms such as Google Ads, TikTok, and others. You can store all advertising-related data in a single database using data ingestion tools. You can either order such tools from a relevant specialist, or use ready-made tools: Stitch, Fivetran, or Airbyte. They can collect data based on the parameters you set.

Second Source

A second source is tracking and attribution systems for apps, such as Appsflyer or Adjust. They can collect information about individual users: who they are, how they found your app, and what they are using it for. This data also gets stored in the database.

Third Source

Finally, this is the application itself. It allows you to find out how and when the users launch your app, what functions they use, and whether or not they make purchases. To that end, tools like Firebase can be recommended.

What’s Next

Afterward, we end up with a database full of data. In order to increase marketing effectiveness, you need to transform that data using a tool such as dbt or own Python scripts. It allows you to create multiple data marts containing information about the users of your app. They can be sorted by different advertising platforms and lots of conclusions might be made based on the following data: date of registration, date of the first purchase, and the way to find your app.

Complete Picture

In the end, you are able to get a complete picture of how marketing works and see how much money users from each network in each region of presence brought you. Another use is calculating how much the company spent on advertising campaigns in each region and ad network. Ultimately, the transformation tool helps create showcases of data and can support the process of updating them regularly, since data flow never stops.

Data visualization tools, such as MetaBase, make viewing that data even more simple and illustrative. Through them, you can access the database and get the result based on a set of parameters. For example, you can compare day-to-day marketing cost changes and revenue by region and platform. You can also perform cohort analysis, visualize data, and get helpful marketing reports.

Final Thoughts

Modern data stack is recommended for companies that spend substantial funds on marketing, starting from $10,000 a month. In fact, any startup spending money on marketing should consider using it. If the costs are much higher, implementing this solution can pay for itself in less than a month, since businesses with a large advertising budget often underperform, wasting some of that budget.

It is also important to remember that an investment in implementing the Modern data stack is also an investment in creating a massive database. However, data availability doesn’t help to solve the problem by itself; you will need correct and competent data visualization, which will highlight problem areas. Marketers can use it at their discretion and make use of data in their work: watch, analyze, make conclusions, and hypotheses.

I would recommend inviting specialists to carry out the implementation. They will help create a ready-made working tool based on quality policies and data management standards. This tool will help increase the effectiveness of marketing and, as a result, the effectiveness of your entire business.

Author: NIKOLAI VALIOTTI, Founder & Data Consultant at Valiotti Analytics.

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