Data Driven Marketing: everything you need to know
In digital marketing, data is everywhere. It helps us make decisions: we choose one option over another because data confirms that it is the right solution to choose. Without data, there is no rational decision.
Doing so is Data Driven Marketing. A discipline that is becoming increasingly popular and that you can no longer do without if you want your advertising and marketing campaigns to perform well. At GrowthYouNeed, we see ourselves as experts in data-driven marketing: we have developed in-house decision support tools based on artificial intelligence to make the most of data. Here is an overview of what we are talking about.
What is Data Driven Marketing?
Data Driven Marketing is a term for a form of data-driven marketing. The general idea is to base every decision you make - whether it's a high-level strategic decision or a simple day-to-day operational decision - on data collected from users, to make sure you make the most effective decision.
Let's take an example: an online store sells any kind of products. To find new customers, this e-merchant uses Google Ads campaigns. In order to maximize his performance, he tries to improve the title of his ads and wonders if using this or that synonym would be more interesting, to increase the number of clicks on his ads. In everyday life, he personally uses synonym A, but one of his friends told him that he uses more synonym B. This information made our e-merchant doubt: what if the Internet users also prefer synonym B?
So he sets up an AB Test on his campaigns, by creating two groups of similar ads. The first one uses the synonym A, the second one the synonym B. He lets his ads run for a while, then looks at the performances. His analysis shows that synonym B tends to increase his click rate and consequently his number of conversions. The e-merchant therefore makes his decision: he will use synonym B for his ads from now on.
So we see: thanks to factual data, we were able to overcome a prejudice and make a business decision that will improve performance. That's what Data Driven Marketing is all about: making the best decisions, thanks to rational data.
How does Data Driven Marketing work?
To use Data Driven Marketing, you need data to rely on. Without data, you can't make rational decisions. The first step, when you want to do marketing based on data analysis, is to be able to collect it.
Online, data can be collected from everywhere. From your website, using tracking tools like Google Analytics, you can study the number of visitors, check which pages they visit... If you are doing online advertising, most of the platforms and agencies will propose you to install, on your website, a pixel or a tag to follow the visitors' engagement and the conversions. In fact, today, all forms of digital marketing must be data driven: without data, you have nothing. You can't run a marketing and media buying campaign without data: you would be acting purely on intuition or blindly, and you would risk missing a lot of useful information, or even being completely wrong. It is therefore necessary to install all the trackers you need for your operation. They can be grouped together in one place, such as via Google Tag Manager, which allows you to multiply your tags without marring the performance of your web pages.
The second step is to read and process the data. This is a problem that often arises when you have multiple sources of data: how to use them wisely? It is essential to define your KPIs, Key Performance Indicators, to determine what data you need to make decisions. Do you want to increase your click-through rate on your ads? Measure the click-through rate, the number of impressions, the number of clicks, for example. If it's the engagement of your visitors on your website that worries you, then the number of page views, time spent on the site, bounce rate or number of sessions per visitor can be interesting KPIs to monitor. Tools like Google Studio allow you to create dynamic dahsboards to gather in one place all the data you are interested in depending on the goal you are trying to achieve.
Finally, once you have selected your data, you need to exploit it. What business decisions should be made based on what this data shows us? To help you make decisions, several techniques exist, such as AB Tests. We create two almost identical scenarios, changing only one parameter. We let these two scenarios develop, and we measure the KPI of each of them. The one that obtains the best performance then becomes the winning scenario: this is the one that is chosen for the next step.
Any marketing strategy, whether digital or not, must be based on data: this is what we explained in our Growth Marketing Guide. At the base of any advanced strategy, we find the ability to collect - and especially to collect WELL - data.
What are the limits of Data Driven Marketing?
Data Driven Marketing is everywhere today: most organizations naturally rely on data to make their decisions. But there are still limits to this methodology, which we must be aware of.
The first is to make sure that the data is clean and true. All too often, we see tags that are poorly set up and return false data. Making strategic decisions based on incomplete or false data can have catastrophic consequences for your business by making you make the wrong decisions.
A second limitation is the scope of the data. You can collect as much data as you want, but you will never have an exhaustive and perfect knowledge of all the parameters to take into account. When we carry out an AB Test, we limit the number of modified parameters as much as possible, but there are still some that we cannot control. For example, we do not control the people who receive the scenarios. You can create similar demographic groups, but the individuality of each person cannot be taken into account: you get general results, but what applies to one group of Internet users may not apply to the next despite similar characteristics. The data provides trends and analysis of what has happened, from which we can imagine the future. It is not pure prediction, but simply hypothesis.
How Artificial Intelligence reinforces Data Driven Marketing
At GrowthYouNeed, we have developed tools that use artificial intelligence to help us make decisions about our clients' campaigns. The goal: to make increasingly rational decisions and have the best possible vision of opportunities to exploit them.
A human cannot process all the data received in all possible ways. A properly trained algorithm can. With these tools, we can spot opportunities that would have remained hidden from human analysis alone. The result? Ad campaigns that perform better and ROI that soars.
You want to know more and see what could be the opportunities for your business? It's right here!