3 Common Mistakes to Avoid When Analyzing Data
By: Karen Blanchard Accudata
For all of the benefits data-driven marketing provides – from decreased customer acquisition costs to increased marketing ROI – there are pitfalls as well. Data can provide meaningful insights In order to better understand your customer base and even to develop a clearer picture of who is most likely to purchase your products or services.
Data-driven marketing increases the effectiveness of marketing campaigns with higher response rates, more customer engagement, and improved ROI.
Here are three common mistakes to avoid when analyzing data:
1. Relying too heavily on first-party data Who knows their own customers better than you, right? You might have a long list of people who have signed up to receive your newsletter and you know only their email address. Or you may have a CRM database of customers with data on the purchases they’ve made in the past complete with contact information and even product preferences.
But shopper data tells only part of the picture, mostly transactional information about how frequently purchases are made at which location or from which channel. Using data enhancement from third-party data, you can begin to gain a complete picture of who your customers are. You can append your customer database to add a customer’s age, marital status, education level, the presence of children in the home and known lifestyle characteristics such as hobbies and interests.
Data enhancement is a key step in developing a unified customer view so that you can understand your customers. Marketing messages tailored to your customers will result in higher conversions because of their relevance.
2. Forgetting to analyze your own customers Do you understand what’s unique about your customers? Although you might be able to tell me how frequently they’ve purchased or what colors they prefer, do you understand what makes them unique and different from people who don’t purchase from your company?
If you haven’t profiled your current customer base, you’re missing out on identifying common attributes among your audience.
AccuData Integrated Marketing has profiling technology that can match your customer records to a predefined set of demographics and develop a view of who your customer is through a concise, automated report called SnapShot. This comprehensive report creates a customized market penetration analysis with a detailed demographic view of your customers.
Using analytics to better describe your customer base can lead to insights that will help you in marketing, customer service, and sales. Imagine being able to send relevant email messages to your customer segmented by their unique qualities.
Data analytics also allow you to identify new prospects based on demographic look-a-likes of your current customer base. Once you know your market penetration and unique customer attributes, you can easily find prospects with those same qualities.
3. Not using analytics to focus your marketing efforts Predictive analytics can go way beyond just profiling your customers. By using modeling, you can actually predict which of your prospects is most likely to respond, renew or purchase. Marketing efforts can be sent only to those groups that are most likely to respond, saving time and eliminated effort spent marketing to non-responsive audiences.
AccuModel Response, from AccuData Integrated Marketing, compares responders to non-responders or renewals vs. cancellations, to uncover key differentiators and identify who is most likely to respond in the future. With this knowledge, you can find prospects that are most likely to purchase.
Deep customer insights can be gained with data analytics. Predictive analytics help you better understand your current customers and potential prospects, giving you the power to make better marketing decisions. Use your power wisely and you’ll increase marketing ROI.