- On this blog post, you'll see:
- The new paths of data-driven marketing and how it can help retention;
- How data-driven marketing can help out your SaaS company;
- How to properly segment your contacts and hyper-personalize your messages.
Let's cut to the chase: the main focus of data-driven marketing is to provide value by increasing customer engagement. You can use data to almost every item of your marketing strategies from lead generation to customer acquisition and retention, up-sell and cross-sell strategies, customer experience, and much more. It sounds like the marketing nirvana: targeting the right people, at the right time and place. But it may not be that simple.
The biggest challenge is to properly analyze the data from visitors, leads and customers. After all, statistics can be a little tricky and not everyone has access to data visualization tools. This might be the reason why only 33% of marketing professionals say that are "very successful" with data-driven marketing.
According to a report by Ascend2 and ZoomInfo, one of the highest priorities when working with data-driven marketing is to be able to target individual marketing segments, as well as personalize the customer experience
With the right marketing automation platform, you can hyper-segment your customers to ensure that you target only the right people by creating highly personalized messages. It transforms the customer experience into the most pleasant and suitable experience that your customer has ever faced.
Data-Driven Strategy in 2016: what does it mean?
For marketing professionals, working with data is nothing new. In fact, data is the base of marketing: in the past, the whole focus was on knowing and understanding customer's past behaviors. "Who was buying the product?", "When did they buy it?", "Where did they buy it?", and "What did they buy?".
In 2016, the urgency is to use data in order to predict outcomes and future behaviors: "Who is about to buy the product?", "When will they buy the product and through which channels?".
Still, in today's business, the biggest danger is to focus only on mastering data-driven insights to drive results, forgetting about the creative side of the messages. It's important to keep a balance between numbers and emotions. Remember that you shouldn't become so dependent on analytics, especially if you stop thinking about why consumers engage. This approach fails to understand what truly motivates customers and reduces the brand's identity.
In 2016, data-driven marketing proved to be a great strategy to increase a company's revenue. In July 2016, according to Direct Marketing Association (DMA) and Winterberry Group 40,9% of marketing professionals say that their organizations' revenues grew at least somewhat from Q1 to Q2 2016 because of data-driven marketing activities.
How hyper-segmentation can help your business
Rumor has it that customer segmentation is dead. At least that's was what big players like IBM's CEO Ginni Rometty say. Ginni stated that segmentation, as a marketing strategy, has become an obsolete idea. The main cause? Big data! But it turns out this is not entirely right.
In fact, you can use big data to narrow your customer segmentation and focus your efforts on the desired market. Customers have different needs, desires, preferences and priorities, but getting track of every individual user to address their expectations is not always possible. But it can be, with a data-driven strategy.
A data-driven strategy can be used to gather great marketing insights to offer services, products, and solutions based on demographics, behavior and other information.
If you're not thinking segments, you are not thinking marketing.
However, without a strategic plan of attack, your top prospects risk being just another name on a list of people that "may or may not" stay in the company, or even worse: abandon your product and turn into your competitor's newest customer. To effectively close more deals and actually increase your revenue through a data-driven strategy focused on retention, you need to figure out how to utilize data from customers to create deeper personalization.
Being able to narrow customer segments allows marketing and sales to increase the effectiveness of their lead nurturing towards users that are more likely to close faster. Besides, hyper-segmentation allows you to use all of your customer data to pinpoint specific marketing problems you can solve for smaller customer groups.
The benefits of data-driven segmentation
The most wanted and expected result that comes from data-driven segmentation is customer engagement. Once you are able to identify your customer's needs and interests, and cross this information with their behavior within your product or website, it's possible to develop customized campaigns to address their needs. Engaging customers with custom communication channels and motivational offers is the most effective way of building customer loyalty and increase customer retention.
In other words, with a personalized nurturing strategy after the conversion, you guarantee that not only your customers stay with you, but come back for more (upselling or cross-selling) and talk about your brand to their friends, family, and colleagues, much like a referral marketing strategy.
A large majority of marketers (90%) wants to move beyond segmentation towards one-to-one personalization in a real-time interaction context.
Reliable data is one of the main benefits of segmentation and it is essential to the process. After mining and cleansing your data from unnecessary and fragmented information, all you have is the most accurate and relevant data about customers. Data-driven segmentation relies on the ability of the marketing automation platform to create, and identify, actionable data – how often they interact with the product, their buying habits, and preferences, what they currently own and, most importantly, what they're looking for in your product.
With the correct information in hand, you can streamline mass customization, which means you can use the analyzed data to customize your products and services to fit a larger number of customers. By offering custom-tailored services to a large segment of customers, you improve the level of customer satisfaction.
Alongside with that, a data-driven marketing strategy can help you expand to new markets. With the customer data - and a good analytic eye - it's possible to predict what your customers may want to buy next, which new product should be offered to particular prospects or even the next best market to enter with your product.
Although the focus of this content is to retain customers that already converted, it doesn't hurt to know that segmentation can also help increase your conversion rates. According to Jupiter Research, conversion rates (whether via direct mail or email) improve 355% with customer segmentation, leading to increased revenues of up to 781%, taking into account segments based on customer data such as how much the customer spends, brand interaction, and customer lifecycle management.
How to use Smart Segments to increase retention
To make the most of your data-driven marketing strategy, you must accurately define and profile your audience to leverage its targeting capabilities to the greatest advantage. This requires effective, data-driven segmentation.
In an era of big data, hyperconnected digital customers and hyper-personalization, segmentation is the cornerstone of customer insight and understanding across the modern digital business. The question is: Is your segmentation approach antiquated or advanced?
Smart segments make it possible to segment contacts in a countless number of ways. By setting as many conditions as needed, the created segment can be really specific, to determine exactly which customers fit that information. Customers can also be segmented by their customer lifecycle stage, interactions with sent emails, past activities and type of device: everything can be used to reach the right audience with the right message.. Since it's possible to create different segments according to your company's needs, all your groups stay listed in a segments dashboard.
For your company to achieve a better ROI, you need to figure out which customer segmentation parameters fit groups with the highest revenue potential, and then prioritize your marketing and sales efforts on those users.
With the right segmentation, you can send better leads to your sales team and therefore improve the chance of purchase, renewal or upselling. You can arm your sales reps with valuable insights into each prospect or customer. With that, they can have more meaningful conversations with highly qualified prospects who have a clear pain point your product can solve.
For existing customers the insights acquired from a data-driven marketing strategy allows to pre-plan personalized conversation points, tailoring a unique message to leverage engagement and retention. And this is one of the main benefits of a big data analysis strategy.
An important advice: ensure that your data is accessible by all departments. Don't be the gatekeeper of the valuable data: sales, marketing and customer success teams must be aligned and communicate openly with one another to drive the highest return on strategies.
And, of course, keep your data updated. Old data can lead to irrelevant messages being delivered to your audience, and this can make leads and customers back off from your company.
Breaking down your data with marketing automation
However, it's not enough to just have the data in your hands: you need to break it down into meaningful, actionable intelligence. It's one thing to possess data, but something entirely different to break it down and use it to properly communicate with customers. Luckily, most marketing automation platforms offer reporting capabilities, making the task of analyzing the gathered data and measuring the engagement levels of customers much simpler. But the icing on the cake is real-time marketing: this turns personalization into hyper-personalization, and makes your marketing strategies truly relevant and contextual.
Hyper-personalization is the next step of digital marketing: emails with dynamic content based on where the customer is and when the email is opened. Context-based messages and "segments of one" all tie into building more relevant communication with your customer and pushes only messages they want to receive, ultimately resulting in increased ROI.
After sending highly personalized campaigns, you can then use the engagement metrics and achieved results to define the target audiences for future campaigns.
Focusing on individual customers is the defining principle of data-driven marketing, as your job as marketing professional starts and end with the customer. This customer-centric approach needs to make sense for both the company and the customer: the key is to connect your efforts around the customer, across all the customer lifecycle.
Also remember that data-driven marketing is measurable. Everything about it can be analyzed: messages, offers, response rates, engagement, demographics, behavior, lifecycle stage and money spent on orders. So keep track of your data to further analyze it and use the results on your behalf.