While probably 90% of marketing professionals use data when activating their programmatic media campaigns, only a small percentage of those marketers are likely to say their data needs are met completely. That’s because data seems so overwhelmingly complicated that they are reticent to dig in — and just as reticent to ask questions of their partners and agencies.
It’s not surprising that marketers are overwhelmed by data. There’s so much of it available right now — and so many tools to manage it — it’s hard to know where to start! In fact, marketers report that they struggle with nearly every data-related endeavor. This includes using data to find and reach audiences, analyzing data, and figuring out how to use it to tell the stories they need to share.
It’s clear that marketers need to understand how to use data more effectively and more confidently. Here’s how:
Start From The Bottom
Rather than starting with third-party data representing a broad swath of audiences matching a certain demographic or psychographic, marketers should instead "flip the funnel" and start by looking at the data points that define their actual customers. From there, marketers can understand who it is that’s actually buying their products and embracing their brand, and build out an effective strategy based on that data.
It’s critical to know what you have in terms of first-party data. That data will be different for every company, depending on what your business is and how your goods and services are sold. For many businesses, this data has been captured in a CRM — and it is your greatest asset.
It’s well worth the effort to understand what you have in terms of your first-party data because it’s likely to tell you everything you need to know about your customers. Once you know what you have in your database, it’s easier to decide who you want to add to your database, and what their attributes are. You’ll also gain insight into how you can get more from your current customers in terms of up-sell and cross-sell opportunities.
Once you know what you have, your next step is to decide what you want to do. Assuming your goal is to find and win new customers, you may want to begin looking at complimenting your own data with third-party data.
Back Up The Funnel
Let’s say, for the sake of illustration, you’re a travel marketer selling discounted airfares. If you’re starting with your own customers, you’re looking at people who have already purchased tickets from you. These are the people you know travel by air and are motivated by lower prices. Looking closely at these customers and how they travel, you can use your first-party data to determine who might consider an upgrade on their next flight, or who might be persuaded to fly more frequently (this would be the “consideration” phase if we’re sticking with our analogy.)
Your next step is to use third-party data to build new audiences based on your best customers. Find customers who fly competitor airlines. Find other business travelers. Find people who have bought family vacation packages. Quality data can help you discover and build new audiences that have attributes similar to the customers you already know.
As you move up the funnel, you can continue to find net-new customers. You might target travelers who have taken long bus trips or who have traveled by train in the past. Perhaps they’d consider a flight for their next trip if the price is right. Try targeting people who have booked hotels in destinations that cater to vacationers like Hawaii or the Caribbean.
By reverse-engineering your data-driven audience-building efforts, you can better target consumers who are likely to become your next best customers.
If you’re new to data-driven marketing, this “look-alike” strategy is a great place to start. Work with your agency or technology vendors to find a trusted data partner who can provide high-quality third-party data to supplement what you already have.
Although look-alike targeting is fairly straightforward, there will be challenges, and you’re not likely to get everything right the first time. Like everything in digital marketing, data requires testing. You will make assumptions about your data, and you’re likely to be biased by what you think you know. However, digital gives us the opportunity to test and optimize for better results. If your assumptions about your audiences are not accurate, try different audience bases and see how your results change.
The key is to try, to experiment and to get comfortable working with data. Data is a prime element of digital marketing, and marketers need to get more confident in their use of it.
Chris Emme is the Managing Director for the Americas at Eyeota, an audience technology platform. As a contributor, leader, writer and 20+ year industry veteran, Chris is passionate about working at the intersection of data, technology, media and analytics. At Eyeota, Chris is responsible for accelerating the company’s growth throughout the U.S., Canada and Latin America.