Data-driven marketing optimizes decision-making using comprehensive data analysis. This approach identifies the most effective channels, messages, and target audiences, ensuring marketing budgets deliver maximum impact. Agencies specializing in data-driven methods offer enhanced precision in reaching desired audiences, elevating client campaigns' effectiveness. Explore key insights for elevating your agency's data-driven strategies.
Your marketing agency has a variety of website data and analytics at its fingertips to improve your clients' digital marketing strategies.
If you know where to look and how to analyze the right information, you learn which of their posts tend to perform the best on social media, how people land on their websites, which pages convert visitors to buyers, and what to improve upon to see better results.
Years ago, I was involved in a great debate over a particular source of leads. The sales team wanted them stopped because the conversion rate was lower than other sources, and–on the surface–that recommendation made sense. After all, it took the sales team twice as many calls to close the same number of sales.
However, when we thoroughly analyzed ALL of the pipeline data, including the cost per lead, sales team costs, sales team utilization, and average revenue per closed sale, those lower-converting leads were driving a 65% increase in ROI compared to other channels.
Without completing a data-driven analysis of the lead sources, we could have easily turned off what resulted in a very lucrative source of leads and revenue.
This article covers the best data-driven marketing tips to help your agency harness the power of data that get the best results for your clients.
Benefits of Data-Driven Marketing
Before we cover any of the benefits, what is data-driven marketing?
Data-driven marketing is a term used to describe marketing decisions and strategies based on data and analytics. This can involve everything from using data to segment customers and target them with personalized messages to using data to optimize campaigns and track results.
Data-driven marketing aims to use data to improve marketing performance and ROI.
There are many benefits of using data in marketing. Data can help marketers segment their audience, target their messaging, personalize their campaigns, and track results. By using data-driven strategies, marketers can make more informed decisions that lead to better results.
Other benefits include:
One reason data-driven marketing is so important is that it allows marketers to be more efficient with their time and resources.
It can help marketers improve their understanding of customers. By understanding customers better, marketers can create more targeted and effective marketing campaigns.
Additionally, data-driven marketing can help marketers identify new growth opportunities. By understanding customer behavior, marketers can identify new markets to target or new products to develop.
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How Is Data-driven Marketing Different From The Traditional Marketing Strategies?
The biggest difference between traditional and data-driven marketing is how decisions are made. There’s a famous quote about marketing efficiency.
Half the money I spend on advertising is wasted; the trouble is I don't know which half.
The quote has become a bit of a cliche when it comes to the uncertainty about the marketing and advertising effectiveness, especially without data. And back when this quote was originally attributed, data-driven marketing wasn’t a thing.
Traditional marketing relies more on intuition and experience to decide where to allocate resources. This approach can work well, but it can also be very inefficient and has the potential to waste a client's marketing spend. On the other hand, data-driven marketing uses data analysis to inform decision-making, which can lead to more effective and efficient use of resources.
For example, one key difference between traditional and data-driven marketing is how goals are set. Traditional Marketing often sets goals based on gut feeling or past experience. Rough concepts like “summer is typically a slower period” are often used for traditional marketing planning.
In contrast, goals based on data will use historical trends and comparative analysis to set targets based on past performance. In this case, data would back up that notion, such as “although traffic remains consistent through July & August, the conversion rate is expected to drop by 17% based on data from previous years.”
Although both overarching concepts were correct in projecting that revenue would be reduced in the summer months, the data-driven example is far more specific regarding the what and why behind that reduction.
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On the opposite side of the spectrum, data-based marketing can often debunk what might appear on the surface to be a strategic marketing decision.
An example here could be the assumption that Facebook Ads do not perform as well as Google Ads because the users aren’t as engaged or actively in need of your client’s product or service.
However, by digging into the data, your agency could discover that although the conversion rate is lower, because of the average cost per click, the cost per acquisition on Facebook Ads is lower than on Google Ads. Or, perhaps, the average order value is much higher, meaning they buy less often but purchase much more, driving a better ROAS.
What Is a Data-Driven Marketing Agency?
A data-driven marketing agency uses data to inform all of its marketing decisions. Or at least as many of its marketing decisions as possible in today’s privacy-first world. This means that the agency will use data to determine which marketing channels are most effective, what messaging is most effective, and who their target audience is.
The benefits of working with a data-driven marketing agency are that clients can be sure their marketing budget is being spent in the most efficient way possible. They can also be confident that their message is reaching the right people, as opposed to just spraying and praying with their marketing spend.
Overall, being a data-driven marketing agency is a great way to ensure that marketing efforts are as effective as possible and provide value to your clients.
What Insights Do Data-Driven Marketing Agencies Need?
There are a number of different types of data that can be used for data-driven marketing, including customer demographics, customer behavior, and campaign results. Marketers need to clearly understand how much and what type of data they need to make result-driven decisions about their campaigns.
Customer demographics are one type of data that can be used for data-driven marketing. This type of information includes things like age, gender, income level, education level, and geographic location. Digital marketing analytics provides a wide variety of data for eCommerce businesses, and Social Media analytics that deliver tons of cross-channel marketing insights for all of your clients' campaigns.
We’ll provide a few more examples later in this article to help you make the best digital marketing dashboards and become a data-driven agency!
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What Are the Major Data-Driven Marketing Activities?
Since data-driven marketers use data to understand customers, create personalized experiences, and measure the success of their marketing campaigns, there are a few tasks you would need to perform to help create a data-driven marketing strategy for each of your clients.
The major data-driven marketing activities include:
Customer segmentation: Segmenting customers based on their behavior, demographics, or other characteristics allows marketers to create targeted messages that are more likely to resonate with each group. For example, tools such as HubSpot, SharpSpring, and Drip, can help with this kind of customer segmentation by creating marketing automations targeted by user behavior.
Campaign tracking and measurement: By tracking the performance of individual marketing campaigns, marketers identify which ones are most effective and adjust accordingly. This also allows them to allocate resources more efficiently. From overall website analytics to specific campaign performance from Google Ads, Facebook Ads, and more, understanding campaign data is critical to being data-driven.
A/B testing: By testing different versions of a campaign or landing page, marketers determine which one is more effective and make changes accordingly.
Personalization: By collecting data about individual customers, marketers create more personalized experiences tailored to each customer’s needs and preferences. This can lead to higher levels of customer satisfaction and loyalty.
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Which Tools Help With Data-driven Marketing?
There are a number of different technologies that can be used to support data-driven marketing. Here are a few of the different types of data-driven marketing tools:
Data analytics tools: These tools help you collect, cleanse, analyze and visualize data so that it can be used to inform your agency's decisions. Some popular data analytics tools include Google Analytics, Tableau, and Clicky.
Customer relationship management (CRM) systems: CRM systems can help you manage and analyze customer data to better understand your target market. Some popular CRM systems include Salesforce, HubSpot, and Zoho.
Marketing automation tools: These tools can help you automate marketing tasks such as email marketing, social media campaigns, and targeted ads. Some popular marketing automation tools include HubSpot, Pardot, and Marketo.
Data visualization tools: These tools can help you visualize data in a way that is easy to understand and can help you make better data-driven decisions. Some popular data visualization tools include Tableau, Google Charts, D3, and–of course–AgencyAnalytics. The goal is to use data storytelling techniques to help clients understand the value of your agency's services.
A/B testing tools: These tools can help you test different versions of your website or product to see which one performs better. Some popular A/B testing tools include Optimizely, Visual Website Optimizer, and Google Optimize.
How To Implement Data-Driven Marketing
In a data-driven marketing campaign, all decisions are made based on data. This means that marketers analyze customers, campaigns, and/or website data before any action is taken to see what will work best.
There are a few things that need to be in place before starting a data-driven marketing campaign:
A good reporting tool: To make decisions based on customer data, you need to have a way to collect and store it.
Data analysis skills: Once the data is collected, it needs to be analyzed to find trends and insights. This requires strong analytical skills.
The ability to take action: Once the data is analyzed, marketers need to be able to take action based on what they see. This could mean creating new marketing campaigns, changing existing ones (such as optimizing Google Ads campaigns based on data from Google Ads, Google Analytics, and CRM platforms), or even just adjusting your approach.
A willingness to experiment: Data-driven marketing is all about experimentation. You need to be willing to try new things and see what works best for your customers. If you're not willing to experiment, you'll never know what could have been.
How To Analyze Digital Marketing Data: Data-Driven Marketing Examples
By analyzing data, your agency can see what is and isn’t working with your marketing strategies and make changes accordingly. This provides the information your agency needs to target your client's customers more efficiently and effectively. There are many different ways that you can use data to drive marketing. Here we will explore a few data-driven marketing examples.
Monitor Bounce Rate and Target New Keywords if It’s High
Your client's website bounce rate is the percentage of people who click through to your website from a search engine results page (SERP) but then leave without clicking through to another page.
This is usually an indication that the visitor did not find what they expected when they clicked on the link, which could be an indication of poor targeting (such as bidding on the wrong keyword), subpar content (such as a blog post stuffed with more keywords than information), or usability (such as a page that loads too slowly). You’ll be able to see your bounce rate by analyzing your website data through Google Analytics and create appropriate data-driven strategies from there.
It’s important that you make an effort to keep your bounce rate low because, if it’s high, this can signal to search engines that you aren’t providing value for your website visitors. This may lead Google and other search engines to dock your keyword and page rankings.
One of the most common reasons websites’ bounce rates can be high is that the wrong keywords are targeted on their web pages. This can mean that people are presented with content they weren’t expecting when they click through. So, when you’re writing website copy, ensure that you’re always incorporating the most relevant keywords that reflect what is likely to be the searcher’s intent.
One of the most important things you also need to remember is that you should be targeting commercial keywords—those with a high purchase intent—on your product or service pages and informational keywords in your website copy and blog content. This will help ensure people land on the page they’re actually looking for. People looking to purchase Widget A don’t necessarily want to land on a page with a complete history of how Widget A came into existence.
If Your Content Isn't Getting Clicks, Change Your Strategy
Many businesses come up with a content strategy and stick to it—even if it doesn’t get them the results they want. Don’t make this mistake! If you’ve tested out a particular strategy and aren’t getting clicks through to your website, you might be creating the wrong type of content or not promoting it well enough.
A common mistake businesses make is that they focus on churning out new content all the time but don’t make an effort to ensure it’s actually going to provide value for their target audience. By using data, your agency crafts content that resonates better with the target audience to improve engagement levels.
Use Audience Analytics to Target the Right People
If you want to ensure you’re attracting the right people with your content and marketing campaigns, you need to pay attention to your audience analytics. This helps your agency refine the target audience, as you’ll have a better idea of which demographics you’re currently reaching, how people tend to find your client, and more.
One way to collect helpful audience data is with a social media analytics tool. After all, if people follow your client’s social media accounts and engage with their posts, it’s probably because they’re interested in what your client is selling.
Social media analytics software can provide your agency with information about the demographics of your followers, what times they tend to be online, and — most importantly — what kinds of content, products, and posts they’re most interested in.
For example, with a custom social media dashboard, you can use data visualization tools to quickly analyze audience demographics data such as age ranges, top countries, top cities, and languages for each social platform you're using:
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Once you’ve collected all of the relevant data about the audience, use it to create accurate buyer personas. These represent who shops at your client’s company the most (or who you’re trying to attract).
Look for trends in the data like the customers’ gender, age, location, and spending habits to start. It can also help to conduct customer surveys to learn more about the people who already shop with your client. The better you understand the target audience, the better you’ll be able to market and appeal to them.
Consider Whether You Should Take a Localized Approach
Next, look at location analytics to figure out where customers or website visitors are based. Using local marketing reports keep your agency informed about large proportions of an audience in one area or even in a number of locations. A localized content and marketing approach could be very fruitful.
Use Customer Journey Data To Optimize Your Touchpoints
Collecting data that will help your agency better understand the customer’s journey is important. Think of this as a roadmap consisting of every touchpoint an individual goes through when interacting with your brand, before, during, and after a purchase.
For instance, where do your clients' customers find them? Through social media, search engines, or related websites? How many of them come back after making an initial purchase? These are the types of questions you need to ask yourself as an agency when analyzing your clients' customer journey. It’s a good idea to collect data like this to determine what touchpoints you need to focus on optimizing.
To find these data points, it could be helpful to conduct a survey with people who have made a purchase with your business. Ask them how they found your business, what made them decide to make a purchase, and how likely they would be to make a purchase in the future.
Once you have your customer journey data, you’ll be able to identify the roadblocks your customers often come up against and the concerns they might have before buying from you. You can find out if your customers are achieving their goals on your website, where the main areas of friction are, and where people are abandoning their purchases, then work to fix the issues.
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Best Practices for Data-Driven Marketing
There is no one-size-fits-all answer when it comes to the best practices for data-driven marketing. However, some common recommendations include segmenting your customer base, using customer data to personalize messages and content, and using A/B testing to optimize your campaigns.
Additionally, having a clear goal in mind for your data-driven efforts and tracking the key marketing metrics that will help you measure success is important.
The best practices for data-driven marketing include:
1. Define Your Goals and Objectives
When setting goals and objectives, it is important to take a step back and assess what you want to achieve. Once you understand your desired outcome, create specific and measurable goals that will help you track your progress.
2. Collect Accurate and Reliable Data
Collecting accurate and reliable data is essential to any data-based project. You’ve likely heard the saying, “Garbage in, garbage out.” This applies as much in data-driven marketing as it does anywhere else.
Without good data, your agency won’t be able to make good data-driven decisions. There are many ways to collect data, but not all methods are equally effective. The most important thing is to choose a method that will produce the best possible results for your client.
One common way to collect data is through surveys. Surveys can be administered in person, by mail, or–most commonly these days–online. They are typically used to collect demographic information or gather opinions from a large group of people.
Another popular method for collecting more qualitative data is through interviews. Interviews can be conducted in person, over the phone, or via email/chat platforms like Skype, Zoom, or Google Hangouts.
3. Thoroughly Analyze the Data
Data analysis is a process of inspecting, cleaning, transforming, and modeling data to discover useful information, inform business decisions, and solve problems. Data analysts use various techniques to examine data, including statistical methods, data mining, and machine learning. The goal is to summarize data in a way that makes it easier to understand and use.
4. Clearly Report the Data
Having all of this data is of limited use if it remains as a jumbled pile of numbers. Make your marketing agency more productive by creating simple yet effective ways to track and report the data for your internal teams and clients.
For example, measuring sales, campaign performance, website analytics, phone calls, and more helps you track and report how you are using data to reach client goals.
5. Follow Data Privacy Compliance Laws
Data-driven marketing has become increasingly popular in recent years, as businesses have realized the potential to use data to better understand and target their customers. However, with this increase in data usage comes an increased risk of violating privacy laws and regulations. To ensure the success of your data-driven marketing efforts, it is important to research these laws and make sure your business is compliant.
There are a number of federal laws that regulate how businesses can collect, use, and store customer data.
The General Data Protection Regulation (GDPR) is one of the most important compliance regulations to be aware of. This regulation was put into effect in May of 2018 to protect the data of European Union citizens.
The GDPR applies to any business that processes or intends to process the data of EU citizens, regardless of whether the business is based inside or outside the EU. If your business processes the data of EU citizens, you must comply with the GDPR’s strict regulations surrounding data collection, storage, and processing. And the California Consumer Privacy Act (CCPA).
Google's intention to phase away third-party cookies in Chrome, the largest desktop browser by far in terms of market share, should be widely known by now.
This shift will greatly impact agencies and clients that rely heavily on third-party data to scale broad portions of their campaigns. If this is you, and you haven't previously audited and diversified your offers, now is the time.
Targeting and retargeting new clients on the web will need agencies to strategize about replacing third-party cookie technology with alternative ways and/or adjusting other efforts in the short, long, or both terms.
6. Understanding the Difference Between Discrete and Continuous Data
When creating client reports, there's a waltz we like to do with both discrete and continuous data. You see, discrete data–those countable, integer types–provide solid, numerical insights like site visits or total sales.
Meanwhile, continuous data, the fluid dancer of the duo, offers granular, ever-evolving information such as percentages or time-related metrics. In the dance of discrete vs. continuous data, both partners play an essential role in creating a comprehensive and intricate performance of data analysis.
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Using Data To Improve Your Marketing
This article outlined how to use data to refine and optimize your digital marketing strategy.
Just by running a website and having the right data-driven marketing tools set up, you have a wealth of information at your fingertips at any given moment! Follow these tips to use your data and analytics to consistently improve your digital marketing efforts and reach your business goals.
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