Big data analytics has been a buzzword in the online marketing sphere as of late. But what exactly is it? More importantly, why all the fuss?
Simply put, big data analytics is the method of collecting, studying, and interpreting massive volumes of quantitative and qualitative data that’ll impact the profit margins and ROI of any business. It’s a valuable resource used by marketers and business owners when making critical decisions, from launching a marketing campaign, developing a new product, or discontinuing a previously offered service.
In the past, only large companies use this because they’re the only ones that got the funds to acquire the technology and talent required for this.
Today’s marketing and business intelligence technology allows you to access massive volumes of data about your customers, sales, and ROI.
Why you should be using big data analytics
Plan more effective campaigns.
Analyzing big data allows you to uncover patterns and trends within your niche, giving you and your team a better understanding of where the market’s going. This helps you take away a lot of the guesswork in developing a marketing campaign for your products and services, and hit your marketing goals.
Get more customers.
The wealth of information now available has also made a significant impact on how your customers make decisions on what products and services they’ll buy. Ads and branded content no longer sway them. They prefer to do their own research and decide using the information they gather.
At the same time, your customers expect you to reach out and engage with them on a personal level online as one study shows.
Big data analytics help you and your team in those areas by giving you the nitty gritty details about your target audience and the journey they’d take to become a loyal customer. You can then use the data to come up with a marketing strategy that sends out the right offer at the right time to the right people, increasing your conversion rate.
Analyzing these data can also help you establish a lead scoring system you can integrate into your CRM. That way, your marketing team can pass qualified leads to your sales team when they’re hot and ready to make a purchase. Not only will this help make their job easier, but also increase the number of customers they’ll close.
Increase your customer’s lifetime value.
If you’ve been in business for quite a while, you know how fierce the competition is in today’s online marketplace.
According to a study done by Gallup, 71% of all your customers are likely to do business with your competitor if they get a better offer or service. That’s over two-thirds of all your customers!
Plus there’s the reality that not all your customers are created equal. It follows the Pareto principle, which states that 80% of your profits come from only 20% of your customers.
Source: Smart Insights
By carefully analyzing your existing customers’ data, you and your team can quickly spot those who fall into that elite group. In turn, you can come up with a strategy that’ll allow you to deepen your existing relationship with them. As a result, they’ll remain loyal customers that give you repeat business.
Common types of big data analytics
While there are some data that marketers monitor depending on their products and niche, there are three types of analytics all businesses keep track of.
This set of data analytics goes beyond how many products you sell or clients that signed up for your services. Sales analytics also gives you insights on opportunities you and your team can tap to increase sales and profit margins. It also helps you pinpoint underperforming channels, putting you in a better position to decide whether you should make adjustments or discontinue using the sales channel altogether.
If you’re selling a physical product, this is one big data analytics you must have on your list, especially if you’ve set up your business in different locations. The data you gives you a detailed breakdown of the movement of your various products across each of your retail centers as well as potential bottlenecks that may be present.
That way, you and your team come up with solutions to drive slow-moving products to minimize wastage and profit loss.
Of the types of big data analytics listed here, this is the most critical. In fact, marketing experts call this the centerpiece of your big data analytics.
According to a report published by McKinsey, companies that apply customer analytics in their marketing strategies get 23x more customers than their competitors.
Source: McKinsey & Company
And it gets even better because these customers are 9x more likely to become loyal, repeat buyers.
The reason’s simple: this set of analytics tells you specific patterns observed among your customers: how they act, what they do, and where they go before they make a purchase and immediately after.
Customer analytics also helps you find out if there are any changes to your customers’ behavior patterns so that you can immediately tweak your marketing campaigns and keep them effective.
More importantly, it’ll help you accurately segment your leads and customers. Not only will you send the right offers and content to the right people but also know which segments are the most profitable and worth giving the VIP treatment.
Should you be using big data analytics?
All these sounds great so far, right?
So why is it that not everyone’s applying big data analytics to their marketing campaigns?
Good question! And there are two answers to that.
First, big data analytics isn’t for everyone.
Yes, you read that right: not all businesses should be doing big data analytics.
Why? Because for this to work, you got to have a substantial database of leads and customers.
If you’ve just launched your business, you should first focus on getting your target market aware of your brand and products, and build up a customer base. Only after you achieve this should you consider incorporating big data analytics to your marketing strategy.
Another reason why businesses aren’t using big data analytics is that they don’t know where to start, much less how to do it.
If that sounds like you, don’t worry! Here are strategies and techniques to use big data analytics in your marketing campaigns.
1. Have the right mindset.
Whether you’d like to admit it or not, there are assumptions about marketing that you and your team have come to believe are facts. These include the belief that you can’t measure everything and that figures have to be 100% accurate so that they can deliver results.
It’s true. Not all of your marketing activities can be quantified. However, that doesn’t mean that they’re not going to help your marketing campaigns bring in more customers and profit.
Here’s the thing about using big data analytics: they’re not meant to be the end-all of your marketing strategy.
Instead, they’re there to serve as a guide where you’re supposed to go. At the same time, it’ll open your eyes to opportunities for growth and profit that you and your team may not have thought of.
2. Promote a data-driven culture in the workplace.
According to NewVantage Partners’ 2019 Big Data and AI Executive Survey, 91.6% of business executives say that they’re aware that Big Data and AI is moving at an accelerated pace. Of these, 87.8% recognize the urgency of keeping pace with this trend.
Yet, only 28.3% of them report that they’ve fostered a data-driven culture within their businesses.
This could be the reason why over three-quarters (77%) of them struggle implementing big data analytics in their marketing and other business operations.
All these numbers point to one thing: if you want to use big data analytics to increase revenue from your marketing campaigns, instilling a data-driven culture is a must.
For this to happen, you got to get everyone onboard, starting with those in the executive level. That means your investors and co-founders. Without their support, you can be sure to expect resistance as you implement the change, especially if you’ve been getting pretty good results in the past.
The best way to convince them is by presenting how this change will benefit your business is by getting their approval to do a test run, and present the results after. You’re more likely to get their support when they see a definite increase in your revenue and their ROI.
3. Choose the right metrics to measure.
One of the most prominent mistakes marketers and business owners make is spending a great deal of time monitoring vanity metrics like page views, site traffic, social media followers, and post likes.
They’re called as such because they make you feel good, but they do nothing to increase your profits or hit your marketing goals.
Instead, focus your efforts in collecting and analyzing engagement metrics.
That’s because they’ll tell you how well you’re marketing campaigns are attracting, converting, and keeping your potential and existing customers. These are the metrics that directly affect how much revenue you’ll make from your marketing campaigns and what your ROI will be.
While I’d love to give you a specific list of metrics you’ll track, these vary from one business to another.
The best way to find out which metrics you should be tracking is by asking both your sales and marketing teams. They’ll tell you the parameters that’ll help them pinpoint which leads are hot and ready to buy.
Of course, this will only happen if your sales and marketing teams are aligned with each other. Otherwise, you can end up tracking and analyzing big data sets that either side may consider as irrelevant.
As a business owner, you’ll need to make both teams understand that they need to work together, not against each other, to hit your set goals.
At the same time, you should serve as the mediator between these two teams by finding solutions to the challenges and roadblocks one team faces resulting from the decisions of the other.
Only after addressing these can you then sit down with both teams and discuss which metrics you should collect and analyze. That way, your marketing team can pass sales-ready leads to your sales team to convert to paying customers.
4. Make experimenting a habit.
Experimenting is a technique used by growth marketers where they come up with ways on how to tweak existing marketing materials or campaigns so based on the results they got from big data analytics.
A lot of marketers shy away from this because it sounds tedious and complicated. But it isn’t. In fact, some of the most successful growth hacks or experiments involve only a few minor adjustments.
Take the case of software and hardware provider, Telestream, for example. After a series of experiments, they found that adjusting the layout of their product feature page made this more appealing to their customers. Not only were they able to close more customers, but also got them to choose their higher priced offers.
As a result, Telestream boosted its revenue by a whopping 300%!
That said, here are some tips to make it easy for you and your team to run experiments using big data analytics:
- Focus on the short-term. Run your marketing experiments for a maximum of 90 days. This timeframe should be more than enough time for you to get some results for you to review and evaluate.
- Keep it simple. Because you’ll be running your experiment for a short period, make sure that it’s going to be something that’s not only easy for you and your team to do but also for your customers to take action.
- Change one variable at a time. When you make changes to one variable at a time, you and your team can quickly see how it impacts your conversion rates.
5. Build a big data analytics team.
The power of big data analytics doesn’t lie in the amount of data you collect. It’s in your ability to analyze the data and present it in a way that’s easily understood by everyone else. Only then can this help you come up with an effective marketing campaign that’ll increase your customer acquisition and revenue.
An effective and highly-effective big data analytics team is made of five groups of people:
These are the big data analytics team members that are in charge of making sure that you’re only collecting clean data.
Data scrubbers (aka data cleaners) inspect the data you collect and remove those that are either corrupted, outdated, or incomplete. They’re also responsible for correcting any typos they find in the information they’ve received and verify that it’s consistent across different data sets.
These big data analytics team members that go through the massive volumes of data across different channels to find those that’ll affect your marketing campaign’s success. That way, everyone else won’t get side-tracked or tempted to shift their focus towards vanity metrics.
Business solution architects
Business solution architects are those members of your team that takes the data collected and group them together so that they can be easy to analyze. They’re also the ones in charge of updating these data sets based on how frequent you receive the data.
As their job title suggests, they’re the ones that are responsible for analyzing the organized data. They’re the ones who’ll tell you where you’re currently when it comes to your set goals.
More importantly, data analysts are the ones that better understand your customer’s behavior patterns. They’ll also help you predict any potential changes in your buyer’s journey and make the necessary adjustments to your marketing campaigns.
Marketing campaign experts
Of the different members of your big data analytics team, your marketing campaign experts are the ones who’ll work closely with your data analysts. That’s because they’re the ones who’ll take the analysis and predictions presented and apply these to your current and upcoming marketing campaigns.
Ideally, you should have at least one person assigned for each role. However, a study published by the McKinsey Global Institute shows that there’s currently a significant data analytics skills gap. So not only do you have a limited pool of talent available, but you’ll also have to pay a premium rate when you hire them.
Hiring growth marketers is a cost-effective solution. Unlike traditional marketers, growth marketers are well-versed in developing data-driven marketing campaigns with one specific goal: to generate more revenue for your business.
6. Invest in automation tools designed for big data analytics.
Even though you got a brilliant team with stellar skills, the fact remains that analyzing massive volumes of data is a tedious and time-consuming job. Equipping them with the right automation tools will make it easier for them to do their jobs.
There are several marketing analytics tools that are available for you to use in your business. Each of them has its own set of strengths and limitations.
Here are some questions to ask when choosing a tool or platform for your big data analytics team.
Does it provide visual analytics?
Presenting the big data sets your team collects in graphs and charts makes it easier for your team to segment and analyze it. It’ll also save them loads of time because they won’t have to create these when they present it to you and the rest of the key decision makers in your business.
How easy is their onboarding process?
Time’s money. The last thing you’d want is for you and your team to go through hoops to integrate it with the other tools and platforms in your marketing stack and begin using it.
Be sure to check whether the tools you’re currently using can easily be integrated into the marketing analytics platform you’re considering.
Also, ask if they will throw in an onboarding session for your team when you buy their marketing analytics tool. That way, your team can quickly learn how to use and maximize the tools you’ve provided.
What other features does it provide?
As your business continues to grow, your team would need more features to collect and analyze vital data sets.
These additional features will usually be available when you upgrade your subscription plan. That means paying more. The jump in the extra cost to provide your big data analytics team these other features shouldn’t be too steep. This will ensure it won’t affect your business’ ability to stay profitable.
How much can you afford?
Often, business owners will make their decision based on the price tag. And while there’s nothing wrong with this, this shouldn’t override the other factors you’ll need to consider.
Be flexible when setting a budget for your big data analytics tool. It should be enough for you to get an analytics platform that’ll give you all the features your team needs, and then some.
At the same time, the price should also be low enough that paying the bill won’t be a pain.
In today’s Information Age, the problem isn’t acquiring the data you need. It’s suffering from a case of analysis paralysis because there’s so much data available.
A team with big data analytics skills and a robust set of tools will help you collect, organize, and analyze the right data. In turn, your marketing and sales team attract, convert, and close more customers and increase your revenue.
Your team’s analysis will also give you, your partners, stakeholders, and investors a deeper insight into your business. This will help you make better decisions on where to steer your business and marketing efforts.
Big data analytics is meant to serve as a compass for you and your team. It’s meant to guide you when creating your content and segmenting your leads and customers. It shouldn’t override other factors. After all, your customers are human beings. So don’t set aside building a trusting relationship with them and engaging with them.
Now, I’d like to hear from you.
Have you tried using big data analytics to your marketing campaigns? What results have you observed? What’s one tip you can share to others just starting out?
Share your thoughts in the comments below.