Your whole strategy is based on making data-driven decisions. So, before launching any campaign, product, or strategy, it’s important first to analyze your data and pull out relevant insights. Otherwise, you’re sending marketing campaigns out into the world without anything to back them up, hoping and wishing that something will stick.
“Marketing without data is like driving with your eyes closed.” – Dan Zarrella.
The best marketing campaigns are often the ones that use data to back up the decisions. Data-driven marketing happens when we gather insights and trends by analyzing data and then translating the insights into actionable decisions – all informed by the numbers in the past and present campaigns.
Improving your decision-making with data starts with knowing what data to use and how to use it. We’ll get into that a bit further down, but let’s first unpack the role that data plays in marketing and decision-making.
Without data, marketing would be a guessing game.
The primary role that data plays in marketing is to improve decision-making. Data tells a marketer or a business owner whether their efforts are working or not. This is why it’s crucial to make data-driven decisions.
So for a campaign, product launch, or strategy to be successful, a business needs to use data analytics technology to track each step of its growth journey.
Data analytical capabilities allow a business to establish consistent data collection, aggregation, and analysis. That consistency unlocks the opportunity for continual growth as it offers foresight of where the company is going.
Your data not only tells you how successful (or not) your marketing is, but it can also reveal new opportunities. For example you can find new revenue streams, market segments, and client demographics to explore.
Here are some real-life examples of data-driven decisions:
A great example of using data comes from e-commerce giant Amazon. It uses a so-called dynamic pricing model to adjust their prices up to 2.5 million times per day. They collect data on competitor prices, shopping patterns, the popularity of products, and the commonality of products, along with a host of other data to provide their customers with competitive prices and strong product recommendations.
Google, where fact-based decision-making is part of their DNA, is another excellent example with their People Analytics Department, which they use to make HR decisions using data. The exciting thing here is that this includes decisions if managers make a difference for the performance of their teams (spoiler alert: turns out they do).
It’s incredible what insights and trends we can find in data and the results they bring; but, processing a lot of data can get overwhelming. However, that shouldn’t scare you, though; it just means that you need to figure out the best way to manage this information. And that starts with knowing what data to use.
You don’t need every single bit of information or statistic to make data-driven decisions
While you need data to run successful marketing campaigns, there is also such a thing as having too much data.
As you see, businesses now have access to a myriad of tools and platforms for all kinds of capabilities. Plugging your business into too many of these tools and platforms only leads to one thing: data overload. So it then becomes easy to get distracted from what data is essential to track.
The easiest way to avoid data overload is by identifying business-critical priorities and objectives related to a specific purpose. Your purpose should answer the question, ‘why are you collecting this type of data?’
Having a clear idea of your business objectives and marketing goals helps you know what to track. This way, it’s easier to avoid collecting too much unnecessary data and simplify making data-driven decisions.
Growth marketing strategy starts with solid foundations
Managing data overload starts with building strong marketing foundations, including knowing what to measure.
There are many facets to building solid foundations, and it’s essential to consider all of them. You want to adopt the correct principles early on to help you unleash your data intelligence and analytics power later.
Where’s the best place to start?
Start with understanding the areas that need your focus. After this, look into centralizing your business data using the right digital tools and technology.
Centralizing your data allows your business leaders to have a complete overview of how the business is progressing. It also gives your employees the chance to make faster, more intelligent data-driven decisions that impact the company positively.
Finally, adopting a truly holistic approach will help you to set a strong data foundation. It’s better to design and build your data framework in such a way that everything, including data, tools, platforms, people, products, and services, works as a whole to achieve the best business outcome.
Five steps to optimizing your data for decision-making
Adopting a holistic approach and focusing on the macro conversion metrics that relate to the general business goals, not the micro metrics, will simplify making data-driven decisions for a business owner.
The challenge here is to go from the details to the general macro conversion metric to use the data to guide future decisions.
Here are five steps to optimizing your data collection and analysis for better decision-making:
Goals and strategy
Identify how data can help you achieve your business goals. For example, are you looking to improve the conversion rate? Do you want to target a specific audience? Or, do you need to increase your email click-through rate?
Once you’ve identified your goal, start building a strategy around it. From there, decide which data you’ll need by the end of your process so you can keep track of the right metrics throughout it.
Set your metrics
Pick the metrics that directly support your goals. Less is more at the start. If you want to add additional metrics, first ask yourself what important information it provides and if you can do without it?
The amount of data that you can collect can be enormous. But, don’t worry, you don’t need THAT much. The trick is to pick what matters most for your current situation. It’s always better to start small, focus on immediate needs, and grow your capabilities with time.
Collect and analyze data
Now that you know which metrics need to follow, you need to determine how to keep track of them. Again, the important thing here is not the tool or the device; it tracks the correct information, data, and metrics.
A few of the tools that we use at Insights Lab include:
- We use tools like Hot Jar and VWO for marketing experiments and user behavior tracking.
- Google Analytics for quantitative analytics when it comes to getting rich insights about a site and its audience.
- HubSpot is a tool to attract, engage and delight customers, and a marketing tool and CRM.
- Google Tag Manager for the event and conversion tracking.
- The Search Console by Google for search traffic analysis and performance.
- ActiveCampaign for email marketing and much more.
Remember, data is only helpful if you know what it represents, so the person in charge of handling it needs to know how to analyze and translate that data correctly. Also, remember to add context to data to get the complete picture.
Analyzing data and turning it into insights, and concluding is the first part of good decision-making. The second is turning those conclusions into actionable insights or perceptions that drive you to rethink your approach or take action that positively affects your business growth.
Rinse and repeat
Analyzing data never ends. It just keeps getting more refined as you start adding layers of additional metrics to track. Tracking your campaigns, product launches, and strategies should become second nature, which is simply part of the process.
The more you use your data to aid your decision-making, the better your marketing will become. Remember, data is a tool that should simplify decision-making, not complicate it. So, avoid collecting too much data as it usually ends up causing more confusion than providing value. If you’re having trouble setting up solid foundations for your data collection, get in touch with us at Insights Lab. Building solid foundations and analyzing data is what we do best!