Seven ways to create value from data
“Data must be turned into insight and action to be a source of customer, competitive and marketing advantage. Data is the bedrock upon which successful research, segmentation, marketing automation, targeting and personalisation are built.” –eConsultancy, Modern Marketing Manifesto
In recent years, businesses large and small have invested big budgets in data gathering software and hardware in an effort to better understand and communicate with their market, and deliver greater sales as a result. But most haven’t achieved the return that they were promised! Why does this happen? Usually, it’s because of:
- Information overload! They’ve gathered far too much data, and have then become overwhelmed by what they have.
- Lack of real interpretation: They don’t analyse/interpret most of what they input.
- It’s just meaningless data: They don’t translate their raw data into information, knowledge, insight and value, and then apply it to their business.
So how do you go about creating value from data?
1. Always start with real segments.
Your segments must be based on customer needs and motivations.
2. Only target segments that care about receiving a tailored product offer.
If customers are content with what they are getting from you then creating additional value may be difficult (and not cost effective).
3. Focus on analysing the data about the unmet needs of your target segments.
Look at things such as customer complaints, customer satisfaction and their use of competitive products and services.
4. Analyse different/multiple sources of data.
Using one source of data will give you a degree of understanding. Using multiple sources (from quantitative and qualitative methods) will give you much greater insight.
5. Use your data to test your assumptions.
Consider how you think your market works and use your data to test your assumptions about your customers and their buying behaviour.
6. Make difficult decisions about your marketing mix.
Changing your advertising proposition or sales promotion strategy is relatively easy. But greater value often comes from the more difficult and costly changes to, for example, your product, its pricing strategy or the way that its distributed.
7. Be a team player.
Departments must work together to achieve your objectives. Creating value from data is really a cross-functional activity, so its success or failure will often be the result of how successfully the Marketing team, Sales department, IT (and R&D if you have one) work together to achieve the objectives.