Three tips for using data to drive your marketing: get it, manage it, use it.
Get it: obtaining the right data
What sort of data do you need? This decision should be guided by how you intend to use data now and in the future. Today you might simply need customer names and email addresses. But think ahead; in future you may wish you had collected details of people who enquired but did not purchase; or you may regret not collecting information such as birthdays or ‘how heard’ data, so that you could, for example, analyse how different age groups heard about your business and its products or services. For tips see Royal Mail’s What data do you need from your customers?
When planning data requirements there are legal obligations to consider. You must collect data with a purpose, which in essence means having justifiable reason to collect the data; and your data requirements should be relevant and not excessive. Knowing what data you want and why is thus important from both a legal and strategic perspective. Your legal obligations are outlined in the eight data protection principles.
Now you need tactics for acquiring data. Point of purchase is an obvious route to obtaining basic data such as names, addresses and email addresses. But you may need additional approaches to get more detail. Often a key aim of incentives such as vouchers or loyalty cards is to encourage customers to share data. Examine existing points of customer interaction to see how they could be used to acquire data, or devise entirely new ways to obtain it.
Whatever your collection methods, you are legally obliged to tell individuals what you intend to use their information for. Customers are entitled to ‘opt-out’ of receiving marketing communications and must be provided with a means of doing so, and they must ‘opt-in’ before you are allowed to share information with other companies. See Using personal information fairly and lawfully.
In addition to obtaining data from existing contacts, you could purchase data lists of potential new prospects. Subject to the right permissions, such data could be used for postal, email or telephone marketing. Be sure to work to the standards set by the law; see Developing your customer database.
Manage it: storing, cleaning and updating data
As with data collection, getting data storage right is important for both strategy and legal compliance. If you don’t choose the right data storage system you might experience future limitations should you wish to, for example, add new data fields or run custom data analysis and reports. In addition, if you don’t store data securely and for no longer than is necessary you might breach the data protection principles; also see Keeping your systems and data secure.
Out-of-date data carries costs which could outweigh the expense of ongoing quality and cleansing processes. Removing gone-aways, such as contacts who have moved home or changed telephone number, saves expense and waste, and continually working to update data and add missing detail could improve marketing analysis and targeting. Data quality and cleansing could thus be used to both clean up and plug gaps prior to marketing activities.
Use it: turning your data into meaningful marketing activities
You are collecting the right data and trying to keep it up-to-date and comprehensive; now it’s time to turn this intelligence into effective marketing, by using it to profile, segment and communicate.
Analyse your data and profile your audiences by considering questions such as: Who is your typical customer? What’s the profile of your most/least valuable customers? How frequently do customers purchase? How do most customers hear about you? There are many other such questions, and the answers can often lead to more. But fundamentally – try to use data to answer your most pertinent marketing questions.
By getting to grips with your data you could potentially segment customers into different groups. For example, some customers may tend to interact via the web or email, while others interact in person or respond well to direct mail; such insights could allow you to create distinct communications strategies for different customer segments.
Customer data equals customer intelligence. This intelligence could be used when talking to customers one-to-one, or used to segment customers so that you can talk to different groups differently. In general, think about how marketing needs can lead your data demands, and how customer data can inform and lead your marketing.
More info – Guide privacy and data protection in direct marketing
More info – Guide managing your customer database