By Ward Anderson, senior vice president of marketing sciences at RAPP
Today’s consumers are constantly bombarded with advertisements from every direction. A quick Google search reveals that the average person encounters between 4,000 and 10,000 daily ads — as if you needed data to back up your daily reality. The sheer volume is staggering, making it crucial for brands to cut through the clutter and capture the attention of their target audiences.
Effectively communicating with your target audience is the key to cutting through the clutter, and this is where a precision marketing strategy comes into play. By investing in audiences that find your content relevant, your brand can maximize its marketing efforts and ensure a worthwhile return on investment. Remember, it’s not just about casting the net wide but casting it where the fish swim.
The trick is identifying audiences who find your content the most relevant. By leveraging customer relationship management tools, you can gather valuable data and insights about your customers’ preferences, behaviors, and purchase history that will allow you to identify your right audience, laying the foundation of a precision marketing strategy.
Precision Marketing Strategy: Not Just a Theory
Most executives find that segmentation is crucial for growing profits, according to historical Bain & Company data. Brands that accurately identify and target their best customers witness remarkable results.
Why? Most of tomorrow’s sales come from today’s best customers. If you can identify who those individuals are, you can increase the probability of winning an individual’s next transaction.
Most organizations already have the power to target their customer audience — they just don’t realize what power they already have. Does this sound like your company? If so, you’ll want to use the steps below to learn how to use first-party data in marketing to launch your precision marketing strategy.
1. Identify who is purchasing your product.
Set up a data platform that enables effective analysis and allows for the identification of customer purchasing behavior. If needed, invest in a customer data platform to streamline data management, and thank me later.
Your first-party data platform is the foundation for your precision marketing strategy. And the bottom-line impact on your business will make the effort worthwhile. I have had the benefit of partnering with organizations that shifted from broad targeting strategies to investing in an omnichannel, first-party audience strategy. Incremental sales blossomed! Working media-driven sales grew by 50% when applying first-party audience strategies. Do not shortcut this process.
2. Conduct in-depth analysis.
While there is plenty of low-hanging fruit within your first-party audience, you’re only scratching the surface of the ability to harness the power of your data. You don’t need me to tell you there are many benefits of exploratory data analysis. A good analysis will help you understand who your best customers are and why they purchase from you. You’ll get a sense of how they’ve evolved, what factors contribute to their loyalty, and their hidden pain points.
The more data you have on your customers, the more you can learn about them and figure out why you’re losing some customers and winning others. Data also tells you what it takes to develop winning strategies for each customer. The “why” behind customer performance matters. A solid customer data foundation allows your analytics team to figure that out.
3. Identify the areas you want to “win.”
Information without application is hallucination. A thorough exploratory analysis without a well-built strategic roadmap is like hiking in the woods without a compass. (I may have just dated myself.) Conversely, building your strategy without a thorough exploratory analysis is like hiking in the woods with a map … from a different forest.
This step is about figuring out how your marketing efforts can improve. It could involve improving conversion rates for new customers, preventing the loss of high-value customers, or addressing the gradual attrition of loyal customers to competitors.
Use the insights gained from analysis to evaluate your business challenges and prioritize your focus areas. Then, use these priorities to inform the business roles and triggers you use to target customers. For example, if you have a one-and-done pain point, applying models that identify the best path to achieving a second visit for each new customer will help grow your core audience for profitable long-term growth.
Email marketing can be a potent tool in this regard, with statistics showing that for every $1 spent on email marketing, a return of $36 is generated. Moreover, having this additional piece of customer personal identifiable information enables targeted marketing efforts through other marketing channels, further improving profitable customer growth.
4. Develop and execute your plan.
Once you have identified your focus areas, create a precision marketing strategy plan that outlines the actions you will take to address those challenges. Be specific about how you will address each pain point or growth opportunity. The more detail, the better.
Finally, implement your plan systematically, ensuring you allocate resources and execute initiatives effectively to achieve desired outcomes. Clearly define roles and responsibilities for each task.
Your brand can rise above the noise by recognizing the sheer volume of ads consumers encounter daily and investing in audiences that find your content relevant. Is a 50% increase in your marketing-driven incremental sales worth the effort? Feels like a no-brainer to me.
When executed effectively, precision marketing enables your brand to combat customer attrition, identify tomorrow’s sales, and maximize your return on investment — ultimately leading to long-term success. In the bustling marketplace, where attention is a hard-earned currency, precision marketing is your brand’s investment in a future where your messages don’t just blend into the background noise but echo in the ears of those who matter most.
About the Author
Ward Anderson is the senior vice president of marketing sciences at RAPP. Ward is a seasoned practitioner of data science with over 15 years of analytics leadership experience who applies today’s advanced techniques with a keen eye on practical application. One of his favorite quotes is “lies, damned lies and statistics.” You will see this quote play out as he passionately pursues the art of uncovering what data really tells us while understanding that many of today’s business challenges require an analyst to uncover insights in a world of gray. Ward brings his broad experience of applying data science solutions from solving challenges in customer marketing, inventory management, supply chain optimization, corporate real estate and credit risk.
