Targeting an ideal consumer segment by using the right data science to better understand what its buying intent will be, has just become more critical than ever for companies wanting to maintain and grow their brands competitive edge. Budgets have shrunk, and Chief Marketing Officers (CMOs) are turning to highly targeted, more tailored data science solutions in order to increase their ROI, attract and convert high-quality leads, all while retaining their current customers.
Gartners annual CMO Spend Survey may be alarming to many that are trying to regain momentum after 2020. The latest findings show marketing budgets are down to 6.4% of company revenues this year from being at 11% in 2020. This is the lowest level percentage of overall revenue recorded in recent history.
With fierce marketplace competition, shrinking budgets, and the phaseout of traditional targeting methods such as cookies, companies have no room for error when executing omnichannel campaigns. That is why brands are increasingly turning to first-party data and AI-enabled audience modeling tools to identify the right customer in the right market to reach their monetization, performance and scale goals.
Data Science at work
Take for example Bacardi, which launched a U.K. campaign to boost sales for its Bombay Sapphire gin. The company used a first-party data set of 10,000 anonymous identities who had visited its distillery or website. Bacardi targeted them with promotional offers and as a result, the campaigns engagement increased by 9%.
Chobani also put its energy into identifying existing customers among a much larger consumer segment of iced coffee drinkers. Why would a yogurt company want to expand into the ready-to-drink coffee market? Because its loyal creamer users would be the right target for such an expansion. How were they able to zero in on all the coffee lovers who also like Chobani products? They used smart audience modeling and identity resolution tools loaded with lots of first- and third-party data.
Here are three ways using the right data science can be successful:
Using the right data science to identify the ideal audience for your brand should be the cornerstone any marketing campaign. In fact 82% of marketers say (according to the State of Marketing Measurement report) their executives desire every campaign to be measurable. However, less than a third can effectively assess a campaign’s ROI. Leveraging data becomes key in providing such measurements.
Attract and Convert High-quality Leads
When your brand targets consumers that are already predisposed to liking your service or product, your messages are more likely to resonate and your conversion rates are more likely to increase. According to a Marketing Sherpa study, the conversion rate average for lead generation hovers between 5% to 10%. AI-enabled audience modeling tools, such as BDEXs Omnisource IQ Machine Learning, can help increase these numbers by identifying consumers who share the characteristics of your ideal existing customers. This, in turn, enables you to target them with personalized information across a variety of channels. Therefore, instead of trying to reach an entire market, your efforts are channeled to qualified leads.
According to McKinsey & Co., around 40% of Americans who changed their shopping behavior since COVID-19 also changed their preferred brands. Interestingly, brand switching doubled in 2020 compared to 2019. Understanding these audiences and their motivations is crucial for customer retention. Accurate identity and behavioral data offers the power to extract information, such as age or education; or behavioral attributes such as purchasing or spending habits. Data analytics offers insight required to evolve with customers and reduce churn.
Now with Google and Apple announcing plans to phase out their advertising IDs, marketers are going to have to think differently. Utilizing first-party data coupled with powerful audience modeling tools is likely to become the next best thing to gain an edge over the competition.
The BDEX Solution
At BDEX, we know that your data source matters. This is why we focus on quality and integrity of our data. As the largest data exchange platform in the United States, BDEX has more than 5,000 data categories and more than 1 trillion data signals coming from more than 100 data partners.
Our proprietary Quality Assurance Layer filters out bad data to empower marketers to make their campaign decisions based on the most accurate and actionable insights. Contact us today to learn more about our data platform and solutions.