As the path to effective marketing becomes increasingly technical in nature, the responsibilities of chief marketing officers are changing. To stay ahead, CMOs now need to leverage tech and data to get the right message in front of the right customer at the right time and measure the outcomes of their marketing efforts. But how can they ensure these tasks are being accomplished effectively?
The answer is data science. Marketing is now an inherently data-driven field, and marketing data is more widely available than ever before. Used correctly, data science can be a game changer for CMOs looking to develop successful marketing strategies. Below are six ways to optimize your marketing through data science.
Optimize your budget
Utilizing a budget to its fullest extent can be tricky and time consuming. A data scientist can use your spend, impression, and acquisition data to build a model that will handle this process for you. A model can balance how you distribute your budget across channels, locations, campaigns, and mediums to optimize for your key metric, whether that’s brand reach, ROI, or CPA.
Market where it matters
Too often, marketing campaigns are too broadly distributed. As a result, they become inefficient for your budget and goals. But if you utilize your data properly, you can understand which demographics and locations are giving you the highest ROI.
For local marketplace businesses, a data scientist can look into network effect. This effect occurs when one side of your market influences and grows the other. For example, your buyers may be spreading the word to other buyers, and your sellers may be bringing in new buyers on their own. Take advantage of these relationships by incorporating them into your marketing strategy. You may be able to reduce your marketing budget for either the supply or demand side of your market, and instead see the growth happen organically.
Match strategies to customers
Make marketing campaigns more effective by delivering them to the right customer. Using a customer lifetime value model, data scientists can segment customers by their behavior, not just their demographics. Apply retention strategies to users who are likely to leave your customer base soon; send referral codes to your highest value customers; send “buy more, save more” coupons to your most frequent customers. Utilize your customer data to its fullest extent by using it to customize your marketing campaigns and fit them to each customer.
Prioritize and align
With the wide variety of advertising platforms available, it’s difficult to know at first glance exactly which channels are working for your business. Using a time series model, a data scientist can determine and compare the kinds of lift seen in different channels. For example, your TV ads may be bringing in new customers, while your display ads bring back your old customers.
Next, dig deeper into each channel. Which specific creatives, times of day, and partnerships are bringing in the highest ROI? Using this information, prioritize and align your team’s efforts on the mediums and channels that are working for you.
While there are global “high” seasons for consumers — the holidays, Black Friday, etc. — there also may be times specific to your business that can be prime opportunities for a marketing push. Using your transaction and page view data, a data scientist can use a time series analysis to examine these cycles in depth and give you further insight into the optimal times for your campaigns.
Analyze social data
Social media plays a huge part in advertising and marketing in today’s world. Each tweet, Facebook post, and Instagram picture, both from your company and from your customers, contains a goldmine of data. Using sentiment analysis, you can uncover how your customers are feeling about recent campaigns, announcements, and more, without the time-consuming process of reading through each post. Through discovery analysis, you can better understand who in the social media world is talking about your business, and which high-profile users are talking about your competitors.
Want to keep learning? Download our new study from Forrester about the tools and practices keeping companies on the forefront of data science.