The Importance of Data – Now More Than Ever
Collecting Customer Data Can Significantly Improve Sales and Marketing Performance
As economies begin to reopen, it has become crystal clear that in the new landscape, business as we know it will look nothing like it did mere weeks ago.
Restaurants at 30% capacity. No fans at sporting events. Retail stores with limited foot traffic. Near empty shopping malls. A new set of consumer priorities and shopping patterns… The list goes on.
Faced with this new reality, there is one very significant action item that all businesses can and should enact which will help them build a foundation for growth and sustainability in the months and years ahead: Strategic Data Collection.
The Value of Data
Dun & Bradstreet’s 7th annual B2B Marketing Data Report (an excellent read, available at dnb.com) surveyed 500 businesses and uncovered some very interesting information that can be applied to virtually any business, of any size, in any industry.
The survey, conducted in November 2019, which means that the results are pre-COVID-19 but highly valuable nonetheless, found that 73% of companies are increasing their investment in quality data. It took seven years to get to this number but most mainstream businesses now realize the value of data and justification for expanded investment in data collection.
The study found that for companies that increased their investment in quality data, 100% experienced overall performance gains and 94% saw an improvement in sales and marketing performance. Of those that decreased their investment in data, 100% saw no improvement in sales and marketing, and 75% actually saw a decline in the performance of their sales and marketing initiatives.
Small Business or Enterprise – Put Data to Work
Quality data can contribute to corporate growth regardless of whether you manage a single retail location or an international consumer brand. However, activation of the data is where the actual monetization occurs and if the data you gather is sub-quality, your ability to trigger a positive impact on your businesses is hindered.
A business that gathers basic customer information such as an email address or a mobile number can be effective in the use of that data but expanding that data collection where possible into areas like customer interests, hobbies, travel patterns, and more, can lead to more informed and superior marketing initiatives when it comes to the targeting and timing of customized messaging to your audience. Data alone is important but the quality of the data you collect and its relevance to your business will play a key role in the effectiveness of making that data actionable.
What We Have Learned From eCommerce
Early on, eCommerce platforms understood the need to collect data at every conceivable touchpoint in the customer journey, a benefit of online business that traditional businesses and physical locations have been unable to match. Perhaps one of the best examples of this is the abandoned cart feature found on most e-cart platforms today.
An abandoned cart saver lets the retailer reconnect with the consumer pursuant to an incomplete transaction, in real-time. This action may occur through a pop up that says, “Hey, stick around and we’ll give you a 2 for 1 deal…” or a follow-up email that says, “Come back and we’ll give you an extra 20% off.“ According to Baymard.com, abandoned cart rates range from 60% to 80%. Online stores have the benefit of recovering 5% – 12% of these sales all through the use of abandoned cart technology. If physical retailers could do likewise and convert an extra 5% – 12% of every customer that walked into their stores it would have a huge impact on the bottom line.
However, physical retailers don’t typically have someone standing at the door with a 20% discount offer designed to keep a potential customer from leaving the store or as an incentive for the customer to provide them with personal data such as their name, phone number or email address. When you are about to walk out of a physical store without completing a transaction, the best you might hope to hear is ‘have a nice day’. Every customer that walks out is a data opportunity lost.
At the same time, that applies to every customer who actually completes a purchase in a physical location. Has the business collected relevant, quality data from the customer, or have they simply walked out the door after completing the transaction leaving the business with no way to reconnect with that customer?
Clearly, online businesses have a decided advantage when it comes to retaining the customer or gathering information through direct incentivization and it explains why in the current environment we can expect to see eCommerce stores look for ways to collect even more customer data.
What Can We Do As Marketers?
Marketers need to help retail (and online) clients create programs that incentivize customers to provide data that will help the business thrive. Obvious ones such as discounts, free services, contests, giveaways, and gift cards will all help customers provide the most basic of data that can help local businesses retain and attract new clients. But deeper, individual customization will become even more important as a tool to create loyalty among customers and visitors.
Inherent actions like emails offering standard discounts are a good first step. But to truly activate a higher rate of return on a basic email or similar outreach, a business wants to dive deeper into the offer customization process by collecting microdata such as customer preferences, interests, shopping habits, brand choices, and so on.
Personalizing the customer engagement with content that addresses the consumer experience at an individual level will become a much more critical component of the one-to-one marketing journey that customers are demanding, whether that be through a manual process or one driven by AI technologies.
Planning For the Road Ahead
Collecting data requires an additional commitment of resources at a time when most companies are simply focused on re-establishing a sense of normalcy.
Regardless of size, however, as businesses get back on their feet they need to start taking a much closer look at preparing and implementing a Strategic Data Collection plan that helps them better understand and connect with their clients at the most micro of levels.
The return will be well worth the time invested.