Hot Tip

Data-Driven Marketing or Marketing-Driven Data?

The relationship between marketing and data isn’t always clear cut, so we wanted to share our approach by way of illustration.

Let's say a database report shows that a subset of customers is very price-sensitive because they historically spend less when there are no “price off” specials.

• One way of using this data is to act directly on the findings in order to isolate and try to “lift” this group.
• However, approaching this data from a broader marketing perspective, we would want to see if this is a “trend” that could suggest that discounts are becoming an important reason for purchase (notwithstanding values such as quality, convenience, selection, and service)—and therefore the focus on offer rather than value would likely further denigrate the brand. A frequent “price off” strategy could devaluate the brand with some customers and spread to others negatively, destroying margins. The gains in new customers and revenues from the “price off” approach may be more than offset by the losses in profit margins, not to mention brand equity.

• The marketing-driven data approach came away with a different conclusion than the data-driven approach.  This solution focused on how to turn the situation around (via media, positioning, messaging, and promotions)—and while doing so in a way that protected sales volumes and gradually restoring profit margins.

Seeing data from a more comprehensive marketing perspective rather than focusing on the data alone may require less obvious, but ultimately more beneficial solutions.

Bite-Sized Chunks

• Branding "Delivery" and advertising success: The internet/other technology platforms are giving consumers more control over how they and others will position/interact with your brand.  Companies can, however, gain more control over how consumers position them by taking a closer look at “brand delivery”, or the genuine delivery/over-delivery of the brand’s promise to the consumer. Reevaluating “brand delivery” is a worthwhile exercise that can lead to an increase in customer satisfaction and greater advertising success.  In other words, “brand delivery” is more important to advertising success than advertising is to brand success.
• Find hidden opportunities in details: There are many potential layers of measurement across targets, markets, offers, tactics, sales channels, spends--and these can be measured in combination and in context so that learning is actionable.   To get to the cause/effect on the execution side, we need to know response performance for elements in combination.
  • Quick example:
    • Internet campaign and “Offer A” had “overall soft” performance but “Offer B” performed very well. The conclusion could have been to drop “Offer A”.
    • However, a deeper analysis showed that “Offer A” outperformed “Offer B” but only with Hispanics.
    • Therefore, if the first conclusion were the only finding, then an opportunity to target and grow Hispanic sales might have been missed.
• Visualize before you analyze: The best marketing solutions begin with a clear picture of where you want to be in the end.  Start with the end product or deliverable you have in mind.  The end product could be a road-map to accomplish "X" or an integrated tool that empowers you to do "Y"….or a target audience made up only of "Z".  Rough out what you want to get, what you want it to do and what it might look like.   And assume throughout this creative process that resources will not be an obstacle.   After this step, determine which specific resources, including data, are needed to make it a reality.   There will be adjustments along the way, no doubt, but the end product should be the result of "marketing-driven data" at its very best.