Marketing data has become an invaluable tool that can power decision-making but is also an organizational challenge to get right. After all, deep customer and automated marketing solutions need time, effort, and specific talents to implement and maintain.
With the collection and application of customer data, you get massive benefits —your company gets to know customers better while you can improve your processes—but it also comes with a series of logistical challenges to overcome.
Here’s a summarized version of the benefits marketing teams can reap from data and the challenges they have to solve to make it happen.
Important benefits of data collection and application in marketing
- Know your customers and build more profound databases
From knowing their preferred communication channels to understanding how they feel about specific topics, data allows you to create profiles with the information you need to cater to individual preferences. After you’ve gathered enough individual profiles, you’ll build a database you can use to:
- Analyze behavior patterns based on demographics, age range, shopping history, etc.
- Manage omnichannel experiences more efficiently
- Make complying with privacy laws such as GDPR and CCPA easier since you have a clear view of what you know about your customers and what you plan to do with their information.
- Periodically gauge general interest in your brand.
And those are just a few of the most common applications for databases. For experienced marketers, a juicy database is a resource they can apply in almost every aspect of their work.
- Greater personalization
If you’ve been in marketing for a while, you’ve probably been hearing a lot about personalization for more than a few years now, but the fact is:
63% of consumers expect personalization when it comes to marketing, product suggestions, order confirmations, and any communications between them and the companies they interact with - 2019 RedPoint Global survey
As we saw in the 5 key trends shaping the CX and marketing landscape, contextual, relevant, and helpful personalization at a scale that elevates the customer experience is imperative for brands.
Not surprisingly, experts such as Jay Proulx, head of CXM at TMG, consider that “customers want to feel like brands understand them, are equally invested in the relationship, and are ready to personalize based on their recent interactions.”
Brands must combine analytics and automated management tools into a culture that champions data-driven decisions to provide the most personalized experience possible. And that’s not optional.
- Understand the market
Your customers' expectations are changing, and so is the way they interact with brands and shops." Understanding the market" is all about being aware of the large-scale trends your target audience follows.
eCommerce research shows how consumers are shaping the future with new patterns and expectations:
📱 Mobile preference: Consumers are more likely to use smartphones than laptops/desktop PCs to buy online.
🛒 We want VR: More people wish virtual reality to be integrated into online shopping.
👥 Preferences matter: 6 out of 10 say they want personalized experiences based on personal preferences.
💳 Shop 'til you drop (online): Consumers are feeling more confident in buying online from retailers they hadn't used before.
👥 Values first: 8 out of 10 say their values play a role in where and how they shop online.
💲 Price is still king: A clear, easy-to-find Price is still the most valued website feature.
🌐 It's all about your website: More people are revisiting websites multiple times before buying.
The shifting preferences of customers raise many questions for brands looking to compete.
Do your customers prefer using your mobile, app, or desktop site? Would they benefit from VR/AR implementations? Do they expect you to stand up for values such as environmental responsibility and transparent supply chains? Do they feel like you provide enough personalization?
The answers to these questions will help you understand the preferences of your target audience and adjust accordingly.
Determining whether your potential customers are doing this and developing strategies to convert unsure users into confident buyers will be a priority moving forward.
Now that we have gone over the most critical benefits of collecting actionable data let's talk about the challenges between brands and the data they need to provide the best customer experience.
Challenges of data collection in marketing and how to solve it
- Lack of automated integration
Even though data is the name of the game, companies need to overcome several challenges before they can truly harness it, and the lack of automated solutions is one of the most pressing.
Having no automated solutions to integrate data from multiple softwares and vendors leads to several problems. Three of the most important are: manually managing data, difficulties to measure ROI on marketing budgets, and having no single view of your metrics. Keep reading to learn more about them and the solution.
Problem #1 - Manually Managing Data:
A significant number of organizations, small and large, are still relying on manual data management for reporting, which is inefficient and time-consuming. It also increases the possibility of human mistakes and inaccuracies, reducing the value companies can acquire from data reporting.
It's such a prevalent problem that it's ranked #1 in a 2021 Adverity report about current marketing challenges, cited by 41% of the survey respondents.
This data fits in line with Adobe's 2022 Digital Trends report, which found that "poor integration between tech systems" is considered the main barrier is holding back customer experience by 37% of surveyed practitioners. This report also found that 42% of practitioners did not use unifying platforms despite using multiple technologies or vendors for customer experience management.
Manually handling data is a widespread problem.
Problem #2 - Measuring the ROI of marketing budgets
With such a widespread lack of automated integration tools and all the problems that come with manual data reporting, it is no surprise that measuring the return on investment (ROI) of marketing spend is a big challenge too.
If an organization cannot apply an efficient model for data reporting, its ability to provide current statistics will lag.
Problem #3 - No single-view of your marketing metrics
There are thousands of marketing solutions geared at different areas and specialties, which often means that your team’s marketing stack will look like dozens of charts from 10 or more different software solutions.
This leads to all sorts of problems when trying to make sense of all this data.
How to solve it? The solution to all three of these problems:
Naturally, the solution is to lean into automated integration marketing platforms instead of disparate specific solutions that leave us with unwieldy Martech stacks that don’t work well together, making complex metrics harder to determine, as the relevant data is not readily available.
An automated solution will give us the information to create unified marketing dashboards.
Customer Data Platforms are a valid option for these situations, as they are built specifically to solve the problem of data fragmentation, preventing data silos and minimizing or eliminating the business impacts of disjointed data.
Learn more about CDPs: Customer Data Platforms: Your Go-To Solution to Customer Data Challenges
- Struggling to keep up with the market
Marketing is ruled by trends and these trends tend to change unexpectedly based on a variety of internal and external factors.
Organizations need to be able to read the overall state of the market to identify and adapt to trends as they rise, but also to predict future customer and market behavior.
How to solve it? Artificial intelligence and machine learning solutions can help you stay ahead of the curve and up-to-date with all the data you need to respond to real-time events.
The automation of data analysis helps you create models for predicting what will happen if you employ a new tactic or what will happen if you stop using a current one.
- Adhering to data privacy laws
As awareness of the need for data privacy increases among both the public and institutions, marketing teams face more scrutiny for handling customer data. The regulations, combined with the impending deprecation of third-party cookies, result in a more fragmented internet with fewer data for everyone, which is excellent for privacy but adds a new challenge to marketers.
How to solve it? For both productivity and compliance, Martech stacks should contain built-in privacy capabilities to ensure all data collection and management occurs within the confines of relevant regulations, such as GDPR and CCPA.
The benefits are two-fold: it avoids fines and allows companies to operate the most efficiently while staying true to their legal limitations.
Despite fragmentation and regulations, there’s no doubt that most organizations now have access to an abundance of customer data.
Data has become the name of the game, forcing brands to either adapt to this reality or struggle to stay relevant.
While the benefits of efficient and responsible data management are many, so are the challenges to overcome before we can reach that state.
A full commitment to customer experience and the flexibility to change priorities as the marketing landscape changes is necessary to compete and thrive.
If you don’t have the right infrastructure or talent to implement your customer data strategy, it is time to start thinking about it.