New research from the Data-Driven Marketing Institute outlines the scope and flow of data through our data-driven economy.
Marketers instinctively know the value of marketing data - it's the fuel that drives relevancy, engagement, response and ultimately: Revenue.
However, it's hard to find the hard, cold facts around what, exactly, that data is doing for our industry and the economy. New research from the Data-Driven Marketing Institute, a think tank of the Direct Marketing Association (DMA), outlines the scope and flow of data through our Data-Driven Marketing Economy (DDME). (Full disclosure: I work for DMA.)
The Value of Data: Consequences for Insight, Innovation and Efficiency in the U.S. Economy shows that yes, the Data-Driven Marketing Economy is big--and has big impact. There are some surprising aspects, though, which may provide inspiration and opportunity for your business.
First, the facts:
The report was conducted for policy conversation, not necessarily marketing purposes. However, I see three primary areas of import for marketers here:
Proving the Value of Data-Driven Marketing
First, proving value internally and ensuring investment is commiserated. "Data" in the report is not necessarily only digital. The study investigated many different sectors and found value being added in many ways that vary from rented lists of prospects, audience segments assembled by online publishers, personalization of direct mail offers, and all forms of delivery (e.g.: USPS sorting machines, Facebook servers, variable data printers).
In this way, the authors focus on the scope of our data-driven economy, not just the scale. As marketers, our task is to understand the value of individual data to our business so that we can invest properly, protect it and steward the responsible use of it.
Consider the impact of marketing data in:
Demonstrating the Value of Data to Digital Channels
One of the more surprising and counter-intuitive findings of this report is that a large, even disproportionate amount of the data-driven economy is takes place in the off-line, non-digital economy. The authors account for this by explaining that the fees associated with audience classification and assembly in the offline world are significantly higher, not that digital channels are any less data-driven. The authors find that the comparison of email marketing and direct mail helps "illustrate a general insight into the overall efficiencies produced throughout the DDME."
The report finds, "Email's virtue is that the marginal cost of delivery is virtually zero. Yet the study found its net value added at $1 billion, suggesting a paradoxically low level of expenditure by marketers on such an inherently attractive medium. By contrast, direct mail with its reportedly lower return on investment was found in this report to have a net value added of an order of magnitude larger than that of email."
Moving Conversations from Fear to Fact
Third, we need to protect our data-driven way of life. In our increasingly pressured policy environment, where Congress, state legislators and regulators want to restrict marketers use of data for marketing purposes, this study also definitively shows that regulation restricting the responsible use of data would impact innovation, small businesses, jobs and economic growth... and harm the U.S. Economy.
Check out the full study and share your impressions of the findings in the comments.
This Year's Premier Digital Marketing Event is #CZLSF
ClickZ Live San Francisco (Aug 11-14) brings together the industry's leading practitioners and marketing strategists to deliver 4 days of educational sessions and training workshops. From Data-Driven Marketing to Social, Mobile, Display, Search and Email, this year's comprehensive agenda will help you maximize your marketing efforts and ROI. Register today!
Stephanie Miller is a relentless customer advocate and a champion for marketers creating memorable online experiences. A digital marketing expert, she helps responsible data-driven marketers connect with the people, resources, and ideas they need to optimize response and revenue. She speaks and writes regularly and leads many industry initiatives as VP, Member Relations and Chief Listening Officer at the Direct Marketing Association (www.the-dma.org). Feedback and column ideas most welcome, to smiller AT the-dma DOT org or @stephanieSAM.
The Marketer's Guide to Customer Loyalty
Customer loyalty is imperative to success, but fostering and maintaining loyalty takes a lot of work. This guide is here to help marketers build, execute, and maintain a successful loyalty initiative.
The Multiplier Effect of Integrating Search & Social Advertising
Latest research reveals 68% higher revenue per conversion for marketers who integrate their search & social advertising. In addition to the research results, this whitepaper also outlines 5 strategies and 15 tactics you can use to better integrate your search and social campaigns.
August 21, 2014