Online, customer data is one of a company’s most valuable assets. However, as most marketers know, collecting and analyzing customer data is complex and inefficient.
Companies have plenty of data at their disposal. But if you ask online marketers important questions, such as what their conversion rates are; where their customers drop off; what the successful components of their marketing campaigns are; or how their customer segments respond to specific offers, they often don’t have answers. What they do have is large amounts of irrelevant information that leads them to make decisions that poorly impact their business.
Most companies sit on an enormous pile of information related to their clients. It resides in their analytics or CRM solutions. It’s often related to an instinctive inclination to collect a large quantity of data, which we then try to make the most of to craft more intelligent decisions.
Regrettably, this information stockpile can lead us in the wrong direction if data quality doesn’t match quantity. The information collected should be there to support the conclusion you’re trying to reach, not lead you into analysis that isn’t valuable to your business. Don’t follow the trend of putting in place a huge, expensive system that bombards you with data and overwhelms you with information. You’ll only lose valuable time and effort.
Be Clear on End Goals
You should have a conclusion in mind before you begin collecting data. Do you want to predict future purchase behaviors? Do you want to understand the impact of your campaigns on your customer segments or demographics? Do you need illumination on order abandonment?
Identify Required Analysis
Once you know the conclusion you’re trying to reach, think about the analysis necessary. The questions you should first ask are: What am I really trying to accomplish? What kind of analysis must I perform to reach my conclusion? Should we test and, if so, on which dimensions?
Identify Specific Data Required
Now that you’ve defined both the objectives and the type of analysis required, move toward the specific data you need to achieve those goals. Put yourself in the shoes of the person collecting the data. Figure out every specific data point you’ll need. Where will it be collected? How often? In what format?
Make sure to get IT and database personnel involved as soon as you have a clear picture on the analysis and data. They’ll help figure out whether your requests are realistic and what tradeoffs must be made. They’ll ensure the data collection process is in place before the campaign is launched.
Too often, reporting requirements are an afterthought. As a result, we don’t have the relevant information to help understand the impact of marketing actions and lessons we could learn for future campaigns.
Don’t spend hours trying to manipulate data to draw conclusions that could lead you in the wrong direction. Don’t buy expensive analytics tools or CRM solutions before you understand what information you require. You’ll lose the big picture, spend a fortune, and get frustrated in the process.
Start by thinking about your objectives, then build data collection in a collaborative way. You’ll use your time and energies efficiently, gain tremendous knowledge, and save your company a lot of money in the process.
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