90% of digital marketing is building a customer database

Digital marketing offers a huge number of media channels, devices, networks and platforms. Across these channels a vast array of data is collected. Today customer databases are the powerhouses and new drivers of digital marketing.

What are databases and why marketers need them?

Initially user data was necessary to power the delivery of content and information. Today it is used to enhance the experience of web users through the collecting and sorting of a wide range of information, personal, financial and behavioural. Databases today are immense, massive and complex entities needed to store and traffic of all the information that is collected. Even more complex systems are needed to make sense of it all.

loading database
loading database

Today we are in the realms of “big data”. So much data exists for different reasons and used in different ways.  A lot of which also enables marketers to enhance their targeting ability, consumer relevance and timing of delivering messages among others.

YouTube’s database of user and video data houses 45 terabytes (1000000000mb). Yet how about the world data center for climate that has a reportedly 6.3320000000000mb of data on a whole host of weather and atmospheric data.

Yet in theory a database can start as just a simple base of customers on a spreadsheet with basic customer information (perhaps just 0.012mb for you!). It is after all in the word “data base”.  Yet this is really where it all started.

Although big data is touted as the next big thing in 2013 doesn’t mean that it should be adopted as a concept and is not really applicable as a strategy in its own right. Companies should not generally suddenly make huge investments in technology to start frantically collating as much of their customers information as possible.

Business-to-business (B2B) companies need different information to Business-to-consumer (B2C) companies. They will also use it in different ways for different reasons. From giving their users service access to recommending products, or smarter advertising.

The fact is everyone is on the customer database building bandwagon- whether they like it or not!

And so they should be!

Owning customer and prospect information has never been so easy. The digital world enables personalised communication to numerous people at low cost. This was one of the key drivers that marketers took to the Internet at the rate that was seen in early ’00.

Yet for marketing communication to become personalised requires information- data.

Whether this is a contact form, email subscription, Google Analytics or customer purchase information doesn’t matter. The right data needs to be collected and used in conjunction with; communication to enhance marketing efforts, the website’s user experience, new product development, or whatever else might be useful.

Such is the reliance on this information to achieve pretty much any marketing goal, means that most of the time needs dedicating to it.

We estimate that within a year or so around 90% of a marketers time will be taken up by the collating, sorting, and analyzing customer data for use in marketing activities.

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How?

One step at a time.

A variety of data collection methods are in use today. Some, like the customer address book have been around for a long time. Others, like real-time browsing data or social engagement has just emerged as the next port of call for the more advanced along the road of using data for marketing purposes.

 

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Centralising customer data ensures it is potable and backed up

 

Regardless of what the data is, the database or warehouse for this information provides a centralised hub for this information. This central point enables the data to be used in different ways. Different devices perhaps, various marketing platforms, logistics systems etc. This is true and useful on any scale, whether you are an individual or international business.

Yet it still amazes me how few people own their own data though. A random survey of perhaps 12 to 15 mid-level marketers claimed that they didn’t own their own contact or customer data. This is let alone whether they were making sure that their clients own their customer data. Yet it is an area that is quickly forgotten.

We were planning on discussing the online politics surrounding ownership and development of database systems, but thought otherwise. Let us start at the fundamental starting point.

Let’s reiterate. If your customers and contacts only reside online and in social networks you do not own them!

The guide below should show you how to do this on LinkedIn. Linked is a service that has become synonymous with digital networking and contact development. Yet if LinkedIn disappeared tomorrow where would your customers be?

How’s the Rolodex doing on your desk?

The rolodex used to be the holy grail of a person’s network and customers, but has pretty much disappeared as it was transferred to its digital form.  A rolodex cannot be deleted or become corrupted as computer hardware fails however. Do you have your contacts backed up in one place (this is pretty much a customer database), safe on a device you own?

Understanding the need to have access to your customers introduces the idea of portability and ownership. Some services like Facebook are notorious at preventing the download and exporting of your contacts.

A moral issue arises around whether Facebook should be forced to allow people to download the information from their accounts, or whether there is an associated privacy issue with this action.

We believe that understand right circumstances and given the right permissions a network must allow people to access and be able to take their contacts off the service. Yet if they do so they are also responsible for it.

There are strict laws today around the misuse of personal data, especially that of a financial nature. With power comes responsibility.

With that warning let’s continue….

Downloading your contacts from LinkedIn:

To get started you need to correctly format a CSV spreadsheet then you can import it to google by:

1.Create a custom CSV file, or export the address book from your other webmail provider or email client as a CSV file.
2.Sign in to Gmail.
3.Click Gmail at the top-left corner of your Gmail page, then choose Contacts.
4.From the More actions dropdown menu, select Import….
5.Click the Choose File button.
6.Select the file you’d like to upload and click the Import button.

Links to import and access your contacts in Gmail:

First ensure that you assign the imported contacts to “all contacts”.

In the “all contacts folder” start at the bottom of the first page and select the contact in the list, so you only copy the contacts not the sidebar and other frames on the page. Paste into Excel or preferably Open Office (We hate Office). Do this for every page in your contacts list.

Now you should have your contacts name and email addresses in the right columns in a spreadsheet to sort and arrange as you wish.

We have given the Gmail example as, for a free, accessible to all email program it allows you to easily import and export your contacts, arrange them in groups etc.  This is useful in group communication and targeting.

However once you have an exported list of your contacts from the online sources you have been collecting them on (fewer the better), then you are able to begin segmentation. Contact grouping or segmenting within a spreadsheet program, allows the future use of this data in various ways and in different marketing channels like in an email distribution programme.

Social Marketing Strategy Application

The development of lists that segment web visitors is then the next stage that has the potential to deliver brilliant results if executed correctly. With the ease of remarketing today this effort allow marketers to reach potential customers with ever more granular messaging. We can help businesses become more relevant to their target audiences and help develop brand affinity .

As with everything in marketing, aims and objectives must be fully defined to ensure that the right data is collected. Once this has been established the right database needs building or renting to house this information.

A one man band building spreadsheets with potential customers contact information or Cocacola with vast arrays of purchase, personal and behavioural data is unimportant.  Only data relevant to your future aims will be a worthy exercise to collect.

A telephone-based dog treat mail order service will logistically need address information and purchase information for their customer database to assess the postage fee for fulfillment.  Yet collecting information on the type of dog the owner has alone leads to a whole new world of communicating with the company’s customers.  Providing information on whether the right size of dog coat is in stock, ensuring the variety of pet food is the correct etc. All this added value for one extra piece of data provides significant extra customer value and satisfaction.  It is also an opportunity to cross-sell and increase revenue.

An online retailer for digital products on the other hand will need email address and a variety of different security and financial information for processing and security.  Yet understanding whether the person bought a music versus a video product is a simple differentiation that doesn’t even need extra information being filled out by the customer. A smart database should be able to differentiate an SKU code (product idenfication number) in relation to what kind of product was purchased. This allows for tailored newsletters with related content like latest music deals, new releases etc. Thus making the company’s offering and marketing more tailored and personal. Loyalty and repeat purchase is much more likely with a small additional segmentation and correct application of existing customer data.

The key is to be able to make sense of the data and use it in a smart way that adds value to customers. This can then be used as a differentiating factor and marketing hook in its own right.

The key is to avoid collecting unnecessary for a customer database, as this impacts on the user journey and reduces the number of people likely to fill in a form.  Research suggests that data collection even in exchange for useful content reduces the amount of people to access the information by up to 20 times.  No one likes giving person information, nor filling out lengthy forms.  A clear value and reason is needed for people to willingly provide this data.  The risk a potential customer will drop out of a purchasing process can be high if mismanaged.

For social marketing in-depth knowledge (school, date of marriage, music tastes, group affiliations for example) might be used in various ways. The most important thing is to use the data correctly and to take small steps to avoid an overload.  This also enables companies on the most important data for their business and avoid hefty database building and maintenance fees.

If you have any comments as to how your business is building a customer database effectively or thoughts on social/ digital marketing strategies that can result from data then please comment below!

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