Everything seems to be generating data nowadays: mobile devices, e-commerce transactions, Web browsing.
Savvy marketers use data mining, data visualization, text analytics, and forecasting to make more effective decisions and reach customers. But the savviest among them are innovating with fresh types of data—and attracting new business as a result.
Sensing Opportunity for an Upsell
“The data that devices collect are going to add all kinds of context to advertising,” says Chris O’Hara, cofounder of Bionic Advertising Systems, a digital advertising service. Marketers can know exactly where potential consumers are, the current time and temperature, and which of the consumer’s friends are nearby.
When might such factors come into play? O’Hara gives the example of sensors in grocery stores that can detect the items shoppers take off the shelves. That data, run through huge databases, enable marketers to instantly suggest—via tech such as smartphones or electronic shelf displays—other products for shoppers to add to their carts.
More and more, geography will help marketers zero in on demographics, says Kevin Lee, CEO of online advertising and marketing firm Didit. “Geotargeting is a great way to market not only at the hyper-local business level but also for national marketers looking to target specific demographic and psychographic groups,” he says.
Marketers have experimented for years with mobile geolocation-centered campaigns, primarily using couponing. However, since research shows that a whopping 72% of consumers say they’ll respond to sales calls-to-action within sight of the retailer, there are plenty more location-based opportunities that encourage customer loyalty, such as special gifts, alerts to flash sales and early access.
Cooking a Data Stew
With the evolution in data analytics, marketers can now mix different types of data to glean new insights. David L. Smith, CEO of media agency Mediasmith, sees this as the coming of age of the data management platform: tools that integrate data from several sources, including customer information, website data and digital advertising input. All of it serves to improve messaging.
“Messages that come from ad campaigns, direct mail and other communications to the consumer can be coordinated,” Smith says, “so that the consumer is always getting relevant information—not just standard communications.”
Collecting Data—While Respecting Customer Privacy and Security
All these data-driven trends can bring benefits to the consumer and improve marketing efficiency. But they also raise privacy and security issues—to which marketers are giving serious attention. “Privacy is going to remain a constant fear in the consumer’s heart,” says Michael Hardin, dean at the University of Alabama’s Culverhouse College of Commerce. “A lot of companies are going to be struggling mightily to deal with that.”
Smart marketers will learn how to walk this fine line and mine significant value from relatively little personal information, says O’Hara. One company strikes this balance with one of its products, an activity-tracker wristband: With just a little personal data input from its user, the wristband gives them athletic performance feedback.
These new technologies are changing the world of marketing—especially given the speed at which data are arriving, says Hardin. Shrewd marketers are contemplating how best to react in a way that benefits their companies.
[This post originally appeared on 6/16 in WSJ]