Data-driven marketing is almost like having sales telekinesis.
By leveraging the countless data points out there to craft your marketing strategy, you can create more relevant, efficient, and valuable marketing campaigns. Learn how you can harness the awesome power of data-driven marketing—and watch your brand reap the rewards.
What Is Data-Driven Marketing?
Data-driven marketing involves using customer data to build personalized campaigns. If you know certain things about your audience, you can offer solutions tailored to customer needs while predicting behaviors. Surprisingly, data-driven marketing is distinct from traditional methods. Conventional marketing relies on case studies and simply making assumptions. Those assumptions often miss the mark completely. By cutting out this guesswork, data-driven marketing delivers an approach to marketing that truly resonates with customers.
Why You Should Be Using Data-Driven Marketing
Marketing isn’t just about creating loud, clever campaigns. It’s about making informed decisions on reaching your customers based on statistics. With data-driven marketing, your company benefits from tracking metrics and allocating spend wisely. Plus, personalized campaigns tend to pack a punch.
Types of Data-Driven Marketing and What It Can Tell You
Clickthrough Rate
Email clickthrough rate is based on the ratio of recipients who open your email and engage with its content. They do this by clicking on one or multiple links contained within your message.
Clickthrough rate (CTR) gives direct insight into how many individuals on your list are engaging. You can assume these individuals are eager to discover more about the brand or the offer. This essential metric also enables you to determine the success of their email campaigns in real time and track CTR evolution.
Calculating the CTR is straightforward and can be done by applying the following formula: (total clicks OR unique clicks ÷ number of delivered emails) * 100. However, make sure to be consistent when selecting either total clicks or unique clicks for applying the formula.
Tracking CTR enables you to monitor the performance of individual emails.
Conversion Rate
Email conversion rate refers to the percentage of recipients who click on a hyperlink within an email and do something you want them to do—such as filling out a lead generation form or buying a product.
There are several ways to determine conversion rates from email marketing. One effective method is to track URLs to infer which links were clicked to reach the goal data. For example, this could be clicking on a link that leads to an external website.
In particular, conversion rates are useful for generating leads and prospects, as a higher conversion rate means a higher probability of getting more leads.
Email Bounce Rate
Email bounce rates signify what percentage of your emails couldn’t make it to a recipient’s inbox successfully.
Deliverability is a crucial aspect of any data-driven marketing strategy. Tracking email bounces can be helpful. There are two types of bounces to monitor when sending emails: “hard” and “soft.”
When emails bounce back as “soft,” it means there’s a temporary issue that needs fixing before the recipient can receive and read the email. On the other hand, a “hard” bounce means that the email address is invalid, non-existent, or closed. It will never reach the recipient.
Always remove hard bounces from the email list as soon as possible since they could harm your reputation as a sender. Too many hard bounces can get your company flagged as a spammer. Be sure to analyze the soft bounces as well, as they point to issues that can be fixed.
List Growth Rate
The aptly-named list growth rate is the rate at which your email list is growing—or, in some cases, shrinking.
Keep your email list healthy by keeping track of not just the call-to-action metrics (CTR, conversion rates), but also list growth and loss. Growing your list is critical to extending your reach, expanding your audience, and establishing yourself as an industry thought-leader. With a natural 22.7% decay of email lists every year, prioritizing subscriber list growth is now more vital than ever.
Email Sharing & Forwarding Rate
Email forward and share rates represent the proportion of recipients who clicked on the “share this” button to broadcast email content on a social network or clicking on “forward to a friend” button.
Sharing rates can be used to guide your email campaigns and offer insights into the kinds of content that resonate the most. Always watch your rates closely to increase your lead database.
Overall ROI
ROI represents the overall return on investment acquired through email campaigns. It can be calculated by dividing the total revenue garnered by the total money invested.
To truly showcase the value of data-driven marketing, dig deep into the metrics. You can set up a system that assigns values to various types of leads based on their likelihood to generate revenue. This can inform how you generate different types of leads and translate them into actual revenue.
Open Rates
Email open rates determine the ratio of recipients who access a specific email. Open rates can be a valuable metric… but we almost hate to talk about them. All too often, we hear about marketers getting caught up in optimizing subject lines for better open rates. Yes, these are important. But, optimizing for clickthrough rates can have an even greater impact on your overall performance.
Here’s something else to consider: open rates can be a very misleading metric. Image-blocking is widely used among email users, and an email is only considered “opened” if the images are displayed. As a result, your open rate may not accurately reflect the true number of emails that are actually being opened.
Rather than relying solely on open rates, use it as a comparative metric for your different campaigns. Analyzing changes in open rates can offer insights when kept in context with other variables that impact your campaigns.
Unsubscribe Rates
Unsubscribe rate refers to the ratio of email recipients withdrawing from your send list after accessing a particular email. However, use caution when assessing unsubscribe rates. Like open rates, they don’t paint a complete picture. Some subscribers may just stop engaging without unsubscribing. To best measure the efficacy of your campaign, clickthrough and conversion rates should be given more weight. Identifying disengaged subscribers grants you the opportunity to consider removing them to help facilitate growth. Don’t forget to monitor your unsubscribe rate monthly for calculating list growth.
Data-Driven Marketing Summed Up
Effective data-driven marketing demands astute metric tracking. Measure individual email performance, monitor email list health, and track progress toward overarching goals. These critical insights will ensure that your dynamic strategy yields results.
