What if there was a highly effective marketing technique that your business was ignoring?
The right database marketing strategies can help your business grow at an astounding rate. Unfortunately, many businesses don’t know what these strategies are all about, much less how to make the most of them.
Interested in learning more about what these strategies can do for your own company? Keep reading to discover the answers!
What Is Database Marketing?
Our guide will help you learn how to make database marketing work in your favor. But before we can review effective database marketing strategies, we need to answer a basic question. What, exactly, is database marketing?
The term “database marketing” refers to a business collecting consumer data in order to discover what these customers need and offer personalized solutions to suit those needs. That is why this type of marketing is also known as customer relationship management.
How does this differ from standard marketing, though? If we’re being honest, much of traditional marketing is focused on trying a little bit of everything and seeing what gets a response from your customers. But with database marketing, you can gain important insights into what customers actually want and incorporate that into your marketing efforts.
Different Types of Database Marketing
“Database marketing” may sound like an all-encompassing term. But there are actually different types of database marketing that may be pertinent to your business interests.
Consumer database marketing works well for companies that sell directly to the consumer. This approach typically involves gathering as much data as possible through things customers enjoy, including special contests, giveaways, and unique offers. And even the info you gather during checkout can be invaluable to building a consumer database, and you can gain more data via third-party sources.
As the name implies, business database marketing pertains to B2B businesses. You still need to collect data, but the methodology is different. You may be able to collect important information through special events, industry reports, webinar registrations, and downloads for things like white papers, free trials, and assorted marketing tools.
While the customers and the data collection methods are different, the end result is the same: to use this data and create a more personalized experience for customers.
What Makes Database Marketing So Special?
Now you know more about what database marketing is. But before we get into the specific benefits this marketing offers your business, we must answer another essential question. What, exactly, makes database marketing so important?
The short answer is that the “Information Age” is really living up to its name. Our world is more digital than ever before, and there is more consumer data available than ever before.
At the same time, demographics are shifting in some unique ways. For example, Millennials have led the way for the demand for a more personalized experience from companies. Gathering and analyzing enough data will help you provide the ultimate user experience, which may be just what you need to set yourself apart from the competition.
As you might expect, there are many other benefits as well.
Unique Benefits of Database Marketing
What are the different benefits of database marketing? First of all, it gives you a much more detailed understanding of your customers.
With the right data, you can break your customers down into very specific groups (ranging from loyal brand ambassador customers to those encountering your company for the first time). And you can even break each group into specific segments based on information such as interests, behaviors, and other demographic data.
Second of all, this data allows you to create a more personalized experience for customers, including personalizing any correspondence that you send to them. For that matter, the data will also give you insight as to the best time to reach out to customers. After all, conversions and sales often hinge on reaching the right customers at the right time.
Third of all, a robust database can help take your customer service to the next level. That’s because every employee speaking to a customer will have instant access to info about all previous interactions with the customer.
Finally, information from the database will help you figure out which customers to focus on and which ones are least likely to respond to you. And once you have that narrowed down, the data can help you build things like loyalty programs that keep your favorite customers coming back time and time again.
What Makes Database Marketing Difficult For Most Companies?
There are plenty of great benefits to database marketing, including target audience identification. But as we noted before, many businesses struggle to make these marketing strategies work. What, then, makes database marketing so difficult for most companies?
One obvious issue is the accuracy of the data. You must rely on info you collect from customers, but there is always room for typos and other kinds of errors. This is one reason why many businesses now use dropdown menus and checkboxes: there is less room for human error.
Another major issue is the decay of the data. Even if the information is accurate at the time you collect it, things like the employer name and current address are likely to change. To mitigate against data decay, you may want to focus more on data that won’t change (such as names and phone numbers versus something like their current business email address).
By far the biggest obstacle for modern companies, though, is taking advantage of the data in a timely manner. It can take time to collect and analyze all of the relevant data, and additional time to develop marketing strategies to reach the customer at the exact right time. If you take too long with this process, you might miss miss your window in reaching out and converting customers.
Solid Database Marketing Strategies
By now, you know more about what database marketing can do for your business. But to really enjoy those benefits, you need to understand some solid database marketing strategies.
One basic strategy involves developing an intensive look at your target audience. Ideally, you will know things about their average age, income, education, location, and interests. For maximum effectiveness, you should take this information and convert it into customer personas for your sales and marketing teams.
Speaking of teams, another effective strategy involves collaboration between your different teams. When marketing, sales, and support teams pool info about customers (especially with a good CRM tool), it can make each team more effective.
And make no mistake: finding the right software is crucial to this entire process. No software is a “one size fits all,” so you will need to decide which software has the features that work best with the needs and KPIs of your own team.
This may go without saying, but you also need to collect as much customer data as you can using a variety of methods. Demographic and psychographic data are equally important, and you should focus on acquisition data and transaction data wherever possible.
Correspondence data is important in order to personalize everything for customers, and activity data helps you accurately chart customer interactions with your company. Finally, don’t forget technographic data: knowing about the devices and platforms your customers are using can help you further personalize their experience.
Don’t forget that this is an ongoing process. The best way to fight against data decay is to constantly gather the most recent data possible. Just be sure to respect customer privacy at every stage of the process.
Putting the Strategies in Action
So what do these strategies actually look like when you put them into action? Let’s take a closer look at the real-world applications of your database marketing strategies.
If you have a media platform, you can use data to identify who your most loyal binge watchers are. With this information, you know exactly who to try to upsell a premium subscription plan to. And you can target the with a drip email campaign while using predictive analytics to adjust some of your marketing techniques.
If you want to improve your customer service, good CRM software can be a real game-changer. Every CSR can record new information about a customer after every interaction. Having this information on hand will save everyone time while letting you fully customize your customer interactions.
Another common scenario is that you are working on new products and services and need to discover whether your existing customers will embrace the changes. Studying purchase trends and demographic data will help you verify an interest in these new products and services before you sink a lot of research and development into a new project.
Now you know what database marketing strategies are and why they are so important. But do you know who can help you take advantage of database marketing?We specialize in software that helps you provide a more personalized experience to customers. To see what we can do for your business, book a demo today!