Marketers have been analyzing their methods and techniques since the mid-19th century, but today’s data analytics bears no resemblance to those early marketing efforts used to maximize profits. Data analytics models, propelled by digital technology, measure the value of every customer action and touch point across multiple channels and devices. More than 80% of marketing professionals make their decisions based on data, using advanced analytic tools to evaluate digital marketing campaigns at every step of the customer experience.1
The future of digital strategy belongs to those who know how to use these sophisticated tools to gain valuable marketing insights. In this article, we take a deep dive into data analytics in digital marketing—what it is, where the data comes from and how it can be used to make digital marketing campaigns more successful.
Data Analytics in Digital Marketing
The process of collecting and evaluating data from several digital sources in order to get practical insights into a business’s digital marketing tactics is known as data analytics in the marketing industry. By providing a customized experience, digital marketing analytics tools can reduce churn rate—the percentage of consumers who leave doing business with a company—and raise the value of current customers.2,3 According to a 2020 corporate analytics research, just 30% of companies had a defined data strategy, despite 94% of organizations viewing data and analytics as critical to their digital transformation and success.4,5
By taking the uncertainty out of marketing strategy and maximizing the return on investment from a company’s marketing budget, data analytics helps firms operate more efficiently.Six
What Are the Three Models of Marketing Analytics?
To plan, manage and optimize their marketing campaigns, professional marketers use three types of analytic models.6
Descriptive:
Historical data is collected from earlier campaigns, and this information is used to provide insight to help plan strategies for future campaignsPredictive: These data analytics models use insights from prior marketing campaigns to try to predict customers’ behavior so that the company can develop a better-informed, more targeted campaignPrescriptive: These models gather data from all available touchpoints, analyzing the impact of each company initiative and customer interaction, to help the organization create highly targeted campaigns that influence customer behavior
Together, these analytic models form a complete picture of the effectiveness of marketing campaigns and how each company can achieve its desired results more efficiently.6
Where Does the Data Come From?
The raw data for digital analytics comes from many different sources, and it can be overwhelming if a company lacks the in-house expertise to use it effectively. Information about customer interactions can come from:
Website data (tracking)Product data (most/least liked features, conversion events, areas of friction)Digital marketing data (keyword analysis, social media interactions)Internal customer data (accounts, transactions, complaints) 2
It is now possible to gather this type of data in real time, without direct customer contact.2
How Marketing Analytics is Used
Marketers use data analytics to make sense of a large amount of customer data, using these insights to guide their product strategy, brand and marketing campaigns.7
Using sophisticated data analytics techniques, companies can better understand their market and customers, which can lead to effective digital marketing tactics, more personalized customer interactions, greater customer satisfaction, higher efficiency and bigger profits.
Compile Comprehensive Customer Profiles
Bringing together data from various sources lets you see the complete user journey in one place. For example, you can see how customers arrived at your website (ad, social media, etc.). You can also see all their events and actions, such as inquiries or product purchases.2 Data analytics can show you the entire customer lifecycle, from an unmet need and awareness of your products or services, to interaction with your company, to purchase and engagement. These same customers may even go on to become product/company advocates, sharing their experience with potential new customers.8
