2.5 Exabytes of data are produced everyday by internet users. That’s equivalent to 250,000 Libraries of Congress. With so many posts, pictures, reviews and videos at our disposal, we tend to think we already know everything we need to about our customers. In reality, more data often translates into less insights. Overwhelmed with data points, marketers struggle to extract the clues that are most relevant to their brand and tend to lose sight of the business problem they were trying to address in the first place. In fact, Getting Digital Right found that only 41% of brands felt confident in their organization’s use of big data.
Below are some of the limitations of big data and solutions to help brand managers extract the most value from these large data sets.
The Value Of Big Data As Stand-Alone Datasets Is Limited
By definition, behavioral data tells you what people do but not why they do it. This can be very misleading, especially if you are trying to pinpoint buying signals. Think of lifestyle products, such as luxury cars or watches. Of the thousands of people who google Ferrari or Rolex every day, how many are really in the market to buy one in the near future? Many of these users research lifestyle brands to daydream and self-actualize, with no real intent to buy these products anytime soon.
That said, behavioral data can be helpful to drive an impulse purchase or sale of lower price items. For example, retargeting (a form of advertising by which the ad is targeted at consumers based on their previous internet actions) can prove to be very effective. If you’ve looked at a book on Amazon this morning and keep getting retargeted with an ad for this same book, chances are you will end up ordering the book, especially if its price has dropped.
But retargeting can also turn into a waste of money, when marketers retarget prospects with products they have already bought. This points to another limitation of big data, whereby marketers often track search activity independently from conversion. If your customer just bought a coffee maker, it is highly unlikely he will buy a second one in the near future. The downsides are obvious: you are wasting your advertising dollars, damaging your brand by annoying your new customer and missing an opportunity to cross-sell companion products (such as coffee cartridges).
Never Lose Sight Of The “Why”
Seduced by big data tactics that seem scalable, instantaneous and cost-effective, brand managers often lose sight of the “why”. That is, why do people do what they do? And how can you seamlessly insert your brand in their thought process? The answer can’t be found in your consumers’ last few clicks.
Today’s consumer journey has 22 touchpoints on average. It is the strength of your brand that leads consumers to search for and select your product, more so than their last two or three clicks. Kantar Millward Brown’s Meaningfully Different Framework highlights that to be recognized and trusted, your brand must be meaningful, different and salient. It is these three qualities, in varying combinations, that predispose consumers to choose your brand and pay for its premium.
Behavioral data is most valuable when connected to other data sets, such as demographics and psychographics. I might not be in the market for a Ferrari this week, but now is a good time to sell me a book on career development (that will get me there) and a Ferrari polo shirt (that will enable me to self-actualize and keep day-dreaming in the interim).
Attitudinal data will provide you with depth and perspective into an otherwise basic outline of your consumer’s behavior. Combined with behavioral data, it will allow you to better understand what your consumers’ expectations and motivations are, refine your brand message and inform your advertising creative process.
Last but not least: when implementing retargeting tactics, add a conversion pixel to the post-transaction page, to stop targeting people with products they just bought and start up-selling them companion products.
In sum, marketing tactics based on behavioral metrics are the most powerful when combined with demographic, psychographic and attitudinal data. Such an approach enables driving action (i.e. enquiry or purchase) while constantly growing your brand’s equity. To measure your progress, it’s a best practice to track your lower funnel activity in conjunction with a robust brand health tracking program.
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Branding Strategy Insider is a service of The Blake Project: A strategic brand consultancy specializing in Brand Research, Brand Strategy, Brand Growth and Brand Education