If you're a small business owner or professional who helps manage digital marketing strategy for your company, you've undoubtedly heard of the impact of big data on such efforts.
The use of big data on digital marketing can be very impactful especially given big data's four characteristics—volume, velocity, variety and veracity—all of which may lead to more accurate data analyses.
The 4 characteristics of big data—often called "The 4Vs of big data"
1. Volume: The chief characteristic of big data is simply how much of it there is. Big data is culled from various sources, including:
- Point-of-sale data
- Social media platforms
- e-commerce sites
- Internet of Things devices
2. Velocity: Big data statistics can be delivered much faster than conventional data thanks to the advent of:
- Internet of Things technology
- 5G data streaming
- RFID chips (radio frequency identification tags)
3. Variety: Big data comes in a variety of formats, including:
- Ad responses
- Social media sentiment
- Email actions
4. Veracity: This refers to the accuracy and trustworthiness of big data thanks to:
- Large sample sizes
- Real-time collection
Role of big data in digital marketing
Big data plays many roles in digital marketing today. Among the most prevalent are:
- Audience segmentation: Big data allows marketers to compile, explore and analyse various aspects of behavioral criteria—how people use their products and services—as well as social and demographic factors. The findings can help more efficiently determine consumer personas and preferences so marketing messages can be enhanced and optimized.
- Sentiment analysis: By analyzing social media posts, reviews and search queries, marketers can better understand how consumers feel about their brand.
- Targeted marketing: Product recommendations, social media advertising and email drip campaigns use big data analytics to deliver more relevant content to consumers.
- Predictive and prescriptive analysis: Marketers can work with the supply chain to help ensure more adequate production of goods based on demand forecasting driven by big data.
- Result measurement: Campaigns can be measured and adjusted in real time for budget optimization.
- Sales growth: The factors above could potentially drive increased sales.
Potential benefits of using big data in digital marketing
As the infographic above illustrates, there are many ways you can utilize these learnings to help with more successful digital marketing. But what are the specific benefits of big data in marketing?
Most of the benefits of big data in marketing relate to better understanding the factors that drive successful campaigns.
- Competitive analysis: Gain insights into your competitor's marketing campaigns to see what works and what doesn't work.
- Understanding market trends: By analyzing historical data, you can use predictive analysis—demand forecasting coupled with prescriptive analysis action items—to help tap into market trends.
- Potential increased profitability: Using big data for targeted marketing can help reduce ad spend, shorten the supply chain for just-in-time delivery and help deliver more successful marketing campaigns, leading to potential business growth.
Big data sources that can be used to refine your digital marketing strategy
If you're looking at ways to make big data work for your business, you'll want to consider all the various sources to collect data. We often think of big data and digital marketing working together only in an online environment, but don't neglect tapping into the Internet of Things, in-store kiosks and inventory management systems for data collection as well.
Future of digital marketing with big data
The role of big data in digital marketing has expanded in the past several years. However, integrating big data with real-world analytics presents several barriers to entry. Likewise, storage and analysis obstacles make some businesses hesitant to use big data to its full potential.
As collection methods become more streamlined through the Internet of Things, mobile use, voice search in homes and vehicles using AI assistants, data may become even more accurate, sophisticated and expedited. Companies that leverage this data could potentially create better retargeting campaigns, craft more relevant product suggestions and deliver advertising content that speaks directly to their audience.
Even with the wealth of information delivered to consumers every day, data-driven digital marketing could shorten sales funnels and increase profitability.
This article is intended for general informational purposes only and does not constitute legal advice or an opinion on any issue. It should not be regarded as comprehensive or a substitute for professional advice.