Thursday, January 14, 2010

The Foundation for Great Marketing is Great Data

Data is key to all your marketing efforts. Whether it is segmentation, personalization, lead scoring, lead routing, or marketing analysis, if you don’t have clean and consistent data, your efforts will be built on the shakiest of foundations. However, when thinking about your marketing automation efforts, data management can often be an afterthought.

However, some minimal upfront efforts to understand and improve the quality of your data can greatly improve your effectiveness as a marketer.

Current Database

First, you need to understand your current database. There may be a significant amount of data in your database, but unless it is data you can work with, it will not be adding value to your organization. Some simple analysis should give you a good sense of your current state:

- Growth and Total Size: The simplest of metrics; analyzing both the total size of your database and its growth over time gives you a clear sense of what you’re starting with. Net new contacts add to your total, while bouncebacks, and unsubscribes detract from it. In this measurement, be sure that you are truly measuring unique contacts, without any duplication. The overall database size should be growing in a healthy manner, although growth rates can vary depending on the growth rate of your company and your industry.

- Active/Inactive: Of equal importance to size of your marketing database is the analysis of what percentage of your database is active or inactive. A basic definition around “active”, such as a certain number of emails opened or clicked, visits to the website, or form submits will give you an objective definition of who is active. Those who are inactive may have “emotionally unsubscribed”, and are unlikely to be future buyers. It is more important that the active component of your database is growing over time than the overall size.

- Completeness: Each field that is of importance to you should be analyzed for its completeness. In many marketing databases, key fields may be only 30% or less complete, which leads to challenges in using those fields for marketing efforts. If your analysis shows that fields are less complete than ideal, you may want to use progressive profiling to add data to those fields

- Consistency: Even if a field is filled, if the data is inconsistent, it can be very difficult to derive value from it. Fields like Title, Industry, Country, State, or Revenue are very often extremely inconsistent as the data can be input in a wide variety of ways. Analyze each field for the breakdown of what values are in that field and their percentages to see if the data is generally consistent or inconsistent.

Some marketing automation platforms are able to perform this kind of analysis, but there is a lot of variation in the industry, so ask the tough questions if you are considering a marketing automation investment as this analysis will be key to your success.

Data Sources

With your own marketing database quality understood, you then need to begin understanding your sources of data to understand what will make your data challenges worsen if not controlled. Marketing data comes from many different sources, each of which has its unique opportunities and challenges.

- Other Systems: Marketing often sources data from CRM systems, data warehouses, or customer data masters. The data from these systems often must be brought in on a nightly (or more frequent) basis, and integrated into your marketing data. In many cases, there is limited opportunity to change the format or quality of the original data, and it must be dealt with on import automatically each time it is imported

- Continual Sources: Web forms, tradeshow leads, webinar registrants, and trial downloaders contribute a steady flow of data to the marketing database. The continual nature of these sources means that as a marketer, your database is being updated 24 hours a day, 7 days a week. This means that data cleansing must be done continually, and inline, rather than as a batch process once or twice a year

- Controlled vs Non-Controlled: Many of the sources you deal with are not sources that you are able to control. Lists from tradeshows, business cards, and many web forms are not sources that you are able to control, so the data from them is of varying quality and varying standardization

Given that you, as a marketer, are dealing with a variety of data sources, many of which are out of your control, and many of which are operating 24x7, keeping the data clean and consistent can be a significant challenge. The best way to approach this is to build a “contact washing machine” that standardizes and normalizes your data. Each time data is touched, whether from a web form, a list upload, or from your CRM system, it should flow to the contact washing machine.

Again, this is an area to ask tough questions in if you are looking at making an investment in lead management software as it makes a significant difference to your success. Look for contact washing machines that are a single, centralized point of data cleansing, and can handle standardizing and deduping data fields from industry to title to revenue. The best option is to have a pre-built structure out of the box, that you can then modify to meet the exact requirements of your business.

Data and the User Experience

In thinking about data, there can be a temptation to burden your audience of prospects with the data requirements of your marketing database. This is never a good idea. Many studies have shown that the more fields you add to your web forms, the more likely you are to see users drop off and not fill them out. Similarly, the more you restrict the input options that you provide to your audience (such as only allowing drop-down select lists for an individual’s job title), the more frustrated your audience will become.

The best option is to approach the challenge in two ways. Progressive profiling can be used to ask for a minimal amount of data at each interaction, never ask the same question twice, but continually add to a modular profile. This allows you to minimize the number of fields being asked per web form, and maximize the conversion rate. For the data itself, given the user frustration added by constraining their options, and the fact that many sources of data are beyond your control anyway, it is often better to allow free-form data while managing its quality via a contact washing machine once it enters your marketing database.

Data as a Foundation for Great Marketing

Today’s best marketers are building their creative campaigns, precise segmentation, accurate lead scoring, and relevant personalization on a base of great data quality. In fact, when top CMOs talked about their marketing dashboards, the focus on quality data was key to each of their successes. Whether you have made a marketing automation investment, and are looking to maximize the return you get from it, or are considering a marketing automation investment and want to know the right questions to ask, data should be front and center. It’s the foundation upon which everything else in marketing rests.

(*this post was originally posted on the marketing community)
Many of the topics on this blog are discussed in more detail in my book Digital Body Language
In my day job, I am with Eloqua, the marketing automation software used by the worlds best marketers
Come talk with me or one of my colleagues at a live event, or join in on a webinar


Marketing Insight Guy said...

Great reminder of the importance of data quality in marketing activity, and particularly heartening to see a marketing automation vendor talking about this. Solutions such as Eloqua are very powerful, and facilitate relationship building and considerable efficiency gains. The corollary of this though is that the impact of poor data will be magnified, highlighting the need to tackle this issue strategically.