– By Lauren Brudermann, Junior Digital Marketer, nexoya
Competition nowadays can be harsh, especially online. Users have an unlimited choice of options and are looking for the most convenient solutions to their needs. Therefore, personalization and customer experience are crucial, and a custom-fit offer is vital.
Using predictive marketing analytics allows companies to know more about their users’ behavior and future events and results. Predictive analytics empowers marketing teams by deploying a unique data-driven approach, which is becoming necessary to sustain a competitive advantage.
Understanding marketing analytics helps marketers measure, manage and analyze marketing performance to maximize its effectiveness and optimize return on investment (ROI).
Marketing analytics changed over the years, especially by introducing predictive analytics into the digital marketing world. Predictive analytics can be very beneficial as marketers will increase the likelihood of reaching the set goal for a marketing campaign.
What is Predictive Marketing Analytics?
By combining statistics, predictive modeling, and machine learning, you can form accurate predictions about customers and marketing results.
The main types of analytics are:
- Descriptive analytics: Predicting future events using historical data and performance.
- Predictive analytics: Determining what is likely to happen in the future by looking at past data and using algorithms.
- Prescriptive analytics: Deciding what to do next based on what you’ve already done or what’s already occurred and what is most likely to happen.
How do Predictive Analytics Work?
Using predictive analytics effectively involves multiple steps and a well-defined process.
- Know precisely what outcome you’re hoping to achieve; by doing so, you will know which is the right path to find the answers you’re looking for. For instance, your question could be, “What marketing leads (MQLs)are most likely to purchase during December.”
- Collect the correct data, whether it is historical data, demographic information, or behavioral data.
- Dig into data to find the answers to your questions.
- Use statistics to create hypotheses and test each of them to come up with conclusions.
- Once you have validated or eliminated each hypothesis, you can start creating a predictive model. You will then be able to predict future events, outcomes or behaviors.
- Once you have this model, deploy it by using your data to get actionable insights for your marketing and sales campaigns.
- Monitor your model, and if needed, adjust and create new ones to remain accurate (i.e., seasons can throw off your data).
Predictive Analytics can prove essential for optimized, modern marketing campaigns
5 Ways Predictive Analytics can Boost your Marketing Campaigns
Now let’s look at how you can use predictive analytics to reinforce your marketing efforts and boost your marketing campaigns efficiency.
We have listed a few points:
1. Targeting and Segmenting
Using data can help you segment your leads and create better-targeted campaigns; this is useful for bringing leads down the funnel. Moreover, having a specific and targeted campaign is excellent for current customers and attracting new leads.
Targeting helps brands and consumers by improving marketing strategies and audience experiences and builds brand awareness and loyalty.
Once you know your audience and segments, you can create targeted content on each distribution channel. The targeted content will resonate with your audience and enhance the customer experience. It ensures a more effective communication strategy. By doing this, it improves customer acquisition and retention processes.
2. Predicting User Behavior
As you may have guessed, to predict future user behavior, you can build a model. By combining past campaigns data, you will know how likely users are to take a particular action. This is very important because once you have this information, you can adapt how you approach them through marketing.
“Knowing who your customers are is great, but knowing how they behave is even better.” – Jon Miller
Predicting user behavior will help you maximize your consumer value by acquiring valuable information to increase conversion and retention rates.
3. Predicting Customer Lifetime Value
By using historical data, you can determine which activities or users are the most profitable now and in the future. In order words you can predict how much revenue a customer will bring you and know his expected lifespan.
Knowing this information is crucial; it will help you estimate the acquisition cost of a new customer. You will then be able to plan your marketing budget accordingly and your ROI.
4. Refining your Marketing Campaigns
By combining behavioral, demographic, and historical data, you will understand what your current customers expect. You can then dig deeper to predict what else they would need from your business in the future. Predictive analytics in marketing can easily help marketing optimize campaigns and perform CPC models.
5. Optimizing Future Marketing Campaigns
Marketing campaigns are becoming more complex. There are many variables, details, and processes to consider as well as great complexity. Predictive analytics reduce risks by taking a lot of the guesswork out of your process and help grow faster and higher ROI. In addition, predictive analytics allow better marketing budget planning.
Overall, predictive analytics can help you increase your marketing campaign profitability and efficiency. Predictive models help companies learn about customers, buying intent, preference, and causation in their behavior. Marketers should always be at the forefront of trends, new methods to enhance their marketing campaigns to be more targeted and effective. To stay competitive, marketers must become data-driven and leverage innovation, which now include predictive analytics.