Using Data To Build A Better Online Business
Online marketers that understand how to use data to improve their online business are reaping the benefits. No longer are they relying on emotional hunches to make choices. They are making informed decisions about their businesses and where to invest their efforts because they understand how to collect and use data analytics to their advantage.
I previously discussed how several digital marketing sites cited data as a big trend this year, and why it is one of the most crucial aspects to your business growth. I highlighted ways in which businesses may not be using their own in-house staff members and data aggregation platform in the right way to create a better data aggregation system. A business and its marketing team must understand that there is no one magic formula for being profitable with the use of data. In fact, after having a proper team in place and amplifying data aggregation for improved performance, the next step is all about knowing what to do with that information.
Affiliates are not Consumers
In my experience of being in the affiliate marketing industry, online businesses with affiliate programs tend to make the mistake of thinking that affiliates, publishers, resellers are the sole source of profit for their program. Affiliates are one important element of a larger marketing strategy. If you have organized your data aggregation platform to accurately reflect the most pertinent information you want to collect without violating privacy laws, you will know that the greatest value is in your consumer data.
When you become consumer-focused, rather than only being concerned about partners who drive traffic to your site, you can start to tailor your service or product to truly meet the desires and needs of your consumers. Let your affiliate managers handle affiliates and measure how well they are performing or how much they are earning for you. Your dream team, however, should focus on your consumer data and analyticsâ€”this will allow you to repeat what really works, modify what needs improvement and drop what has no chance of delivering an ROI.
Who, What and Where is your Target?
Daily deal sites like Groupon and LivingSocial have honed in on a goldmine: localization. Targeting the right areas (philosophically and geographically speaking) makes good business sense. Daily deal sites know they are better off targeting major markets where the population is dense. If your data tells you that you attract more business from the northwest coast of the US than you do from the southeast, itâ€™s time to be strategic and go where the business is. If you are noticing that 40 percent of your online business is being generated out of Canada and you have yet to explore that market, itâ€™s time to pay attention to how you can appeal to those consumers. Donâ€™t invest time and effort in an area where you are not seeing any sort of benefit. Try approaches like developing a focus group of your best consumers to learn more about who they are and what they think about your product or service.
Real-time Information for Real-time Decisions
Making decisions in real-time is a real must. The data you collected in 2009 probably is not going to give you the answers you are looking for now, and will no doubt fall short in providing you with a full picture in the changes that have since transpired. If you launched a limited-time discount for a period of a week, it is wise to look at what day and time the offer saw the most traction, in addition to how much exposure the offer got. Look at the conversion rates when your offer went live. Also, ask for feedback. An affiliate manager will often personally contact a super affiliate if he/she has been sending an unusually low amount of traffic. You wonâ€™t know what the reasons could be for not promoting until you speak to them (i.e. concerns over low conversion rate, family or work obligations, security breach of their site). The same can be said of your consumers. Go directly to the source and find out where they are and why things have changed.
Protect and Manage your Goldmine
Using data analytics offers your business an advantage over competitors who may not be adequately aware of their own strengths and weaknesses. You may have heard about a breach in data security that recently affected email marketing firm Epsilon earlier in April. Epsilon became the victim of a hacker attack and their clients like major US brands such as Best Buy, Chase and Walgreens were affected. Subsequent media coverage revealed that those major businesses outsourced to Epsilon to manage their data. Itâ€™s not that I donâ€™t believe in businesses outsourcing to third parties, but this makes me question just how closely are teams (be they in-house or outsourced) working together to really protect the information they are garnering. How much about the customer is the outsourced party communicating back to the company? Do you have frequent access to your data through your outsourced partner?
There are many opportunities out there for companies to use data for improved profitability. Once the platform for data aggregation is set up, itâ€™s time to look at how that information can be used effectively. And then use it wisely.
About Nicky Senyard
Nicky Senyard is the co-founder and president of Share Results, a Canada-based online marketing company specializing in affiliate marketing. A native of Australia, and an entrepreneur with a background in public relations, Nicky is a highly sought after speaker and service provider in the affiliate marketing industry.