What is DATA?
Data is everywhere around us.
And it has been here from the beginning of time. Through evolution, the number and quality of data have increased as human civilization started to rise.
The amount of usable data was comparable with the civilisational and evolutionary development of man.
For ice age hunter, trace in the snow was data that might have led him to the prey, such as the hunt for a bear. Or be misled and waste hours wandering around.
To find a difference between a relevant from insignificant information, a prehistorical man needed to collect, analyze, and use data to create a strategy on which will his survival depend.
Analyzing data was a life changer.
Therefore, while there are many definitions of data, the most prevalent view is one that says data is an individual piece of information that is collected to research and understand one or more processes.
Unlike the prehistoric man, who processed the data to meet primary needs such as survival, reproduction, and survival of the species, modern men use data in all aspects of life.
Let’s take an example of the human brain.
The brain is a collaboration of more than 100 billion neurons that continuously communicate with each other, using the data our senses collect.
For example, crossing a street is an action-driven by a set of data that is collected and stored in our brain (we call it experience) – the distance we need to cross, the remaining time at the traffic light, in which direction we will look when crossing. If we are at an unknown intersection, we will surely need more time to pass it.
The way we live, the partners we choose, the challenges we face, and even our business decisions, are all a result of processing the data available to us.
As the Gordon Gekko says – The most valuable commodity I know of is information!
So, how are we going to use the data to expand our business?
Data – a requirement for a successful business.
Ok, let’s look at the basic principles of business.
To successfully grow and scale our business, we need to understand the many aspects that affect it. First of all, we need to understand the market and its opportunities and threats. The first step towards understanding is market research, which involves identifying and analyzing customer needs, the size of the market, and the competition that operates in the industry.
In this process, we can rely only on the data available to us.
In the middle of the last century, the information available to us was limited. Therefore, research was expensive and reserved exclusively for large businesses with big budgets.
For example, in the 1970s, a lot more money was needed to research and understand consumer habits.
Fortunately, most of the information is available today, and the research process is much faster and more affordable.
For example, the world’s leading companies like Facebook, Google, and Apple, store billions of data information, and most of the data is accessible to all users in real-time.
With a few clicks, we can see how many people are interested in certain activities, how often they travel, what are their hobbies, interests, and other relevant data of our customers.
As a consequence of that, modern business is continuously evolving.
The main task is no longer to collect data but to understand and use it to achieve business goals.
Today we should not waste hours and days recording the demographics of our consumers (gender, age, and location), we can see it within minutes, based on the analysis of visitors to our website or channels on social networks.
And this is just the beginning. Besides demographics, we also have information such as:
- The amount of time spent on our channels
- How users navigate the website
- The pages they visit most often
- How often they return
- What source they came from
Whether they have bought ours or similar products so far, how often they buy online, what items they purchase, reviews, or their opinion about the company, customer support, and pricing.
Up to us is only to understand the information that we have.
Every day, worldwide companies serve over 5,000 advertisements to a unique user, whether it is television, billboards, print media, or the Internet. That is, if we once had a dozen media through which we could advertise, today there are (a slight estimate) several hundred!
In a world where so many advertisements are served daily, the attention of users is concise.
On average, on Facebook alone, every user goes over 100 meters daily by scrolling content on a mobile device.
We need to pay attention to the fact that two-way communication is common today in the modern business world. Unlike TV, where communication is only in the brand-user direction, today, this communication is directed in the user-brand direction.
If you wanted to go on vacation fifty years ago, the agency of your choice was probably the only one you knew about, through ads on one of the available channels such as television, billboards, radio, or newspapers. Today, however, the first place of departure when booking a travel agency that will take you to your desired location is an internet search engine (Chrome, Safari, Explorer), where you will find dozens of agencies within a few kilometers.
So, the question is, how do you, as the user, choose the agency with which you will travel?
First of all, you want to see the agency’s credit card, pricing information, reviews, arrangement descriptions.
The point is to gather as much relevant information about that agency you need to make a decision. And often, you will inquire at several agencies before making your final appointment.
To compare a user’s journey from initial information to reservation:
- Initial contact by the phone or directly going to the agency
- Price and terms inquiry
- Initial contact by the website or social network
- Search for available information such as reviews
- Analyzing the credibility of a company
- Looking for a specific offer page
- Query by email, phone call or some other channel
- Waiting for an answer
- Analyzing the offer and comparing it with other offers available
And at each of these steps, the potential customer can quit, fail to find what they need, or opt for a competition.
The smart data management we have is a prerequisite for success, and modern business needs to be data-oriented.
There is no place for vanity here.
Objectivity is lacking because what we consider is best may not be beneficial to our customers.
It is not up to us, however, to decide whether the website is of good quality based on colors and positioning but rather a tool analysis that informs us whether people remain on our platform for a long or short period.
The slogan we’re developing is as strong as the information we’ve been given. Whether or not individuals have become our customers due to the information that the slogan provides.
A video ad is only worth as much as it delivers end-of-day revenue.
To successfully set up a business, we must first and foremost clearly understand the motivations of our potential customers and what they like and what they don’t like.
What’s the solution to that? Personalization!
Personalization means that through our communication channels, we send different advertising messages that are relevant to the people who receive them.
Relevant ad reduces decision time, improves customer response, and drives sales results in general, whether we’re selling a service, arrangement, or a product.
How this might look like in practice:
User X is interested in buying sneakers of a particular brand.
User Y requests a complete range of sports equipment.
A sportswear company must service a relevant ad to both users.
An ad for the X customer that will include the details that matter to him – the sneaker brand he likes, the place where he can purchase it, and any associated purchasing benefits.
User Y ad containing a complete range of sports equipment he needs.
If a company does not create relevant market ads to users based on their intent, the chances of obtaining results are significantly lower.
Understandably, a relevant advertisement does not always have to be product-focused, it can also be a general promotional ad, but specifically aimed at the right audience.
We need to consider the next phase of the sales cycle – the User Funnel to sell relevant ads to buyers.
What is a User Funnel?
In short, the funnel is a method that allows us to understand more easily the stages that an interested individual goes through until they become a user. Each funnel consists of several steps, and each individual must go through these stages to become a customer or a user.
The most straightforward Funnel contains the following cycles:
- Brand awareness
- Interest in the brand
- Purchase decision
- Recurring customers
Every move is monitored, measured, and analyzed. Decisions are made as to how one visitor is guided through the stages to the final goal.
And for each of these stages, the communication and ad message should be different.
This could look like:
The company sells medical services.
During the first phase of the funnel, as many users as possible need to learn about the brand, a relevant message is sent to the target group.
The audience can be people over 35 years of age with health problems and people under 35 years of age who want preventive medical examination.
The second phase of the funnel would involve the selection of users who have shown some interest in the services of the company – such as a complete health check.
In the third phase, users who have shown interest in completing a health check-up must convert to customers, which means a campaign with a clear call to action.
And finally, anyone who has used our service should be offered something else from the company’s portfolio – If they have done a health check, offer them regular monthly check-up at a special price.
It is clear from the example that at each stage, the message and goals should be different. In the first phase, we need to spread a brand awareness message to as many relevant people as possible about our company. While in the fourth phase, it is our task to sell additional services (upsell) to our customers.
Modern business methods enable us to test target groups with very little money and decide which groups are more responsive and why.
Therefore, at the end of the day, as already stated, it does not necessarily mean that the beneficiaries of health services will be exclusively these two target groups, but perhaps some third, which we did not include in the initial strategy.
And finally, once we have the whole process in place and understand the habits and interests of our users, our ultimate goal remains – optimization.
Optimization is a continuous process that involves, on the one hand, improving results and, on the other, reducing costs.
Optimization depends, first and foremost, on the amount of data we have at our disposal and the quality of their analysis.
The more data we have, the better our chances of improving results and reducing costs.