What is and how to do Customer Data Management CDM

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This guide will teach you how to use data frameworks to offer differentiated customer experiences and optimize marketing ROI.

It has been a few years since the buzz around “Big Data” started. Working with marketing in the media space, you probably hear your peers bragging about their data-driven strategies a lot. Do you consider yourself a data-driven marketer too?

Beyond marketing, modern CMOs have had to assimilate abilities in information technology and customer data management.  In 2020, you should expect most marketing teams to effectively use customer data to drive growth and customer satisfaction.

Getting there can be quite a journey, though. Research from the Dentsu Aegis Network from 2018, made with 1,000 CMOs, shows that to two-thirds agree that while there is increasingly more consumer data available, it’s harder to extract insight from it. 

Another report from Harvard Business Review shows that less than half of an organization’s structured data is actively used in making decisions, while less than 1% of its unstructured data is analyzed or used at all. 

Historically, companies have relied on excel sheets and on manually storing and analyzing customer data through different software, with little to no integration. No offense to excel and isolated systems, but things have changed.

The amount of customer data flowing to companies’ databases continues to rise through new channels and platforms, and that’s where customer data management comes to play. More than ever, organizations need a complete set of practices and automation tools to help them manage customer information.

In this article, we will talk about the importance of having customer data management on top of the marketing agenda. We’ll also explore the types of data, best practices for data management, and the role of different data software in data management.

What is customer data management?

Customer Data Management, shortly known as CDM, is the framework in which companies collect, track, organize, analyze and share customer data throughout the organization. 

The term “Customer Data Management” was coined in the 1990s, initially as a way to describe software that replaced disc-based or paper-based data storage. Such software was often used independently by departments within companies.

The concept of CDM evolved along with the Software as a Service (SaaS) industry and nowadays embraces a wide array of cloud computing applications that centralize access to customer data. It also embraces a set of methodologies that help marketers to locate, cross-analyze, and act on customer data.

Why marketers should invest in customer data management?

In a scenario where customers interact with brands through dozens of channels, there is almost no room for guessing and gut-feeling in marketing. Having a good hunch about what will engage audiences is not enough, and so the role of customer data management is to provide companies with accurate and actionable insights.

It reduces your chances of making mistakes, since mismanaging your customer data can lead to actions that will ultimately reduce engagement and profitability. Additionally, using customers’ data in a biased, inaccurate way can lead to poor customer experience (CX) and harm your brand. 

Good customer data management is key to building a data-driven culture and bolstering customer-centricity in marketing. Isn’t it everything you wish for? 

Data Management strategies can bring marketers a holistic view of customers’ journeys, connecting the dots between different channels, and offering cues to enhance their experience.

Customer Data Management is important for: 

  • Customer acquisition
  • Increasing retention and engagement rates
  • Knowing customers in detail and in real-time, from individuals to clusters
  • Increasing data quality by breaking data silos
  • Simplifying customer relationship management (CRM) 
  • Drive higher revenue

How customer data management is connected to customer lifetime value (CLV)

Having well-structured customer data management practices is what allows marketing teams to follow up on important indicators, like the Customer Lifetime Value (CLV).

Amidst a seemingly chaotic user journey – with different channels, devices, and purposes – customer data management can help marketers understand customers and guide them through the conversion funnel. 

Collecting and organizing relevant customer data will allow you to better segment your audience, find out behavior and buying trends, and drive personalized campaigns. As a result, marketers can ultimately attract more qualified leads and reduce customer acquisition costs (CAC) – improving overall marketing ROI.

But customer data management is useful only for marketing. It can help sales, IT, and customer success manages customer touchpoints. The great news is that every department can have access to the same data and deliver a consistent, unfragmented user experience.

Four Types of Data to pay attention to

Before trying to set up a data management framework, your team should have a roadmap of data types and specific information that can enrich your strategy, according to your business goals. 

We will now explore four data types and a few examples for each.

1) Identity Data

Identity data is collected through micro-transactions and interactions in the company’s channels – when a customer signs up for a newsletter or enters their payment information on the checkout page.

By collecting customers’ identity data, marketers have the minimum amount of information to start a conversation (and hopefully a long relationship) with the customer. Such information is also helpful to help companies build brand personas. 

Examples of identity data: Name; Personal data (date of birth, region, gender, etc); Address; Contacts; Social media profiles; Account data.

2) Quantitative Data

Quantitative data is mostly related to the customer’s decision making process as they interact with your brand. Such data covers different channels throughout the customer lifecycle, from emails and customer support channels to purchase transactions and social media. 

The idea is to understand the specifics of how customers are interacting with your brand through important operational data. You could use quantitative data to find out details about channel interactions and steps that led customers to convert.

Examples of quantitative data: Transactional data, such as the number of purchases, time of purchase and subscription value; Order dates; Cart abandonment and Bounce info; Click-through-Rates; Website visits; Product views; Number of Interactions.

3) Descriptive Data 

Descriptive data comprehend additional lifestyle information that complements customer personas. Collecting this type of data typically requires doing deeper research and interviews with customers in order to dive into individual buying behavior. Such data is pretty helpful if you want to use predictive analytics in your marketing strategy.

Examples of descriptive data: Family Data such as marital status and number of children; Lifestyle data, like hobbies and interests; Education and career data.

4) Qualitative Data 

Qualitative data should describe the motivations behind the customer’s actions. Gathering such insights might be more time-consuming and expensive than simply collecting quantitative data, but it is worth it. After all, tackling into customers’ deepest motivations is how you’ll captivate them.

This type of data is better collected on a one-to-one basis, mainly through the marketing teams’ interpretations of customers’ opinions throughout their journey – through analyzing CRM notes or reviews in websites, social listening tools, feedback questions, and Net Promoter Score (NPS) systems. 

Best practices in customer data management

An effective customer data management framework requires marketers to make human and tech investments, have well-defined processes and priorities. We have picked a few key practices involved CDM:

Data collection 

A lot of the data within enterprises go unused, and so data collection is the first step in building an integrated customer data management strategy. There are millions of data streams coming into companies’ systems from many touchpoints, and so marketers need to make sure relevant data doesn’t go to waste. 

It’s important to understand what data needs to be ingested. Ask yourself: What goals do I want to achieve with my marketing strategy? Which data points are directly or indirectly related to my Key Performance Indicators (KPIs)? From there, you can start filtering your sources of data and the indicators you will track.

Data Integration

Centralizing all company’s data into a central system is also vital for customer data management. That enables the “ETL Process”, which stands for “Extracting, Transforming and Loading” data. This stage is where you will check your data integrity, filter it, and validate it. 

A good data system will ingest relevant data, convert it in necessary formats and load it into different tools such as a data warehouse, a customer data platform (CDP), a data management platform (DMP), a customer relationship management (CRM) or any other system. The result? You will have a single hub for all the data you need.

Data management

This is where you connect the dots between data points to build robust, unified profiles of individual customers or segments. This could mean using statistic models to create identity graphs, applying data governance to make sure you integrate consent to customer data, or anonymizing data to be used through a data management platform (DMP).

Data analysis and activation

Data management tools: the difference between CRM, DMP, and CDP

Although customer Data Management can be described as a framework, it requires companies to have the right technologies. 

Your data software stack could be more or less complex depending on the size of your business and the number of touchpoints with the customer, but, essentially, your CDM strategy will require a combination these platforms: a Customer Relationship Platform (CRM), Data management Platform (DMP) and Customer Data Platform (CDP). 

Each one of them plays a role in your strategy. But what is the difference between them? 

The basis of data management starts with customer relationship management systems (CRM), which are built to engage with customers by tracking their relationship with your company. They only store data if the customer has interacted with the brand in some way, and they are based on historical and general information such as contact, demographics, and notes made by CRM teams.

Data management platforms (DMPs), on the other hand, have been widely used by marketers to serve ads and lead digital campaigns. These platforms focus on third-party anonymized data collected through cookies (that typically expire after 90 days), device IDs, and IP addresses.

In a different model, a Customer Data Platform (CDP) is a software capable of unifying customer data from various sources, internal or external, gathering quantitative and qualitative information from multiple touchpoints between a company and its customer base. It allows you to build a holistic view of customers and their pain points in a granular way. 

Why CDPs are the ultimate trend in customer data management

Although CRM systems, DMPs and CDPs share similarities, they are different when it comes to managing data. Customer data platforms, specifically, have increasingly been used as an integration hub for data systems because they are built to ingest large volumes of data from multiple sources – unlike CRM systems and DMPs.

There were days when marketing segmentation based on DMP persona segments and CRM was enough, but today, brands are expected to personalize every step in the customer journey – which is only possible through CDPs.

A study by Forbes shows that 53% of marketing executives are using CDPs to engage with existing customer’s needs, increasing the likelihood that they will become recurring clients.

The focus of CMOs is also shifting from third-party data and anonymous data to first-party, single customer data, which also underlines CDPs’ importance. As data privacy and compliance regulations arise, organizations also seek to work with their own, integrated data.

CDPs are capable of providing marketers with a historical record of identified customers that can be used not only for advertising but for other purposes as well.  By centralizing information in a single platform, companies can optimize resources and avoid having to rework their data over and over through different systems. 

Bonus tips for successful data management

Make data widely available to different teams: The Harvard Business Review study we mentioned before reveals that 80% of a data analyst’s time is spent on just discovering and preparing data. Customer data can be an important asset across departments, so it’s important to centralize access to it instead of storing it in separate departments and warehouses. Let the data flow!

Always keep data governance in mind: Understand the privacy policies of your data tools and ensure consent is integrated into all of your data collection, while also respected in marketing campaigns. 

Don’t over-collect data: Understand exactly why you’re collecting the data your collecting, and which questions your company is trying to answer with them. Resist the impulse to gather too much data “just in case” you need it, without a proper purpose.

Create rules for data categorization: Set up file formats you’ll be using, standards for tags, file-naming, and timestamps. Such standards will make it easier for your team to navigate through the data.

Beware of new data sources: Pay attention to emerging data types, such as those from voice activation devices, geo-localization in smart devices, Internet of Things, Augmented and virtual reality platforms, etc. New data points will eventually require new processing and marketing frameworks.

Still want help defining your customer data management strategy?

Now that you have learned a bit more about customer data management, maybe your next step will be to study data management solutions.

If that is the case, we recommend you check out Arena’s customer data platform blog section to dive deeper into the subject. You can also get in touch with one of Arena’s consultants and learn the specifics about our CDP.

An essential guide to Customer Data

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Customer data is the key to understand customers beyond the confines of your own strategy, which makes you avoid dangerous assumptions to create relevant products and experiences.

Continuously data analysis will help you to come up with strategies that cover the market’s lacking points and elevate your marketing to a more meaningful approach. 

We are witnessing a new customer era. Every company’s engines work daily to think, develop, and incorporate business and marketing strategies that put customers at the center of everything they do. 

This new approach does not strike the market as a surprise. For the past years, with so much information in the palm of their hands, customers became more demanding and more willing to connect with brands that make proper use of their information to deliver more than just basic products and services.

If you have been paying attention, you already know customers value experiences more than anything else these days. This means true engagement will only be achieved by a remarkable customer experience that elevates your brand and creates a sense of connection with your audience. However, planning an exceptional customer experience takes a wide understanding and a sharp knowledge of how to solve consumers’ issues.  

That is why customer data is definitely here to stay.

What is customer data and why does it matter?

Customer data is all the information a company gets from consumers whenever they interact with it. Whether it is personal, psychological, or demographic, customer data help companies clarify facts and avoid assumptions when thinking and refining business strategies related to customer experience.

The importance of customer data is related to the incessant need to build a strong customer understanding. Many organizations have already noticed that, by using data as a pillar, their operations draw near customer satisfaction and proper marketing approaches that return investments and reduces waste. On the other hand, without concise information about their customer base, companies fail to engage their audience and make sense of the many market opportunities datasets provide. 

Customer experiences are tremendously affected by customer data, which means the right data extraction, validation and analysis are crucial to generate accurate outcomes that will enhance marketing and business plans. Customer data matters so many companies have embarked on customer data management (CDM) to correctly address data in their goals and daily work.

With trustworthy data at the palm of your hand, you will feel more confident in tactics to contact, acquire, and retain your customers, keeping their interest, and offering them exceptional engaging interactions. Customer data will also support your financial decisions, assisting you in where and when to allocate your budget.

How is customer data created?

As you read, a massive amount of data is being created. All around the world, people are navigating desktop and mobile devices. It doesn’t matter if they are shopping, replying to an online survey, or filling a lead form to get in touch with a software development company. Each of their digital interactions with brands creates data — which continuously provides the basis for algorithms to produce more data.

According to Deloitte in its Global Marketing Trends 2020 report, 90% of all global data were produced in the last two years, considering more than 26 billion smart devices circulating the globe.

Aware of data potential, the market has amended digital initiatives to maximize data collection, extraction, and validation methods. Big data analytics have been embedded to extract useful information from huge datasets, such as CRMs, that can’t be manually validated. Simultaneously, data scientists have been growing as popular as the need to adopt a data-driven culture. 

These market signs alone are an extremely important indication that data is everywhere, and companies that don’t welcome it proactively will be in a tight spot.

Types of Customer Data

Customer data is separated into four main categories. In their own way, these categories will help you enhance the customer experience in different and empowering perspectives. 

Personal data

Also known as identity and basic data, this type of information allows customers to be recognized by individual details and is divided into linked and linkable information.

Every information that can be used to identify a person without extra details is linked personal data — full names and emails, for example. Date of birth, physical address, and phone numbers are linked personal data too.

Now, linkable information doesn’t identify on its own. Still, when combined with other pieces of information, it is useful to draw a bigger picture. ZIP codes, age, gender, job titles, education level, marital status, and number of children are examples of linkable personal data.

Interaction data 

If you ever wondered how your customers behave on your website, or how they interact with your emails and your social media accounts, interaction data will answer all of your questions.

Sometimes known as engagement data, interaction data brings a meaningful and solid viewpoint of how customers interact with your brand’s touchpoints. 

Examples of interaction data are: Time spent on your website, page views, social media engagement, traffic sources, customer service feedback, and paid ad conversions.

Behavioral data

If you want to know how customers respond to experiences with your products and services, pay attention to behavioral data. 

This type of data assists you to have a deeper understanding of behavior patterns your customers have throughout the purchase journey. This means interaction data may or not be considered behavioral data — it depends on the big picture and the goals you wish to achieve.

Some examples of behavioral information you can track are: Previous purchases, website heat-maps, customer loyalty program usage, repeated actions related to your products, and CTAs clicked. 

Attitudinal data

The fourth and last type of customer data is related to how consumers perceive your brand. Unlike metrics you can easily measure, such as product purchases, click rates, website visits, and social network interactions, attitudinal data refers to emotions and individual opinions. It embraces feelings, which makes them highly subjective — that explains why this type of data is also referred to as qualitative data. 

Continuously mining through attitudinal data will get you closer to proactively responding to consumers’ issues and anticipating trends they might be interested in. This is the perfect chance to get to know your consumers’ individual preferences and their point of view towards topics that interest you.

Attitudinal data examples are: Customer lifestyle, motivations, pain points, sentiments, and desirability. Customer reviews are excellent to gauge this sort of information.

Collecting customer data

As we have already emphasized, digital transformation has made every channel a powerful source of customer data. If your customers are interacting with your marketing and shopping channels, you can easily extract customer data from them using Customer Data Platforms (CDP).

There are several ways to collect customer data from distinct data points, and they depend on your goals.

That being said, before jumping to conclusions on which channel is the best to collect data from, make sure you address your data goals first. Is it to accelerate revenue? Develop new products? Get a more precise understanding if you ought to invest in a new marketing campaign? Start with the why, and then move forward.

More than predicting upcoming trends, recall that customer data should be highly attached to things that happened in the past. Past customer sales, buying decision patterns, abandonment rates (and much more) can be extracted from customer data to develop better strategies that respond directly to what your consumers did and said months, weeks, and days ago.

We have compiled some collecting data options ahead.

1. Website Analytics

Web analytics reports are excellent to understand what is resonating with your audience and how they are talking back to you. 

When investigating this type of report, remember behavioral data insights can be extracted from heat-maps, bounce rate, page views, and even the devices your target market uses the most.

2. Social media engagement

Social media-based data can tell you a lot of things. Shares, likes, and comments on social media are basic engaging metrics you can measure to understand what customers think about your brand and what type of message they enjoy. You will likely get a good amount of data from social media analytics to make sense of customers’ sentiment towards you.

We highly recommend you to go even further and run social listening while analyzing social media insights. This will guarantee you interpret your customers’ interactions more accurately.

3. Customer interviews and feedback surveys

Feedback is crucial. Whether customers love what you’re doing or criticize it, you need to be available to take their considerations and opinions into account.

When done right, customer interviews, and feedback surveys will gather your audience’s interests, opinions, preferences, and how you can improve your products and services to serve them better.

Another data collection suggestion is to investigate customer churn. This explains the reason why some customers buy from you for a while and then leave. What affected their experience so they felt like not coming back? Is there anything you can do to improve this experience and avoid other customers from turning their backs on you?

If you’re looking for ways to extract behavioral and attitudinal data, consider searching for customer feedback and combine this information with other data to get a bigger picture.

4. Contact information 

Contact information is vital to customer data. If you wish to communicate with your consumers, you should know where to find them according to the stage of their journey.

From phones to physical addresses and social media, contact information is needed to build a good amount of personal data you can rely on.

5. Customer service

Customer service is related to feedback but contains high potential itself. It is critical to allow customers to reach out to customer service software enabled to bring useful data your way. 

As a consequence, customers can quickly seek help for big and small issues and solve their problems more easily all while providing you with more information.

Validating customer data

As vital as it is, customer data is useful when you are ready to properly extract and validate it. This means you need to find actual helpful information from your data sources, and pull them out to understand how valuable they are. This is what we call data extraction — and it will prevent you from swimming in a random sea of data.

Data extraction uses the right tools to streamline data from customer experience to marketing, and makes sure the information provided is useful for your teams to make better decisions.

To avoid wasting all the money, time, and effort you put into collecting data, there are some essential considerations about customer data validation you should pay attention to:

  1. Customer data must be a source of truth and facts about your audience: Above all things, remember customer data is supposed to assist you in using factual information to come up with fitting solutions. For this reason, the data you extract must be reliable and revolve around your clients. If the data you’re extracting isn’t customer-centric, you better reconsider why it is important.
  1. Customer data must be goal-oriented: Exploring multi-channels to extract data from without a clear goal in mind might lead you to conclusions that don’t make much sense. Make sure you know what your goals are from the beginning and set milestones to measure your progress. This will help you visualize how much data is affecting your operations and what else can be done.
  1. Customer data must be integrated: Thanks to technology, data can now be transferred from one channel to another in a matter of seconds — and that is essential to every company that needs fresh information to anticipate opportunities and maximize their potential. By using customer data integration (CDI) tools, you ensure information gets to the right people and set a pattern to collect, organize, unify, and visualize customer data wholesomely. Best of all, CDI automates these processes and cuts down routines that take time. This means your human resources will have more time to focus on what they’re good at: Finding perfect responses to all the data software and algorithms have extracted and assembled for you.
  1. Customer data must be contextualized: In-house data, also known as first-party data, should be combined with external data to give the information you’re putting your hands in a more precise context. There are two types of external data you can blend with your in-house insights to ensure a broader understanding: second party data and third party data. The second party data is the information provided by another company towards the audience that interests you — this type of data is usually shared between partners. In the meantime, third party data is collected by companies that don’t have a link to customers and sell information to other organizations. These data types can enrich your first-party data and elevate your insights.

Customer Data Analysis

Customer data analysis is crucial to any customer data strategy. Wrong data analysis might cause disconnected and poor responses from brands to erupt and bother customers with interactions they don’t need nor asked for.

As complex as it might sound to gather validated data to be analyzed, some special technologies can help the process be smoother and more efficient. Data mining is one of them. By mixing machine learning, statistics, and artificial intelligence (AI), data mining can analyze loads of data using sharp techniques —and the greatest thing about it is that its analysis is automatic.

Analyzing quantitative data

When it comes to quantitative data, you might come across the need to categorize it according to some classifications and segmentations. Or, perhaps, you will notice it is necessary to relate different data points and comprehend how specific characteristics affect the customer experience. Luckily, data mining provides many programmatic settings that can be adjusted to return the insights you are looking for. 

If you’re willing to fragment customers to create more dynamic and creative ads, customer data analysis will help you find segmentation opportunities. If your team needs to associate behavioral patterns to develop a new campaign, customer data analysis will gather helpful information to predict how people will respond to your strategy. The opportunities are countless.

Analyzing qualitative data

On the other side, when we talk about qualitative data, many companies face the challenge of making sense of subjective information, such as sentiment. People’s emotions and feelings vary individually, and being stuck in the middle of so many variations is an uncertain place for your company to be at. If you’re wondering how to absorb valuable insights from this context, we have good news for you: there are ways technology can track important keywords to translate qualitative data into actionable decisions.

When analyzing qualitative data, pay attention to patterns that might make the situation clearer. Are your customers using the same keywords when they give feedback? Are the stories they tell somehow similar? Are there common elements in the ideas they communicate that can help you create a further sense of how they feel about your brand?

Take advantage of what customers say to you in feedback interviews, surveys, and methods of the sort, to gather enough data and take action. 

Benefits of Customer Data Analysis

Relying on customer data will benefit you in countless ways. To help you understand how, we’ve listed some benefits in-detail right ahead:

1. Segmentation

Segmenting your customers is a smart way to get a broader view of what their issues are and how you can reach out to them more effectively. Separating them by age, demographics, gender, job title, and more makes it easier to plan specific marketing campaigns that will straightforwardly attract them, whether your goal is to attract them, engage them or make them buy more.

2. Personalization

People no longer wish to be contacted with general messages that lack a personal touch. Customer experience is a synonym of personalization and, if you don’t use data-based strategies to customize interactions with your consumers, it is highly likely that they will get frustrated by irrelevant content and mass communication. In contrast, personalization increases service quality and customer satisfaction.

3. Deeper audience understanding

Data is becoming the centerpiece of companies that desire is to remain relevant in customers’ minds. This happens because, without a detailed and precise understanding of their audience, companies will hardly add value to their customer base. 

Customer data is the key to understand customers beyond the confines of your own strategy, which makes you avoid dangerous assumptions to create relevant products and experiences. Continuously data analysis will help you to come up with solutions around creative, data, and media — the right combination to empower your marketing and business approaches.

4. Revenue

When used correctly, customer data helps you understand how to increase your consumers’ loyalty and lifetime value, reducing churn at the same time. It also gives you a better understanding of where to invest in valuable campaigns and trends that will bring you more ROI.

5. Humanization

Human connection isn’t just another trend. The fact customers need to embrace companies with a purpose is changing their relationships with brands. People don’t want to be treated as a transaction. On the contrary, they expect companies to act authentically and be transparent in what they believe in, treating them individually. Pulling the right customer data contributes to humanize your brand so it corresponds to these expectations. It also frees your team to have more time to focus on how to genuinely engage customers. 

Data-base your decisions

Now that you’ve come to the end of this article, you know there isn’t space for assumptions to guide your brand’s decisions anymore. More than ever, new ideas and improvements need to connect with customers’ expectations. In this context, embracing the right technologies to collect, extract, validate, and analyze data is crucial. 

To find out more advantages that the use of Customer Data can provide for your company, contact one of our consultants, and resolve any doubts on the subject.

Data-driven marketing: learn how to work it with your customers

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Data-driven marketing belongs to a new customer service approach that unleashes companies’ potential to make better, scalable marketing decisions and benefit from higher marketing ROI. It represents the future of customer experience and meaningful branding messages.

You already know what people say: Knowledge is power. Facts, information, and skills acquired through experiences are gold mines for every company that wishes to stand out and stay relevant in their customers’ minds.

Customer data platforms tells marketers everything they need to know about their target audiences. Through digitalization and its multi-channels, it became possible to trace people’s actions across the digital and physical worlds to optimize the process of offering customized products and services that match individual needs.

However, these days, data must be smooth to access and easy to visualize. This happens because customers want quick responses, which timing and effectiveness are highly affected by delays and assumptions.

In this unforgiving environment, are you confident that your marketing decisions are based on facts? When important events on your field take place, how quickly can you respond to them? How many customized experiences do you actually deliver to your customers?

If the answers to those questions concern you, you’re at the right place, at the right time. Get ready to know how data-driven marketing can take you closer to the answers you wish you could give.

In this article, you’ll find out:

  • What is data-driven marketing;
  • Data-driven marketing benefits;
  • Impacts on customer experience;
  • How to work data-driven in consumer segmentation;
  • And examples of data-driven culture.

With that in mind, let’s move forward.

What is data-driven marketing?

Data-driven marketing is a strategy that uses customers’ reliable information to personalize whole marketing communications and experiences. From buying journeys to targeted media and in-store service, data-driven marketing accesses massive information to leverage decisions and make the right judgment about what customers need. This helps marketers to refine strategies based on facts, not guesswork.

But where does data-driven marketing get all the information from?

When you use your phone’s mobile apps or desktop devices to web navigate, you’re leaving traces all around the internet. The applications you use are designed to send data to companies so they know what websites you access, with who you’re interacting with, the locations you have been to, and more relevant information that clarifies your individual preferences and lifestyle.

Many organizations are already worried about data, but we must call attention to the fact that data-driven marketing goes beyond data itself.

The many devices, platforms, and other types of media you use are surely whispering into marketers’ ears over and over to help them build fact-based decisions that match your expectations. Even so, data-driven strategies merge a high-powered amount of digital and offline channels to give context, collect information, and arrange it in ways that are easy to visualize. Data-driven marketing aims at amazingly-designed customer experiences, but influences internal operations in ways companies have never seen before.

With so much information being generated at all times, data-driven marketing unites the right tools to track, segment, and optimize strategies. When used right, this groundbreaking approach will help you to invest in the right interactions to increase customer retention and bring you more marketing ROI.

Data-driven marketing benefits 

Now that you know the importance of data-driven and how it is revolutionizing marketing strategies, it is time to highlight some of its many benefits.

Segmentation

Data-driven marketing is the key to build marvelous customer experiences based on well-designed segmentation. The first step is to select the right customer segment to drive marketing efforts into. After that, you will be prepared to work on specific, tailored tactics to sharpen your customer touchpoints, whether they’re potential or not.

By segmenting a target market, it gets easier to develop products, solutions, and approaches that will attract the right people to your brand. Segmentation also provides transparency when you wish to know how your campaigns are resonating with the public and gives you a better understanding of particular users’ behavior.

Customer acquisition

Four essential questions must be answered very carefully when you decide to attract target audiences and contact potential customers:

  1. What message will you tell them?
  2. How will you communicate with them?
  3. When will you reach out to them?
  4. Where will you find them?

In a data-driven approach, all of these questions will be respectively answered based on:

  1. Goals and pain points;
  2. How they behave;
  3. The best timing according to their routine;
  4. And the digital and physical places you’re more likely to meet them.

Even if you have a large number of customers, it is possible to combine data to deliver special, tailored touchpoints that match their behavior and preference. It could be an e-mail, or an SMS, or a live event. Possibilities are countless, but you will surely pick the best ones once you know what customers expect from you and how to engage them.

Data-driven marketing works efficiently when it comes to continuously deliver interactions to match customers’ expectations throughout their journey. With so much information at the palm of your hand, you will be ready to transmit the right message (what) at the right time (when) and place (where).

Revenue

Every company director loves it when technology saves the day by cutting costs and returning investment. Gladly, this is pretty much the case with data-driven marketing.

According to the Forrester report “Insights-Driven Businesses Set the Pace for Global Growth“, data-driven organizations grow 30% per year more than companies that don’t base their strategies on data.

When we take a good look at different markets, it gets even clearer that data-driven strategies embody assertive communication that makes ROI possible.

Custom-made marketing campaigns reach proper audiences, which leads to customer acquisition, which leads to customer engagement – and ROI is coming back to you in each one of these stages. Not to mention the revenue currency that comes from these approaches.

Revenue is also possible by cutting costs, reducing churn, and democratizing information through different companies’ sectors.

Upgrade your marketing strategy

Automation was already a buzz when CRMs arrived to transform the way marketers dealt with customer data. From purchase details to personal information and preferences, CRM was and still is prepared to collect digital data at higher levels. This allows big data to play a more predominant role in marketing: Data is now at its core, deciding the directions companies should take to reach their goals.

It must be said that collecting data became a more complex task, especially when you take the number of multi-channels available these days. Still, this complexity isn’t an excuse: If brands don’t automate operations related to those channels, they will lose way too much time putting effort into what can be automatic, and marketers won’t be able to strengthen their creative side and propose remarkable tactics.

Fortunately, there is a considerable amount of data-driven tools that optimize, clean, and filter important data from multiple sources, whether they’re 1st (directly extracted from customers) or 3rd party (found in the market).

Data-driven marketing automation saves you time, money, and free your team to focus on more important tasks that require human abilities, such as creativity. That is how you truly upgrade your marketing strategy: By quickly analyzing qualitative data and returning a creative response to customers’ issues.

This means a wider customer reach, more relatable content, targeted ads, and personalized customer journeys – to only quote a few.

Don’t forget that numbers and reports play a crucial role in data, but the outcome will only be useful if the human eye analyzing them gets the right insights and develops accurate replies to get closer to customers.

Impacts on customer experience

Lincoln Murphy, known as the Customer Success guru, says that Customer Success is only achieved by combining what customers need to an appropriate experience while delivering the right interactions. As you know now, this has everything to do with data-driven.

Data-driven marketing is a new shift in customer care. It prioritizes customer experience in smart and strategic ways, such as we have never seen before.

Many marketers around the world have embedded data-driven strategies into their routines, taking their time to analyze information that will drive to ideal customer experience. With so many benefits, data-based decisions impact consumers on profuse levels. Take a look at some of the impacts:

Personalize customer interactions 

Needless to say, real engagement is closely related to giving customers a personal touch in everything you do.

Irrelevant content, general messages, and ordinary offers will only frustrate the current consumer. People expect brands to customize every touchpoint and suit them to previous steps of their consumer journey. This means companies need to enrich and individualize communications that work in a one-to-one approach to get in touch with customers and prospects.

While 74% of consumers feel frustrated by irrelevant content, 56% of them would reward personalization with a purchase.

Data-driven tactics are the perfect response to this personalization requirement. It allows you to incorporate consumers’ inclinations, pain points, and attitudes to deliver personalized experiences both in digital and physical fields.

Content personalization also turns your communication more persuasive, improves customer conversions, and boosts engagement.

Improve products and services

Products and services can also be personalized and better designed to respond to buyers’ expectations. Analyzing clear data will help you understand whether you need to develop a new product or give an existing one new functionalities to match your customers’ needs. This kind of information also guides you to make the right decisions on when to invest in innovation and when to change small details that make a difference.

Besides, data-driven marketing ensures companies always keep an eye on the market to launch tailored, untried products. Data will assist you in when to launch something new, to know how much people are willing to pay for your products and services, and what can be enhanced to increase customer satisfaction.

Ask for feedback 

Another way data-driven marketing impacts customer experience is via feedback. Remember that people use social media to discuss brands and experiences, and when they talk about your company, you should be the first to know. Practices like social listening will help you monitor what people say on social media networks and collect precise data to gather feedback and insights into what’s working and what needs refinement.

Predict customer trends and market changes

Customers are avid for brands that can communicate and act based both on their individual preferences and what’s going on around the globe. Sustainability, social responsibility, storytelling… These are all actual trends that brands should pay attention to while planning their year. Closing your eyes to the market and only focusing on customer behavior is dangerous, as the external environment can dictate what trends will create buzz and what you can do to make people more interested in your brand.

Data-based predictions are important to keep you one step ahead of your competition, especially in times of change. Timing is crucial: Losing the chance to reply quickly to changes and real-time events might harm your brand in ways you never thought possible. With that in mind, make sure you use data to be prepared for change.

Reach customers where they are

Uncovering the best channels for promoting your brand can be a challenge, but data-driven marketing clarifies what those channels are and how your customers use them. This will prevent you from investing unnecessarily in channels that have bad ROI and planning media usage poorly.

With a more concise understanding of trends, you may get a broader view of channels’ tendencies to use them correctly, building more responsive communications. Batches of customers will also benefit from an enhanced content distribution from your part.

Make customers more engaged

Data automation is the ultimate principle to direct creativity into engaging strategies. In the past, marketers could only deliver a few types of customer service — versions back then didn’t vary, and general communication was even acceptable. Nowadays, though, our hectic and ever-changing routine requires more from brands. If you want to truly engage customers and make them loyal to your brand, you better start seeing data as the main resource to achieve better engagement rates.

More interested in experiences than in products, customers these days expect to be listened to and empowered by appropriate brand responses. Not only people are willing to pay more for better experiences — engaged customers are ready to invest emotionally in brands, and this is vital to any long term customer relationship.

Besides making you relevant in consumers’ minds, engagement pays your bills. Companies that have improved engagement increase purchase frequency and order sizes. This keeps revenue coming in and customers satisfied with relevant buying and connection experiences.

How to work data-driven in consumer segmentation

To apply data-driven marketing in your company, you need to be ready to extract, treat, compare, and analyze digital information from multi-channels, transforming it into knowledge.

We know this multi-channel information means millions and millions of data coming from social media, website analytics, cookies, CRMs, consultancies, market data, competitors, and more. But, thanks to technology and digital transformation, data-driven companies use analytics and algorithms to filter and select types of data that matter the most to them.

There are data-driven solutions — software and methods — that will help you segment your customers and visualize information in intuitive reports. With the advances of machine learning and artificial intelligence, machines gather data around and bring it to you whenever you need it.

One of these tools is the Customer Data Platform, also known as CDP. A CDP should provide you with the right insights to create personas, attract and qualify leads, create new content strategies, and develop customer relationships.

Be aware that marketing segmentation is a key-strategy when it comes to the data-driven mindset. Separating customers by interests, job titles, age, location, gender, and more is an amazing strategy for companies that wish to come up with outstanding marketing strategies instead of sending mass emails and trying to acquire leads through general advertising. Segmentation will pull you closer to generate real-time audience engagement.

For example, in 2015 Very.co.uk combined customer preferences with data about the weather to create personalized homepages to attract consumers to their e-commerce. In the process, 1.2 million versions of the website could be displayed, matching customers’ interest. For example, if you were looking for homeware, your homepage would bring special promotional messages that had everything to do with the products you were looking for. It is completely personalized — and that was only possible because Very.co.uk data scientists created complex algorithms to predict customer behavior.

Nubank, the largest Fintech in Latin American, is another company that embraces data-driven marketing to customize the customer experience. Nubank created ‘wows’, the name given to specific gifts customers receive when assistants feel a special type of connection while serving them.

Every gift is designed especially to the customer, considering their preferences and context. Nubank recently gave a consumer that owns 85 dogs a box full of dog toys, bone-shaped letters (written to the customer herself), and a device that throws dog treats in the air.

Examples of data-driven culture

Data-driven marketing has been so relevant it is leading a policy of its own, known as data-driven culture.

Data-driven culture allows organizations to replace opinions and guesswork with data-derived facts. Here, data is the main resource for collecting and leveraging insights in every company’s department. For this reason, all operations and routines will revolve around it, creating a new decision framework that relies on collaboration to move, integrate, and combine data more efficiently.

This means information must flow effortlessly through people, processes, and solutions so decisions can be made in a matter of seconds. There is no time for waiting: Business intelligence, technology, sales, product, marketing, and many other teams must have quick access to data to enhance customer interactions as swiftly as possible.

To give you a real case example, The Coca-Cola Company in Brazil assembles a data-driven culture to machine learning and AI to analyze its market and consumers. From three to three months, Coca-Cola employees set goals based on data and measure their progress through indicators and continuous information exchange.

It is also interesting to mention that Coca-Cola uses digital as a leading measurement tool and values people diversity to boost collective learning.

Worldwide, Coca-Cola is also known for its successful data-driven campaigns and agile mindset. In practice, data helped Coca-Cola deliver the Cherry Sprite flavor, which was inspired by the fact many customers mixed their drinks in self-service drink fountains. It also drove the company to create personalized AI assistants for vending machines that can behave differently and allow consumers to personalize drinks.

To mention one more example, Coca-Cola has been using data-driven marketing to track photographs of its drinks on social media, using image-recognition technology — this allows the company to target customers and deliver more efficient adverts, considering their consumption behavior.

At the end of the day, it’s clear to see that companies that have absorbed data-driven culture are completely different from companies that haven’t. Data-driven companies achieve tremendous results by dealing with complex multimedia channels — like videos, social media, ads, email, and liveblogs; — to reach customers with the right message at the right time. This ability is closely tied to automation and analytical approaches, which permits operations to be optimized, and audiences to be attracted more effortlessly.

Data-driven marketing is the future 

We know making the best marketing decisions is a challenge as much as it is a basic requirement. Moreover, facts tell us the future of organizations will be decided by the ability to use data wisely — and we know you don’t want to be left behind.

Arena helps media companies all around the world to encourage engagement and streamline customer data to smart marketing campaigns.

If you’re willing to be assisted by a Customer Data Platform to boost your audience and work data-driven marketing with your customers, get to know more about how we can create powerful experiences for your users.

Real-time audience: everything you need to know for your business

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What do you know about real-time audiences? Here’s all about it and how to use this strategy to make your brand a reference online.

Did you know real-time audience monitoring is a must on marketing strategies? It’s basically a way to see what your public is doing and talking about your brand at the right moment the discussion is happening.

Certainly, everyone working in a marketing team knows the importance of controlling audience engagement. However, given the newness of this innovation, some professionals might not quite understand the significance of real-time audience tracking yet. Just a few years ago, marketing tools gave complete reports on a daily, weekly, or monthly basis about the brand’s audience.

Nowadays, some tools like the Customer Data Platform enable us to observe in actual time what are the company’s mentions throughout the internet. Because of this, a few things become viable, like improving customer segmentation, finding ways to have more engagement, and gathering more data on customer online behavior.

Since more data is available, that means better content and offers can be created for each consumer and segmentation group. Moreover, live content is also a new thing in the market. Although you might think of videos when you hear this term, blog posts, chats, and even more are a part of it too.

Experience dictates that consistency, frequency, and quality are what it takes to be successful in a digital marketing strategy. But now, that should be completed with real-time conversations that attract people’s attention and make them eager to have a conversation with the brand. 

In order for that to happen, the first thing you need is to understand the concept of real-time marketing and its benefits. Keep reading to see what we’re talking about.

Importance of knowing your audience

Communication is not easy work. Even when it comes to our families and close friends it’s common to get things wrong. And these are people who we spent most of our lives talking and getting to know each detail or their personalities. So, as a company trying to reach out to a customer, you can see how the conversation could be inaccurate if not done the right way.

That’s why it’s extremely important to work around the customer. Knowing who is your audience will help understand what they like and want out of your business. In order for that to happen, you need more than a name. That is, to gather information such as demographic and online behavior. From this type of data, it’s possible to be aware of how to deal with the brand’s public.

As a result, this is a crucial factor to provide better results. Some platforms even allow real-time data collection, which means the information will be stored from the first visit a person makes to your online page.

From this, new strategies based on real and accurate data can be planned, giving the customers what they want and the company better outcomes. Ultimately, there’s no point in having the best solution ever and the most perfectly designed products if you’re not getting the right people to see and try it out.

Real-time marketing benefits

Real-time audiences is not the only real-time strategy to work with. In fact, these days it’s possible to keep track of everything at the moment it is happening. Naturally, you need technology assistance for this purpose. It’s inconceivable to have a group of workers trying to handle all of the real-time data and its analysis hand-operated.

Still, with a CDP solution (for example), the company gets everything under control. The benefits of obtaining a real-time strategy include:

  • data collection from the first visit;
  • data analysis and storage;
  • real-time action and content;
  • customer segmentation;
  • personalized content;
  • increase in audience engagement.

First and foremost, real-time data collecting happens when a software,  like the CDP, starts gathering information about a visitor from the first moment they enter the company’s page. Even if they don’t interact or buy anything, their behavior is already being observed and stored in a database. 

Better yet, real-time action can be taken too. If you notice a visitor is acting in a way you can intervene and have them closer to taking action, that’s possible.

For example, someone clicked a product and added it to their cart, but gave up when they saw shipping costs were high. If the marketing team notices at the right time (a.k.a., real-time), they can work to create and send a real-time offer to that customer saying something like “hey, did you know you can get free shipping on purchases over $20?”.

Solutions like live blogging and Live Chats are also included under real-time marketing strategies. These attributes give your brand better outcomes by adding value to your product and content; increasing team productivity; improving customer experience, and building a follower base that’s more loyal to the brand.

More than that, all of the customer behavior will be kept in a database for future plans, such as knowing and finding new segmentation groups. Working with a system like a Customer Data Platform, the process, and the separation of single customer profiles into larger groups with similar interests will be automatized. So, not only you can work with a group segmentation, but also with personalized exclusive content and offers for each individual consumer.

Hence, this will assist in defining the target audience for each ad campaign the marketing crew has in mind. Real-time data collecting will also lead to an audience size increase while allowing the company to identify who are customers and who will be classified as leads — certainly, this will broaden the understanding of your audience.

Have you heard about liveblogging? Because real-time content should also be considered an advantage for a marketing group. It is the perfect way to share breaking news, talk about events that are currently happening, and even behind-the-scenes content. It doesn’t necessarily need to be planned ahead, it’s a kind of content that should be simple, spontaneous, and time-saving.

That’s exactly why it will catch people’s attention, it’ll make your brand more humanized with a language that’s closer to the audience’s day-to-day life. It’ll make them relate better and feel a part of your business — thus, increasing audience engagement. Besides, real-time content yields more audience insight, which will lead to learning what are the audience’s favorites, analyzing new data, and creating new compatible segmentations.

Of course, a balance between planned and previously written posts plus real-time content needs to exist. At the same time, you need to create a brand that’s first-hand connected with the audience, you should keep providing personalized and SEO optimized content. The combination of real-time data collection and real-time content will definitely improve your overall strategy.

How a CDP will support communication

To understand better how a Customer Data Platform will help in this case scenario we’re talking about, here is some important information about it.

By using a CDP solution, a company will have lots of valuable data. Yet, there’s even more to that: this software already processes data to analyze what is relevant and useful information and what is not. The type of data a CPD collects can include:

  • customer identity (name, age, demographic);
  • hobbies and interests;
  • online behavior;
  • how much time was spent on a page;
  • what products were bought;
  • what products were returned;
  • number of abandoned carts;
  • etc.

Much more information can be absorbed, but the important thing to keep in mind here is what you can do with all of that data. As a head of marketing, having the perfect image of a consumer makes a total difference in conversion rates. Of course, because that knowledge makes it possible to create the most accurate content for the brand’s audience.

Instead of waiting weeks to see monthly results and create new plans to improve a marketing strategy, real-time audiences and segmentation allow to act upon immediate results.

This not only gives the company equipment to work with but causes an impact on the audience with that real-time action speed. Live-blogging and live-chats features are also a part of what a CDP solution can offer your company.

Surely, there’s the need to see how your company can manage real-time marketing. Will the team be able to keep track of the information? Will they be able to act on immediate results? Will real-time audiences and segmentation bring better results? Once there are positive answers regarding these questions, you’ll know the Customer Data Platform is what your brand needs to reach new levels of audience engagement. 

How data can help create new approaches

Real-time data is a valuable resource for your brand’s marketing strategy. People notice it when a mark does their best to communicate efficiently with their customers. Using real-time information makes the company look active and on the spot, so people will pay attention to that.

When thinking about a solution to collect real-time data, it’s necessary to remember other details. For instance, is it important to work with real-time audiences? What about a Live Blog? What features does the software need to make a difference in your company? It’s important to recognize these factors since they’ll be decisive. 

A Customer Data Platform solution has all of that and more. From this type of system, you get a deeper understanding of the customers and are able to grow your follower base.

Optimize campaigns

The thing is, and I’m sure you’ve heard this before: by delivering the right content, to the right person, at the right time, and through the right channel, your conversion will most likely be a successful one. And how is that mission possible? With data usage.

When you have complete information about the people who are interacting with your brand, you not only get to know them better. You understand them so well that you can actually anticipate customer behavior and actions, something that is essential to optimize ad campaigns.

Promote better content sharing

Having enough data about your audience, it’s possible to show people that you care about them and you want them to have the best experience ever. You want to show them you’re not just another company trying to sell at any cost.

This is why it’s important to plan your content in a way to have more engaging materials than selling ones. However, this doesn’t mean real-time content should be left aside. Both varieties of content need to be a part of the brand’s approach.

Work with stages of awareness

Creating methods to be closer to the client and more assertive with content creation should be part of the main marketing strategy. As marketing professionals, some other things we worry about include increasing social media engagement, promoting events, and, more importantly, identifying who are the visitors prone to becoming new customers and which of those can become brand promoters.

That means analyzing real-time audiences to discern who is ready to make a purchase and who is just looking to learn more about your solutions — understanding the customers’ stages of awareness.

In addition, checking and connecting with who has already bought, approved your product, and is interacting with your brand online by giving good references, especially if those people are social media influencers.

These are just some ways a group can work with data collection. Realizing what is the best trajectory for the company will be the responsibility of the marketing manager. Whether it’s getting new followers, making people share more content, or simply optimizing ad campaigns.

Technology is essential to get the job done

Everything that has been said so far can be summed up in a few words: communication is more effective when you know your audience. Plus, technology is a must-have.

There’s no way you can get to know your public if all employees need to be constantly collecting and analyzing data by hand. Acquiring an automation tool is by far the best decision to enhance your whole marketing processes.

To clarify that fact, these are some of the things a marketing team will be able to achieve with software that gathers, analyzes, and stores data:

  • find the best approach for each customer or segmentation group;
  • know what type of content to create;
  • understand what kind of visual elements will work better;
  • learn the best language to use (slangs, formal, etc.);

As it was mentioned earlier, data collection implies knowing the audience. Because of that, a platform with this purpose will help recognize the best communication path to follow. Including every little detail from the tone of the company to the type of visual elements used. Creating a persona out of this material is ideal.

More than that, technology is necessary to get more tasks completed, such as monitoring social media posts. After all, that’s the communication channel where most of the engagement happens.

Having blog comments and forums supervised as well will permit you to see what the audience wants to know, what their questions are, and what are the gaps you can cover. It’s one of the best sources for inspiration content.

That means there should be constant monitoring of real-time audiences. This way the marketing team will always be precise and straight to the point with the public’s interests. They’ll be able to create content answering exactly what the audience wants to know. Even more, a real-time strategy will boost engagement with the brand.

Despite that, quality content doesn’t do the job by itself. It’s required to know SEO tactics that will improve reach — therefore, increasing shares as well.

Social media is the main channel to have real-time audiences interacting with your brand while making it more humanized. That’s something acknowledged brands are doing in the market, such as Coca-Cola and Airbnb. It’s a way to connect on a personal level with customers and prospects.

The streaming platform Netflix is a great example we can think of because of how they act online. Even though there are many people behind their strategy and social media control, their communication is flawless. 

Every post and every response they write to their fans, whether on Instagram or Twitter, has the same tone and exposes a strong personality — in spite of the company not having a face and body to show “behind the cameras”, you can practically see who Netflix is through their social media work.

Of course, the personality of your brand will depend on the type of service, and the target audience the company works with. For Netflix, that witty and fun characteristic works because it’s an entertainment business focusing on interacting with their young adult fan base.

Then again, this is the reason knowing your customers matters so much. The moment you get to know them, how they act, and how they talk, you have what it takes to transform them into brand advocates.

Are you ready to reinvigorate your marketing strategy? Arena has all we’ve talked about, from real-time audiences and segmentation to live-blogging solutions and more.

The Difference Between Data Management Platform (DMP) and a Customer Management Platform (CDP)

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A data management platform works as a warehouse, collecting, organizing and activating third-party data in a single place. Keep up and find out how to benefit from it!

Data is a crucial resource in this business era. However, it can be useless if the company doesn’t know how to professionally manage all that amount of information, wasting thousands of dollars advertising to an incomplete or insufficient database usage.

In a digital world of first, second and third-party information, a Data Management Platform, also known as DMP, can transform piles of databases into profitable resources. Take a look!

What is a Data Management Platform (DMP)

Customer experience is not a linear walk. They will leave crumbs of information all the way along their relationship journey with a company. That process results in the accumulation millions of data throughout the years from multiple sources.

Most times, those data can seem random, incoherent or fragmented. That may happen when there is no right management of it.

Then, some questions become trivial:

  1. Who are the visitors on my website?
  2. What are they looking for?
  3. How can you have direct contact with them?
  4. Why they are not making deals with me?

A data management platform (DMP) is a tool to filter all those pieces of information into organized profiles for audience segmentation or insights for decision-making.

After that, your company will know exactly who they supposed to talk to; how these audiences behave; what is the best approach along the sales funnel to them; if the investment made in advertisement campaigns has the appropriate segment and more.

You can even create cross-media analysis, which is when multiple platforms, on and offline, can support the same campaign.

How Does a DMP Work?

Operating as a central intelligence system for digital marketing, a DMP creates a perfect definition of your ideal customer by organizing millions of information into demographic, consuming habits, interests and so on.

You can obtain new forms of segmentation through DMP, such as a non-dependent on the context or content one. This new segment is now based on the profile of the audience, regardless of the advertisement subject or the platform displayed.

To function, a data management platform operates in four steps:

Collect

It all begins with data collection, third-party information acquired by relevant partners with similar or identical market spaces. These data can be provided from CRMs, customers’ registration, e-mails, website data, previous purchases and whatever more relevant material is available.

Even though DMP is made to operate third-party data, it also supports some first-party data to improve the information given.

Organize

In this step, the DMP classify the info into categories, grouping them as clusters. Clusters are a type of audience segmentation that combines customers with similar marketing sales behaviors in one file.

For example, it is possible to create a group of customers who has made most of their purchases by ad clicks, or those who spent a certain amount of money in a product or service related to yours, who has more visits in a specific category in a website that might fit your business, etc.

Activate

Now, it is crucial that the data management platform used is agnostic, which means it will be compatible with any digital platform. So, if the company wants to run a campaign for the brand in social media, websites, search engines, etc, it will be just fine. The activation itself happens when the campaign is on.

Learn

By analyzing the return over the investments made on the ads, it will be possible to understand the depth of cluster segmentation. The company will have more domain over the results acquired since the data is much more precise than any other type.

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What Can You Do With a Data Management Platform?

One of the main benefits a DMP provides is the cluster: high-detailed information about customers so you can create hyper-targeted ad campaigns, delivering more conversion rates and increasing the ROI of your company.

Using a DMP, you’ll be able to create accurate segmentation, making the proper usage of your third-party data by giving your audience the right message.

Practical Example

Imagine you run a dental clinic and want to expand your qualified leads base for a specific segment, let’s say dental implants. That is one of the most expensive procedures you have and it is not salable to any type of customer.

Typically, you would create a campaign based on people interested in dentistry or dental implants in a wide range, fitted in average age, near your clinic.

With a DMP, the depth of your segmentation reaches this: men and women, from 40 to 70 years old, who have downloaded some white papers about dental implants, researched a number of keywords that demonstrate the need for professional information and live within 5 km of the clinic.

Here are some possibilities your company can reach with this type of segmentation:

  • Retargeting: easily implement personalized retargeting campaigns based on specific activities and behaviors online.
  • Prospecting: integrate with third-party data sources for the acquisition of anonymous data, achieving greater precision and scale in online campaigns.
  • Website optimization: use your own or third-party data to provide customized content to different consumers when they come to your page.
  • Audience intelligence: cross your first-party data with other third-party to learn more about your audience and reach the people most likely to convert.
  • Better ROI: use an analytics tool that centralizes online campaign performance data to determine which audience segment performed best and where to focus your efforts in the future.
  • Productivity increase: eliminate the bottleneck of needing IT to reach out for your data and have all your teams able to take them out, ready to use.

DMP Benefits for Companies

So far, we have seen in order to escalate your business, having the right audience to talk to is fundamental. This is market intelligence. Your company can no longer have a vague idea of who their customer is. It is necessary to personalize and amplify to get the following benefits:

Cost-Effective Advertising Campaigns

When you have this level of audience segmentation, you can spend every dollar of your budget on better-targeted prospects. Get the return on the investment you need to.

Lower Technology Investments

To run a DMP, you won’t need an extra support. Your whole team, from customer success to follow-up sales, can easily operate the system. As we mentioned before, there is no need for IT.

First, Second, and Third-Party Data Combined

No data is left behind. Even a messy pile of customer information can turn into gold here. As this platform gathers and organizes party data, every piece of a database is important, nothing is wasted.

No Data, No Success

Regardless of the type of industry you are in, uncountable amounts of information are huddled and enter your company through different doors: billing spreadsheets, sales reports, feedback offered by different media, social networks, loss or conquest of new markets, CRM, etc.

Such a thing must be used to leverage business marketing strategies. That is the reason why it is so important to generate an efficient information collection, organization and analysis on a daily basis of a company, as DMP does.

From this, a strategy can be developed over decisions based on information, including those related to strategic and operational marketing. That is the Data-Driven Marketing.

Data-Driven Marketing

Data-Driven Marketing helps, for example, to create a guideline for campaigns using DMP clusters. Besides highlighting the features/benefits/quality/etc of a product or service, it enables a work of relevant engagement with your consumers, delivering exactly what they want.

As a result, communication is enhanced by user experience and becomes more aligned with the needs of its audience.

Strategies will be able to still cohesive and aligned even when using a larger number of channels. Marketing campaigns have been running more frequently in social networks, which is the place where interaction has a leading role.

It keeps getting more essential to own proper knowledge of the market slice you are in. Its audience and characteristics indicate the way your company should brand, advertise and sell their product.

Big Data

When we reach for the definition of Big Data, we find a true technological revolution, making more possible to qualify the results obtained. Big data is a master process of analyzing and interpreting a great volume of data stored somewhere remotely.

Information is available everywhere online in a non-confidential way. No matter how large the amount of information is, Big Data can reach and group them according to interests.

Big data can be used in several business routines. However, to use it properly, it is mandatory to have not only knowledge about the technology, but also to identify which are the touchpoints in your company that will be impacted by its implementation.

By that, it will be possible to make a more efficient allocation of resources and increase the return over the investment in those data analysis solutions. And that is how a Data Driven culture is established.

Thus, the company must act so all teams understand the importance of data integration in the definition of strategies and work based on that!

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How a DMP Can Boost Marketing and Sales Results

Marketing and sales work as the core of the data management platform. This is where it starts, through hyper-segmented audiences. One of the biggest mistakes –– and frequent too! –– of digital marketing campaigns is having an incorrect or too wide segmentation.

Besides impacting those who are not part of your true audience –– and might cause a bad reputation for you ––, there is going to be a significant waste of your marketing budget that may harm your ROI.

Every click or scroll on the screen can generate data. When your marketing strategy is aligned to DMP guidance, you hand over to sales team customers ready to spend their money.

DMP and Sales

At this stage, sales have a unified perspective over the data and better cards to play, such as real-time interactions.

This is a priority in marketing and sales now. A high-performance sales team, which are those with the upper sales amount, increase the chances of achieving their mark by real-time interactions with the customer.

But we are not talking about aggressive and unprepared approaches here. Sales’ strategy must contemplate the best ways to do it based on who is the audience. By that, the integration of the DMP with marketing and sales is crucial for higher performances.

The Main Differences Between DMP and CDP

There are a lot of similarities between Data Management Platform (DMP) and Customer Data Platform (CDP). But there are also some very specific characteristics we need to keep them well established. Here they are:

Data Collection

One of the main differences between CDP and DMP is that DMP uses cookies to track users’ movement and target marketing strategies more efficiently. DMP was developed to search for data on advertising networks.

On the other side, CDP is a technological advance that gathers customer data from different sources and use it to generate more appropriate content, email marketing or offers.

Objective

DMP was designed to create deeper segmentations for the marketing strategy. CDP focuses on improving conversion rates and customer engagement, creating a richer consumer profile with more information.

CDP is also able to capture information from different channels and devices, in an automated way.

Therefore, investing in a CDP or DMP allows you to transform your company, employing more resources and intelligence to the business, and promoting your brand to a great and higher level of reference and success in the market.

How about starting now? Arena has a Customer Data Platform solution for your company. Build your clusters, make better advertisements, and talk straight forward to the audience you need. Click here and visit Arena’s CDP page!

What Widgets are and how to use them on your website

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You’ve probably heard the word Widget before, but if you don’t know exactly, find out now what it is and learn how to use it to drive engagement on your site.

Most times, companies mistakenly think that they need a groundbreaking insight or a super powerful expensive tool to create engagement on the website, generate leads and convert them.

The good news is it’s possible to achieve all that and more, increase ROI and generate brand loyalty using a cheaper gadget, yet highly professional and effective. And that is the Widget!

What are the Widgets

Widgets are functionalities you can add to your blog, website, app, PC or mobile devices in order to enhance browsing experience and add more value to the page without coding. 

Through widgets, your website visitor can have a more personalized experience by getting better and more relevant reasons to engage there. It simplifies users’ access to crucial or specific information, working as a shortcut to the function itself without the need of opening the program or application. 

Great widgets are not a stiff add-on. They allow you to tailor it according to the design and identity of your brand, adapt the information to mobile devices, improve website’s SEO including meta props, are lightweight and more. 

How do widgets work? 

Widgets demand minimal memory usage to work. It makes available some predefined features from the original software or source, whether it’s an application or a computer program.

It may be quite expensive to supply some not available functions you need on your website by coding. Instead, widgets provide the core of what you need in a fast, simple, qualified and cheaper way.

As a result, your website will be more attractive, offering relevant content to the audience. You will certainly improve the chances of them returning more times to you.

How to configure them?

To add a widget to your website is pretty much effortless. Because it is embedded, all you need to do is copy and paste the code to your page. 

When you’ll choose a widget to use, prefer those ones supported by any website platforms, including Google AMP. 

Also, having multiple languages is a strong pro to break geographical borders and expand the business.

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The importance of engagement

Customer engagement mostly represents ways to build a solid relationship with your audience. It is a metric used to define how your audience feels about your activities, campaigns and brand. The more organic it happens, the more valuable it will be.

Engagements occur due to many types of interaction. Restraining to the online environment only,  to engage is when a visitor of your website takes action in your cyberspace because they felt it would be interesting, relevant, fun, beneficial, etc.

It can be measured by the quality of the comments on some content, recommendations, discussions, reviews and interactions. When you have engaged customers, it means you have satisfied them somehow. And customer satisfaction is equal brand loyalty and new incomes. 

Higher ROI, cheaper investment

The cost of acquiring new customers can be 10 times higher than a great marketing strategy to retain them. 

In order to keep them with your brand, making them want to spend their money on you, you must have the right tools to create engagement, and a widget on your website is certainly one of the best options.

How to make customers engage

Offering a personalized and exclusive experience is the main key to create relevant engagement. As we said earlier, the use of a widget can add high value to your website browsing.

This small tool can bring new functionalities to your page, such as interactive spaces, complementary information on any topic, real-time updates and more, turning it all into monetization for your company, because that is what really matters.

Arena has a widget solution capable of engaging your community on your website. Flexible, customizable, lightweight and with unlimited opportunities! Find out how we can help your company.

9 reasons why you should start doing it

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Being all ears to your customers has amazing benefits. It increases customer acquisition and makes them brand loyal. It also improves branding strategies and gives you powerful insights about your industry, connecting you to new market opportunities.

If you don’t want to miss out on these benefits, you better start embracing social listening. 

Reputation is critical to any company that is willing to increase customer loyalty and build confidence in the market. With the many digital channels that allow conversations between customers and brands, organizations from the B2C and B2B sectors work hard to be positively recognized by potential and current clients. One efficient way of generating awareness is to have a strong social media presence and reach out to customers with helpful and engaging interactions.

Still, these interactions can only be valuable if brands are ready to actively listen instead of guessing what people want. 

When customers talk to you, whether they’re feeling good or bad about your brand, they expect you to talk back accurately. The last thing you want is to make them feel like you don’t care about what they have to say – or that you’re not making any effort to understand what they mean.

And that is why you should start using social listening.

What is social listening?

Social listening is the act of monitoring your brand’s social media accounts and channels to search for customer feedback and give appropriate responses. 

In order to social listen, you firstly need to track your brand’s mentions and discussions, which can be done by social media monitoring tools. Only then, you’ll manage to do its core task: analyze conversations’ context to make better and more proactive communication decisions.

Think about an ordinary conversation. When someone talks to you, you listen before replying, right? You do that because you know dialogues and interactions won’t make sense unless you assimilate what’s being stated. When it comes to brands and consumers communicating with each other, the line of thought is the same.

By being an active social listener, you’ll be able to reply to some very important questions: Why are people talking about you? Where and how are they doing it? What do they truly want? How can you connect with them?

These questions can lead to a powerful understanding of how to improve content for your customers, create better relationships with your followers, and increase consumer satisfaction.

We separate social listening into four important actions: find, listen, understand, and take action.

  • By finding, you monitor and track the right places and discussions that gravitate around your brand.
  • By listening, you pay attention to what is being said.
  • By understanding, you address issues that are being presented and collect important feedback.
  • By taking action, you work on solutions that will remedy the situation and make your customers happier.

Practice makes perfect, so make sure you find, listen, understand, and take action continuously.

Why is social listening important?

When customers talk, they’re doing an amazing job for you. Their feedback lets you know what you should keep and what you should change in your business. If you listen clearly to consumers and give them what they need in return, they will remember you for solving their problems. Now, try ignoring customers to see how bad it can get. An unresponsive customer service approach will cost you a high number of consumers that will never do business with your brand again.

A bad brand reputation can be a way to downfall, and we are not exaggerating. Remember what happened to Kodak? It once led the photographic film market but failed to understand people were growing more and more fond of digital photography and went bankrupt. 

We have to emphasize that customer-centric cultures have never been so popular. By putting customers at the center of everything they do, these cultures put efforts into anticipating consumers’ needs and creating proactive strategies to give them what they want: new products, services, loyalty programs, and much more.

Information is everywhere and anywhere and it’s vital to track your brand’s social media to try and be wary of what people are saying about and to you. And that is the very least.

9 reasons why you should use social listening

Ahead, we give you detailed reasons why you should embrace social listening to proactively respond to your followers and consumers.

1. Customers expect you to speak out accordingly

Responsiveness is very important, as your audience expects you to speak out when relevant discussions and events take place. In 2018, a survey made by Clutch discovered that 76% of people expect brands to reply on social media. When we talk about millennials, 80% of takers expect brands to reply and 90% want to get an answer on the same day.

However, recall that an inappropriate response will only frustrate your customers, no matter how fast you’re able to reply.

If you want to make your clients brand loyal and boost customer retention, you better start replying accordingly to what they say — and, by accordingly, we mean you have to thoughtfully understand your customers’ issues to shape valuable responses. Keep this in mind: replying is good, but replying accordingly is what social listening is all about.

2. Have a better understanding of your audience

One of the many reasons organizations keep clear interactions with consumers is to generate and gather high-perspective data that maps their concerns and issues. Social listening will guide you to big pictures that exemplify your consumers’ concerns and how you can act on them.

Combined with the need to have a better audience understanding, social listening offers fresh data to get audience insights related to the public perception of your brand, from competitive analysis — whether in brand or product level — to how marketing campaigns resonate.

By social listening, you can identify demographics, preferences, and customer behaviors as much as the general sentiment about your brand. Once you have tangible reports, you can analyze qualitative data and leverage it to grow your brand strategy and take action.

We will sound obvious, but it’s true: your social listening data will only be valuable if you know what to do with it. For this reason, it is essential to set up a frequency to investigate the information you’re getting and think about how you’ll keep track of the results from time to time.

3. Monitor new industry opportunities

Is there anything that’s trending in your industry that you should know? Any social issue related to your brand that needs to be addressed? Any gap in your sector that people are talking about? Any questions from customers that you can answer better than your competitors? Social listening can help you find the answers to these questions. 

By tracking industry buzzwords and trends, social listening will bring you precious insights about your area of expertise and shed light on discussions that can be amazing opportunities for your brand. That is an efficient way to keep a hear out for market trends, discover what’s lacking in your industry and what you can do to innovate and attract more customers. 

4. Keep track of your brand’s health

Social listening is an effective way of developing better elements that shape your brand in customers’ minds. As soon as you continuously keep track of what people say on the internet, you’re able to make sense of what and how users would like your brand to communicate. Attentively listening to consumers’ feedback is essential to come up with interesting brand strategies.

Social listening is also an excellent way of providing constant investigation towards bad reviews and comments that can affect your brand negatively. Never forget that anything can go viral on social media. Unhappy customers and displeased staff members know they can freely express themselves on online networks and be heard. Social channels empower their voices and reach people who might be going through the same issues. With that in mind, it is completely possible that a single complaint could be reinforced by others and create unwanted attention. 

Being ready to address brand disasters and manage a crisis isn’t overreacting in this fast-paced environment we call the internet — and, trust us, you’ll be glad to have the right tools and tactics to deal with harmful posts and remedy the damage. 

It’s true that you won’t be able to control everything people say about your brand, but you can control how you react to it and mitigate the negative impact. Learn with your previous experiences and prepare not to just reply to undesirable controversy, but to avoid it before it happens. For example, if your launch sales were affected because your website was down, you better start looking for infrastructure tests that will strengthen your website and avoid outages. 

5. Increase customer acquisition 

Another reason you should embrace social listening is that data provided by it will lead you to create content people care about. When you start shaping your content to followers’ preferences, chances are you’ll attract more users that connect with you and have a genuine interest in what you have to say. 

You already know it — expressing your brand message in social media through responses, hashtags, live streaming, and more, calls the attention of content viewers and make it easier for you to convert them into leads. This works better than driving traffic through ads to people who have never heard of you before.

Pay attention to what audiences are looking for and what type of content they enjoy viewing and sharing. Photos, videos, mentions, polls… All of these are instruments you can use to increase customer acquisition smartly and more humanly.

Quick example: Netflix is one of the top-references for brands that want to stand out on social media and attract public attention. With unique humor, Netflix memes its own shows, retweets Netflix-related posts made by followers, and replies with a tone its audience can positively connect with. 

6. Keep old customers engaged

It is quite simple to understand how social listening can help you maintain old customers engaged and retained. If you ignore what consumers say when they reach out to you, it shows you don’t care about their experiences. By neglecting them, you’re paving the way for your customers to switch for competitors that are ready to offer valuable interactions.

Recall that many consumers’ stories are being told on social media, especially those where customers need your support. It isn’t unusual for clients to reach out to brands on Twitter or Instagram to get an issue addressed. Actually, they message and mention your brand on those channels because they expect you to reply and solve their problems quickly. No one has the time and patience it takes to hang on the line anymore. The good news is that social listening can absolutely help you to excel at fast, assertive support, and keep old customers engaged.

Engaged customers are more likely to be brand loyal, especially when you can keep meaningful interactions going on and offer them what quench their thirst for information, interactivity, and good customer experience.

7. Address common issues

If the same questions are made by your customers over and over, how can you make it easier for them to find the answer? If a considerable number of buyers are complaining about the same products, how can you give them a detailed, honest assessment of the problem? These are more questions you can wisely reply to by social listening.

If the big picture tells you your customers have the same common issues, maybe it is time to find out how to solve those issues and respond effectively to them.

Monitoring social media accounts to find these types of problems can make you arrive earlier in the game to prevent more consumers from being affected and provide the right solution to solve the issues of those who have already reached out for support.

8. Get quick feedback

From knowing how you can improve your products to where your audience is willing to communicate with you, feedback can give you constructive criticism about mostly anything. 

Launched a new product? Want to know how your brand positioning is doing? Have doubts if the last live event you promoted is matching your followers’ expectations? What people post on social media will certainly help you get a clear idea about those, and more.

Plus, if customers are talking about something that’s not working, you should be the first to know. Make sure to take their considerations into account and acknowledge their feedback, then start working on what will fix the problem. A new feature? A new product? A new campaign? Getting feedback — and, most importantly, fast feedback — will help you find your consumers’ pain points and understand how to solve them.

Quick example: Starbucks recently released an open letter based on a user’s negative feedback regarding the Black Lives Matter movement. After social listening to the critique, Starbucks used a respectful tone and gave an immediate solution to what the customer was talking about, showing how its employees can now support the movements while working. 

Don’t forget that positive feedback is important too. If customers love a campaign or the tone you’re using to reply to them, make sure you get it to generate more content that will match their preferences.

9. Identify influencers and user-generated content

You won’t be surprised by the fact social networks are full of potential influencers that can help you promote your brand — or threat it. Remember that even people who only had good experiences with your brand can be influenced if someone important they follow feels bad about you (and good about your competitors).

Another social listening advantage is that it allows you to track user-generated content to keep your followers updated. Being continuously connected to monitor what digital influencers say and do will lead you to understand who you can partner with. Search for hashtags, keywords, accounts, and more to keep your brand aware of what’s going on in real-time. You can also start mapping people who your audience connects with and listen to what they say so you don’t miss out on collaboration opportunities.

The role of social listening on live streaming

It’s no secret to you that people love when you go live and cover news and events as they happen. Live streaming has become extremely popular in the last years and it is a gold mine for brands that want to keep relevant by connecting with customers in real-time. The spectator customer profile is being replaced by the active customer, who wants to join brands in emotional and thrilling experiences.

But how do live events and streaming connect with social listening? Well, social listening is a powerful tool when it comes to combining the right strategies to go live.

From sports games to elections, live streams are effective event coverage mechanisms that allow customers to participate in what’s going on even if they’re far away. Meanwhile, social listening uses social streams to monitor and interpret the viewers’ behavior and comments to get insights.

When done right, social listening can be unbeatable in content creation. The reason why is that live streaming gives you engaging methods, such as live discussions and Q&As, that will transform into data — and, as you know, social listening will turn data into action. 

At Arena, we recognize the power of social listening in social streams and event monitoring.

Our social monitoring stream tool publishes content from different sources automatically or manually and provides results coming in real-time. You can adapt filters and search parameters to improve results and post the freshest content to engage your audience. Besides, our social stream feature easily integrates your search stream with Facebook, Twitter, Instagram, YouTube, Reddit, and more personalized RSS feeds.

[Real case example]

Grow your brand by social listening

We’re a bit biased, it’s true, but Arena is ready to empower companies to grow their audience in their websites by creating meaningful live experiences.

So, if you’re considering having a social monitoring stream and finding interactive ways to get in touch with your followers, we recommend you keep an eye on ongoing discussions related to your brand and make your own website the go-to place for relevant, instantaneous content.

It’s easier to be an authority in your field when you’re able to mix different sources and formats automatically into your website, all while providing your customer with an exclusive space for debating and chatting. Fortunately, we have the perfect tool that will do that for you.

A live blog will give your brand the chance to use a smart variety of tools to cover a particular event and engage users that are watching remotely.

By using it, you can publish news to your website as they happen, all while adding users’ reactions from social media and witnessing in-progress-discussions on live chats. Our tool is highly customizable and handles in-feed comments, connects with your video platform, creates polls, and posts social content that engages and keeps your followers updated.

Join us and be able to:

  • Increase time spent on your website
  • Let users engage with your posts
  • Automate content distribution
  • Cover field events that matter to your customers

From bloggers to large enterprises, from Oscars to Super Bowl, Arena is ideal to manage any type of live experience and to help you grow your brand by social listening.

Want to capture audience attention and feed your followers with fresh content at all times? Learn more about the subject in our Live Blog article!

Listen to your audience – and take back its ownership

When talking to your spectators and customers, you assume they’ll talk back to you. This dialog and communication are what, for the most part, define audience engagement.

In general, the question “what is audience engagement” has many different answers, but all of them will lead to the same essence. Keep reading to learn our Ultimate Guide to Audience Engagement.

Complete guide to Customer Experience

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Customer experience is one of the new frontiers of marketing. Customers, in the market powered by industry 4.0, are more interested in the experience than in the product itself. In fact, according to a research held by Momentum Worldwide in 2019, 76% of the participants declared to prefer experiences over things. 

This is closer to our own lives than you might think. Have you ever felt so well treated by a company that you eventually became their client for life? Or that a salesperson seemed to know your needs so well that you made an impulse purchase right on the spot? 

On the other hand, have you ever found it so hard to navigate a website that you couldn’t find or buy what you wanted? Or had to wait so long for technical support on a product or service you bought that you never used that company again, nor recommended it to anyone?

All of those situations have to do with the same business aspect: Customer Experience. Miles away from that simple and old idea of mere customer service, it is one of the biggest marketing trends today. And it involves reconfiguring your whole business around the idea of providing a customer with what he wants and needs, before he or she even knows they might need it.

Want to know more of how that works? Don’t worry, we got a simple and complete guide to help you improve your “CX” in no time.

What is Customer Experience and why is it important?

Customer Experience, also known as CX, is the summary of every physical or virtual interaction a customer has with your business. It is the sum of what defines his or her perception of your brand, starting from the very first contact up to their level of satisfaction at the end of their experience.

Simply put, CX is one of the most fundamental parts of Customer Relationship Management (CRM) because it is what will decide if any individual that comes in contact with your business will become a repeat and loyal customer. 

From your website usability to how your employee treated them, and how satisfied they were with your product, every piece of the puzzle will define how happy your brand made them – and, most importantly, if they are willing to come back.  

In addition, a happy customer is not only a loyal one. Oracle conducted a global study in which 74% of senior executives stated a good experience will make customers become advocates for your business. 

Not only will they come back, but they will talk about you with their friends, family, coworkers. They will recommend you, defend you, and bring you new business. They will become your marketing tool.

The importance of CX can be summed up in a simple idea: without customers, you don’t have a business. And an American Express research found that 86% of customers are willing to pay more for a better experience. This is why your main focus should be on investing in that experience, so you retain the ones you have, while also attracting new ones. 

Why should your business focus on CX?

In an ever more scattered and competitive market, Customer Experience is set to be the defining factor that makes someone opt for your brand, and not another. A third of customers will quit buying from a business after their first bad experience. On the other hand, half of them are likely to splurge on an impulse purchase if they receive a personalized treatment from an employee, or even an online interface.

And if a customer rates your company 10/10 on a satisfaction level, he or she will probably spend more than twice as much on your brand. Their  loyalty may last for over five years. When you are happy with a product or a service, you don’t quit them.

Talking in money figures, according to a study by the Temkin Group, businesses that make US$1 billion a year can increase that number by US$ 700 million in three years, simply by investing in CX. The reason is, by doing that, they attain higher customer satisfaction rates, reduced customer churn and, consequently, increased revenues.

If you want to make that kind of money, that means you cannot ignore your customer needs, their emails, feedback, queries, and expectations. You have to listen, understand, and act based on what they tell you.

That is why a Bloomberg Businessweek survey revealed that great customer experience is a top strategic objective right now for any kind of company. It is the most effective way to beat your competitors, and get your customer to not only come back and spend more, but to become your marketing tool, through word-of-mouth, positive online reviews, and recommendations to their friends and acquaintances. 

Is customer experience the same thing as customer service?

Absolutely not! Customer service is when a potential client interacts with one of your employees, in a store, online, or on the phone, for example. And that is just one part of the customer experience.

If you go to a restaurant, and your order is served quickly, and tastes delicious, that is good customer service. But if you become a regular at that particular restaurant, the chef knows that you are allergic to onions, and does not use them in your food without you even having to ask, that is great customer service.

Because that is the heart, the central element, of CX: seeing and treating your customer as a human, an individual, and not a simple source of money. Customer experience is all about providing a human and authentic connection, one that does not feel run-of-the-mill, nor a script from a production line. It feels unique and personal.

Technology today, such as a CRM software, has made it possible for that individual experience to be executed in many different ways. Predicting future purchases and needs based on the customer’s history, or delivering targeted email marketing campaigns are good examples. However, it is still about seeing each one of them as an individual, listening to them, and anticipating their expectations and needs.

That does not mean customer service is not important. On the contrary. Providing assistance, answering every email, complaint, or question – and quickly – is more imperative than ever. But that is only one part of your customer experience, that has to start positively from the homepage of your website and last long after a purchase is made. 

What makes for a good customer experience?

Exactly because good CX must feel personal and unique, there are no automatic formulas or guaranteed recipes. The one key element that is at the beginning of every good customer experience is: listen.

Know how to listen

Listening to what your customers are saying to your business, and about your business, must be your top priority. Every feedback, email, technical support call, or online review must not only be dealt with quickly, but also used as raw material to create a strategy in reducing friction and providing better and more personalized service for your customers.

Have a good system

In order to do that, a system that puts all that feedback and information together, and analyzes it, is essential. The logic is simple: create channels that make it possible for your customer to tell you what he/she wants, likes, or does not like, acknowledge and understand their demands; then act on them.

If you are not doing that, the alternative result is quite clear. Your complaint and purchase lines are clogged, and your customer is frustrated with long waiting times – which is the number one cause of bad customer experience. 

The dialogue does not flow organically because your employee does not understand what your customer needs – which may make your employee’s frustration come off as rude or angry. Consequently, your client support is left with many unresolved issues and complaints. And your customer is dissatisfied with automated responses, and the lack of a personal, human, component. Those are all the roots of bad, or terrible, CX.

Mock up your typical consumer

Know, though, that it’s not easy. Most companies still don’t provide good or excellent customer service. In order to change that, your CX policy must come from the top of the chain, expressed in clear and public guidelines, available and known by everyone in your business.

For example, create personas, so your employees know whom they will be dealing with. Provide training for those same workers. And listen to their feedback, too. They are the ones on the frontline, so they are in an ideal position to see and feel what your company might be doing right or wrong – and how to improve it.

Always ask questions

Finally, never hesitate to ask questions. Use your chat platforms to better know your customers and their current experience with your brand. Follow those conversations up with emails. If necessary, outbound calls are not off the table. 

And remember: it’s all about empathy. Emotions play a huge part in customer experience. It is precisely the emotions that will determine if your customer wants to remain in business with you or not. 

But how do I measure if all of this is working?

Measuring and analyzing is one of the most challenging parts of customer experience. That is why a number of different metrics and tools were created to assess the quality level of CX in a particular company.

With them, it is possible to evaluate the effectiveness of specific strategies, as well as how they improve or not the customer’s perception of, and relationship with, your brand. The four CX measuring tools that are most used in the market today are listed in the following topics.  

Customer Effort Score (CES)

It measures how easy, or difficult, a consumer’s experience with one of your products or services was. Here’s how it works: a customer made a purchase on your website, for example, and you wish to know how easy it was for him or her to navigate the e-commerce platform. 

So you send a CES survey after they are finished, asking questions like “How easy was it to complete your online purchase”, or “to navigate our website”, with a rating scale from ‘1: very difficult’ to ‘7: very easy’. Pretty straightforward.

Net Promoter Score (NPS)

We all have answered a Net Promoter Score survey before. It measures a customer’s loyalty score, by asking a variation of the “On a scale from 0 to 10, how likely are you to recommend this product/company to a friend or colleague?” question.

In addition to being very simple and straightforward, that numerical score is a quite good assessment of customer experience. That is why the metric, created by Rob Markey and Fred Reichheld at Bain and Company, is favored by many boards and executive committees, being one of the most used by businesses in the world today.

Customer Satisfaction Score (CSAT)

While Net Promoter Score evaluates the satisfaction with the whole brand, CSAT surveys the customer’s experience with a specific product or service. The metric system, though, is pretty much the same, usually providing a scale from 1 to 5 or 7 – where 1 is very unsatisfied, and 5/7 is very satisfied. A yes or no answer may also be used, however.

Due to its specificity, and for how it makes possible to analyze each different point in the customer experience chain separately, most CX leaders in the world choose CSAT as their top metric.

Time to resolution (TTR)

One of the main sources of customer frustration, and bad experience, is waiting a long time to get a response. For that reason, TTR is a very important metric. It measures, in average, how long it takes for a customer’s issue or ticket to be solved by a company’s brand after it’s been open. 

The result may be provided in days or business hours, being the product of the whole sum of time spent in resolution divided by how many tickets and issues were solved. The logic here is pretty obvious: shorten your TTR as much as possible, if you want to increase the likability of having return business from a customer. 

CX trends

Good Customer Experience results all over the world have come from companies who have been following a certain set of practices. The first one is that they are customer-centric, instead of profit-centric. 

That means their top priority is providing an outstanding experience, focusing more on retaining and satisfying their current customers than on attracting new ones at any cost. Second is that good CX usually comes from old school methods. Yes, again: human interaction. 

Companies that privilege one-on-one personal conversations over chatbots, market research (such as customer calls) over predictive analytics and social media, as well as investing in talent on board, often present the best customer experience results. It is not about being state of the art, or overtly technological, but about the willingness to provide good, satisfying service.

Number 3 is something we have already said, but can never overstate: these companies are listening. The base for their CX strategies is the feedback from their customers. Not only they collect it, but they have put systems in place to properly analyze it, and turn the conclusions into action.

Next, they acknowledged the importance of their employees in implementing good customer experience. Not only did they provide specific and individual training, based on different departments’ and workers’ needs, but they also got all their workforce involved in their CX strategy effort.

Finally, no matter how well they are doing, Customer Experience leaders in the globe keep increasing their investment on CX initiatives.

So, how do I Improve my CX strategy?

A good CX strategy consists of guidelines and actions that start from the very top and involve the whole company. It must be assimilated by every employee because to a greater or lesser extent, they will all eventually play a role in the customer’s experience of your brand.

These guidelines and actions must come from a very simple customer-centric principle: make your employees understand they should treat a customer the same way they would like to be treated by any business. 

In order to do that, make your customer feedback – that same one you already collected and properly analyzed – available for everyone in your team. Let them see and know how they can improve those experiences you have surveyed.

And that is ever more effective the sooner it starts. Your workers should be informed of your customer policy as soon as they are hired. And through training and support, they must be updated and refreshed on those practices as often as possible.

There are two powerful tools that you can incorporate to your strategy and will make your brand step up its game regarding customer experience. We are talking about live blogs and live chats. 

Live chats

Most companies use live chats as a customer service channel. But did you know it is also possible to use this tool to generate an experience for our consumer? 

Some platforms, such as Arena, allow you to create live group chats. This means your audience will be able to comment on your event, exchange impressions and also very valuable information. 

Depending on the profile of your audience, you can promote this space as a powerful networking opportunity for them to connect with people who have similar interests and valuable contributions for them both personally and professionally. 

On the other hand, you, as a brand, will receive immediate feedback from your customers. This will allow you to know exactly what they like and dislike, which gives you the opportunity to redefine your course of action immediately. As a consequence, you will offer an even better experience to your audience, making them loyal to your brand and the content you produce.

This is customer experience to its core, generating true value for your public and allowing your brand to be a vector for meaningful relationships. 

Live blogging

Live blogging is a new approach to content marketing. As the name suggests, these are platforms that allow you to create content as a particular event or set of events unfold. It gives your audience (or public, as you might want to call) a chance to have access to things they otherwise wouldn’t. 

There are basically two ways in which you can use live blogging. The first one is to provide a full coverage of an event. This means that people who haven’t been able to attend feel like they are actually participating. Big tech events make full use of this technology for this kind of use. 

The second way in which you can benefit from live blogging is to broaden your user’s experience. Let’s say, for example, your company is promoting a big event with celebrities and big names of the area. 

In this situation, you can use a live blogging strategy to grant access to the backstage or to have specialists commenting on the theme of the event. You can also directly interact with your audience by publishing trivias and reposting what they have been saying about the event online. 

Live blogging is a fine way to deliver a greater customer experience to your public. By adopting this technology, you are giving them the opportunity to have access to exclusive content, personalised interaction and relevant content. 

Lastly, because it all comes down to this, and you have to remind yourself of that every day, all the time: in order to provide a great customer experience, listen to your customer and their feedback. 

Create channels so they can speak to you. Listen to what they want, need, like, and don’t like. Use that in your favor. Engage in the conversation, ask questions, try to understand them better.

In short: see them as human, as an individual, as your business partner. Speak their language, with them, not to them. And be quick. Don’t make them wait. Nobody likes to wait.

If you want to start testing some of the tools that will allow your brand to offer an even better customer experience, here’s what you can do: create an account at Arena and implement our freemium version of the live blog and live chat!   

What Omnichannel is and Why it Leads Customer Experience

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Omnichannel puts the customer at its ultimate core. This integrated and all-places strategy personalizes touchpoints in the customer journey to offer the most effective shopping experience anytime and anywhere.

It is fair to say omnichannel is the perfect response to a new customer-centric culture. Here’s everything you should know about it.

Taking care of customers according to their expectations is the greatest of brands’ responsibilities. This concern has made marketing, technology, and sales teams work together for years to increase customer satisfaction in different channels.

From mobile apps to desktop blogs, from e-commerce to social media and physical stores, customers expect the same service excellence in any place, at any time.

To reach that excellency level, companies these days must assemble and harmonize various components, such as data, multimedia marketing, and multiple sale channels, to get to their audiences at the right time and place, and intently offer the best of the best experience.

That’s when omnichannel walks in.

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What is omnichannel?

Omnichannel is a marketing and sales strategy that combines and crosses different channels to provide an outstanding and personalized shopping experience. By blending several elements into an integrated whole, omnichannel removes the boundaries between digital and physical spaces, optimizing brand messages, general communication, and, most importantly, customer experience.

Already a reality in some great retailers, omnichannel brings together e-commerce, shopping apps, blogs, social media, marketplaces, ads, and physical stores to improve the consumer lifecycle and customize its touchpoints, whether they’re digital or offline.

In order to be omnichannel, brands need to mix products, marketing, sales, customer support, supply chain, and more, to make their deepest reasoning clear: Put the customer in its ultimate core and let channels combine (and recombine) to deliver consistent and efficient shopping and communication initiatives.

Some omnichannel examples are:

  • Being able to buy a product that isn’t available in-store, using an app
  • Purchasing on e-commerce and collecting at the store
  • While collecting, being swiftly introduced to new launches that really interest you
  • Abandoning the cart and getting an email with the offer of a new, exclusive customer loyalty program that follows up to the abandoned product
  • Getting a shipping notification via e-mail and SMS

Omnichannel vs Multichannel

We can say every omnichannel retailer contains multiple channels. That makes omnichannel essentially multichannel, but the contrary isn’t true. Therefore, these terms can’t be used interchangeably.

The main difference between these “channel” concepts is that omnichannel integrates its operations while multichannel components act separately.

In a multichannel strategy, there isn’t mutual communication. In fact, it is common for multichannel retailers to face lack of information exchanges and a sense of competition between their channels.

When it comes to branding, multichannel sends out the same message in all channels and to all consumers, regardless of the lifecycle stage they’re at.

This combined with the fact multichannel doesn’t allow personalized experiences contributes to the idea that multichannel focuses on products, not on user experience.

Meanwhile, omnichannel not only integrates channels but collects and transforms customer data into personalized interactions with their consumers base. It means that, unlike lack of communication, an omnichannel brand message quickly adapts through the customer journey and remains relevant.

It doesn’t matter if the customer is online or not: The same unique message will be sent. Most businesses invest in multichannel today, although we should mention that omnichannel consumers spend between 15% to 30% more than multichannel consumers.

It is also important to distinguish omnichannel from cross channel. Cross channel strategies also integrate channels to offer more comfortable and agile shopping experiences. However, omnichannel stands out for being the only method to assess consumers’ behaviors, habits, and preferences to create personalized touchpoints.

Why should brands be omnichannel?

You probably know how exigent the modern consumer is. Technology has put a personal device and free access to information in customers’ hands, and people have grown fond of browsing and comparing. Technological and ever-changing lifestyle also makes customers enjoy shopping experiences that are flexible, trustworthy, and responsive to their needs. Buying when and where they want is a basic requirement for customer experience and care.

Another detail you should pay attention to is that people have enough time and information to consider which is the best product or service. And, thanks to content marketing, there is a huge number of tools that tailor customer journey to this new demanding and multi-connected profile. Brands work hard to make the most out of marketing in social networks, blogs, messaging applications, and more.

Still, content isn’t all it takes to engage people: Companies need to focus on customer behavior.

And, if you’re curious about it, you should definitely check these Google; and Salesforce; insights:

  • 68% of shoppers purchase movies, books, and video games both in-store and online
  • 66% of shoppers prefer online shopping to find items, compared to 27% who prefer offline
  • 55% of buyers say that retail experiences are disconnected from channel to channel.
  • 59% of shoppers prefer to shop online to get better prices
  • 83% of U.S. shoppers that visited stores had used online search before going into the store

That being said, brands should be omnichannel because customers are omnichannel. They don’t split a brand’s perception into offline and online. It means that, if their experience is damaged in any channel, frustration will lead buyers to switch to another brand. Recall that 58% of consumers will turn to competitors if they face a single bad customer experience. 

However, omnichannel benefits are not exclusive to shoppers. Companies that integrate sales, logistics, technology, and marketing channels also benefit, as they make consumers happy and likely to buy more – who doesn’t want more revenue, right? 

In addition, satisfied clients talk about their experiences with friends and family and help brands increase their customer base.

Omnichannel strategies also cut costs by rethinking opportunities based on consumer habits. Another advantage is that unifying communication promotes a more consistent brand image and encourages synergy between operations. Often, it is cheaper to adopt omnichannel and optimize strategies than to open more sales channels.

Finally, we should mention that being all-places – as latin Omni suggests – makes your brand capable of solving multiple use cases, whether online or not.

How does omnichannel work in e-commerce?

Omnichannel has a huge impact on e-commerce. Known for its convenience, e-commerces allow customers to buy anywhere, at any time, and provide relevant information about products and services that interest them.

The omnichannel mindset turns e-commerces operations more efficient. Its approach aims to provide online shoppers with seamless and continuous buying experiences.

Digital components that absorb customer data through e-commerce purchases can be easily accessed to create a well-built consumer understanding. The goal here is to identify what methods will bring better results and which channels are more effective to engage and delight the customer.

Another possibility is that e-commerce can lead to many other shopping opportunities. Think about the number of shoppers that buy online and decide to collect their products in-store.

How great would it be to offer specific products once the customer arrives? Or, to look at it from another perspective, think about what will happen to e-commerces that won’t let shoppers choose how and when to get their hands on their purchases. Will they fail to deliver convenient experiences? They surely will.

When correctly implanted, omnichannel e-commerces strategies will quickly identify customer touchpoints that will lead to specific solutions – and, as a consequence, to more engagement and brand loyalty.

The effects of omnichannel in customer experience and culture

Omnichannel is all about customer experience. Its core is to deeply understand buyers’ needs and embrace them, all while respecting their time and delivering meaningful messages.

Whether online or offline, omnichannel interactions should cause a sense of identification and present a brand that gives buyers the chance to access their preferences.

The real impact here is that, by understanding people’s needs, omnichannel is extremely powerful to generate follow-up interactions and engaging buying stages.

All data available must be used to create a context for future touchpoints in multiple shopping environments. And the secret to the omnichannel done right is that this context must be continued, wherever people are.

Customer experience must be continued, otherwise, brands fail to engage and retain. If your consumers don’t identify with the message you’re sending through your channels, then they’ll look for other messages they can connect with.

That’s why you have to step back and focus on the fact that, for your channels to be truly omnipresent, you firstly need to perceive the habits and preferences of your target audience.

If you think omnichannel only personalizes messages and experiences, you better think again. Being able to collect and interpret universal customer data is a fascinating way to go a little further and customize offers and even products.

Let’s move on to some examples of how to do that!

Be inspired: real omnichannel experiences

Sephora: My Beauty Bag

Born with digital DNA, the giant beauty Sephora created a special feature to connect clients to their favorite products. Named “My Beauty Bag“, the feature – which is also an app – is part of the Beauty Insider loyalty program, and allows customers to access products and past purchases whenever and wherever they want. 

While using My Beauty Bag, clients can, whether in-store or not, search for the right shade of lipstick, rebuy old purchases, and recommend products to friends. Sephora’s stores are equipped with tablets that make it possible for consumers to log-in immediately and add new items to their bag or “loves” – previously known as Sephora’s shopping list.

My Beauty Bag enables shoppers to collect favorite products, organize them in one place, create wish lists, keep track of both online and in-store purchases, and track rewards. 

Burberry: Series B

Based on customer data, Burberry created a new series of limited edition products that remain available for only 24 hours on the 17th of every month. The timing here creates hype and a sense of urgency for customers to reach out and buy the exclusive and recently launched products. Purchases can be made on Instagram, WeChat, LINE, and even in the Korean Kakao platforms.

This type of strategy was essential to increase consumer engagement and create anticipation, and it paved the way for the development of new activities across multiple channels that focus on customer experience and interactions.

Amazon: Amazon Prime and Amazon Go

Even if a huge number of companies worldwide won’t have as many resources as Amazon has, there are some key details to pay attention to in their omnichannel strategy that can inspire other businesses, especially when it comes to data unification.

With the mission to be the world’s most customer-centric company, Amazon has been investing in omnichannel for years now. 

When Amazon Prime membership arrived, it called public attention by offering free shipping. It saved time and was convenient. As time went by, other benefits were provided, such as unlimited video and music streaming, discounts, and even a wardrobe, that allows customers to try on items online before purchasing them. 

Omnipresent, Amazon decided to expand to physical dimensions and launched Amazon Go, a convenience store where customers don’t need to wait in line.

Through the Amazon Go app and artificial intelligence features, clients register everything they’re putting into the cart and leave the store as soon as they want. There’s no need to pay in the cashier. Their receipts appear in the app and money is charged from the Amazon account.

This new type of purchase is called “Just Walk Out” and embeds different AI technologies and data to provide the best shopping experience. Omnichannel at its best!

As you might have noticed, omnichannel is intimately related to customer experience and retention – and brands that ignore its potential are most likely to fail in maintaining competitive advantage. 

Want to learn more about engagement and make your customers brand loyal? Access our Customer Experience Guide!

What is Product-Led Growth: the PLG Complete Guide

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Use product-led growth to reduce friction between the customer and the path to acquisition. Learn how to improve sales, cut off expenses and generate retention.

Your sales team has just got bigger, and it’s not because of new staff members. It’s the Product-led growth, or PLG, making your product become the seller itself!

Since customer experience is now mostly responsible for acquisition, buyers tend to prefer discovering value by themselves rather than having someone create scenarios for them.

Find out now how product-led growth and its fundamentals can be a powerful game changer for you.

What is Product-Led Growth?

Before diving deeper in this guide, you must have in mind that product-led growth creates a straight line connecting your customer and the acquisition moment, eliminating possible gutters and bumps throughout the way. PLG establishes a clear and smooth path towards value generation.

That said, this (not so brand) new business methodology allows customers to build their own product worth through customer experience (CX) instead of sales-leading them from Point A to Point B, like other business strategies.

By creating a truly meaningful experience, customers can now produce their own validation when it comes to the product. As a result, upgrades become a natural, no-brainer step of the way.

You build the experience focused on solving your end user’s pain. Now, your product has become the primary driver of acquisition.

The Importance of Product-Led Growth

Product-led growth is not just a business approach, a trend, or a marketing wave. PLG is an alignment between team strategies. It promotes a stronger integration, leading to a wiser, more polished and solid placement.

I bet you have seen this many times: sales and marketing operating so individually and distant from the product, they seem to be telling totally different stories.

Product-led growth tells: “Hey, marketing, your customer has just used Service X. How about triggering an upsell according to the interest flagged?”. Then, marketing can say: “Sales, here’s a hot opportunity for you to offer a personalized follow-up to this user”.

You create a cohesive storyline for everybody!

And you do that by offering real-life experience instead of just putting out their white papers telling how you can solve their pain. You are all focused on how your product can genarate demand.

Bill Macaitis, former CMO of Slack, says: “I tell my team members that their gold standard is not whether customers bought a product, but did they recommend us? It’s a higher bar and a different standard. We also don’t see marketing’s role as getting customers in the door and then wiping our hands and going on to the next one. Marketing’s role is about recommendation”.

Through PLG, every single collaborator has its focus on product, enduring and enhancing customer value. The demands are real, folks! They need to try before they buy.

Product-Led Growth Background

These definitions presented so far might seem pretty disruptive and innovative, but it’s not, actually. In fact, PLG is a result of the constant development of strong product-based companies.

The name Product-Led Growth gained visibility around 2017 when OpenView Partners brought up some discussions that created some of the guidelines fostered until these days. But it actually started at the beginning of the last decade.

Here goes a brief contextualization of Growth eras we’ll explore appropriately ahead.

Product-led growth puts all divisions of a company running on the same track. But before it happened, Sales-led growth (SLG) was the one in charge for most of the strategies.

That means field sales, high-touches and a dramatic amount of money spent on customer acquisition were considered top priorities.

Then, as the way customer experience improved and Marketing-led growth (MLG) took the spot for a while. MLG brought the idea of inbound marketing along with the purpose of reducing customer cost acquisition.

But since 2017, Product-led growth has constantly proven that the efforts must be pointed, like a prism effect, towards one thing: the product itself.

Take Dropbox as an example. A decade ago, they were using the product to generate leads and drive business –– even if there was no such thing as “product-led growth” yet.

Dropbox

It has been said earlier that product-led growth is not as brand new as it seems. There were a few pioneers in PLG, such as Slack, Mailchimp, Typeform and, the one to talk about, Dropbox.

Dropbox is one of the best examples to understand PLG on a regular basis and to actually see the benefits. In less than 10 years, they have reached $1bi in revenue!

They started as this simple, initially free, but with pretty interesting features storage platform. Dropbox rapidly became one of the best tools for file sharing, going viral worldwide.

To take advantage of the massive visibility, they gave the user a possibility to earn more space by sharing a referral link. As a result, they got thousands of new users and enhanced the experience of those existing ones.

The community had so much value there, Dropbox became an essential part of users’ lives. The upgrade to a paid version was just a matter of time. It was organic. No friction is needed.

Netflix

Let’s take Netflix as an example now: an excellent model of a company conscious of digital changes, aware it was not a matter of “if” they had to innovate, but “when”.

They have been in the business for quite a while now, and we can have some great tips on their product-led growth.

When you first met their streaming platform and signed up for a free month trial, no sales rep had you on the phone or flooded your inboxes with probably annoying messages trying to convince you why you should have the paid version.

Instead, Netflix opened up its entire catalog for you. No restrictions, no limits, just the complete experience there for you to taste!

During the free month trial, as you binge-watch their shows, they kept “magically” suggesting more content related to your preferences. And that was definitely not a random thing.

Netflix’s PLD reads all your interests and builds an entire scenario exclusively for you. Your experience was enhanced by data they collected from your behavior, like DNA.

And that’s exactly what product-led growth also can do for your company. It turns your product into a powerful source of primary acquisition.

Why should you use a Product-Led Growth Strategy?

In a progressively expanding market, product-led growth shows you don’t need to overspend in advertising costs, new team members or any other decision that might become a trap due to desperation to achieve better results.

It also reveals where you actually need to invest money, time and effort. Through PLG you’ll see it’s needed to redefine design paradigms and explore new demands when it comes to product thinking.

From now on, products must be self-sufficient! Customers want to self-educate themselves more than ever. They want to build their own way to experience products. That leads to a hands-on moment, and that is when “try before you buy” comes into the scene.

The Evolution of Growth Acquisition Strategy (GAS)

An action plan to acquire, retain and grow customers are the fundamentals of a Growth Acquisition Strategy. Those pillars enable a better definition of product distribution and the most appropriate channel to do it.

Definitely not a strategy to be set and forget, PLG requires a collective alignment to break team walls and synchronize the moves.

We had briefly mentioned before the eras, but now it’s time to dig in. Keep up!

1st Era: Sales-led Growth

The main difference between Sales-led and Product-led growth is how the first one had its focus on cold-emailing and calling, outreach and sales lead scoring based on aspects like the industry, titles, teams’ sizes, etc. Back then, it had nothing to do with the product itself nor the experience.

Sales-led qualification didn’t try to actually prove any value. Instead, they were 100% committed to convincing the customer about their product by simply telling. Buyers didn’t have tangible proof of the benefits.

It’s also important to mention the Customer Acquisition Cost (CAC) during sales-led growth times since the entire onboarding had to be procedure by the seller itself, customer by customer.

That approach could be long, tiring and really expensive. The purchase had to cover all those expenses out, or else all the work and effort wouldn’t pay off.

2nd Era: Marketing-led Growth

With the advance of the internet, consumers were able to get more information for themselves during the buyer’s journey. That empowered them to be much more in control of the process.

The primary driver of acquisition here was to obtain leads and nourish them. That’s what we call Marketing-led growth (MLG).

Marketing-led taught consumers about self-education, generating qualified demands. As a result, you had a Marketing Qualified Lead (MQL). Inbound marketing was the pivot to build MQL, have scaled demand and give the chop to high customer acquisition costs.

It also had a medium/low-touch approach, opening room for more polished and personalized conversion methods. Sales now became an inside operation, having their role placed mostly at the end of the funnel.

Looks like a great change compared to the previous growth model, right? But MLG had some death traps that frequently led to a high rate of unclosed deals. According to ProductLed, these were the top 3 reasons conversions became a serious issue:

  1. It encourages marketers to gate content to hit their MQL goals.
  2. It focuses on content consumption as a leading indicator of intent.
  3. The entire process rewards creating friction in the buying process.

The result was a major disconnection between marketing and sales. This business model segregated profit centers and costs centers, creating a weak organizational ground.

Product-Led Growth Taking Over Tech Companies

Understanding and embracing product-led behavior is key. The End User Era is real, and so are new demands. But a turning point here is to take a step aside and analyze how this can be applicable to you and your reality.

It’s not about becoming Dropbox, HubSpot or anything else. Of course, it’s totally fair to emulate their steps and get inspirational, but your successful story can be authentic to your story.

Small, medium and big technology companies, across all product categories, realized that product-led growth is much more than a disruptive strategy. The way people use and buy your software has changed, and so has your go-to-market playbook.

B2C Product-Led Growth Companies

Business-to-Customer (B2C) companies on their way to a strategy rely on the product as the primary driver for acquisition need to remember one thing: their end customer is a real person, and the need to build a personalized experience based on that rule is crucial.

Most of those end users don’t want to go through a lengthy sales process to find out if there’s a fit or not to the product. They want to try it now, selecting their own criteria to make the pavement towards a unique experience and satisfaction.

A report from Forester found that nearly 75% of B2B buyers rather buy through an app or website than having a salesperson guidance. That’s because 80% of people tend to do business with companies that offer personalization.

And that is why the following names became heavy players when it comes to B2C companies on product-led growth, according to ProductLed.

Pinterest

It’s curated feed, personalized user onboarding, and inherent virality make Pinterest a poster child for product-led growth—and in 2019, IPO’d with a $12.7 billion valuation.

Typeform

Launched in 2013 as a free beta, its conversational approach to data collection and beautiful, easy-to-use form builder helped Typeform go viral. They closed a $35 million Series B in 2017.

Warby Parker

The digital-first eyewear retailer raised a $75 million Series E in 2019, thanks in part to its omnichannel consumer experience and free Home Try-On program (aka free trial).

B2B Product-Led Growth Companies

Your Business-To-Business (B2B) message needs to be communicated not just to executive users but to end users as well. Rethink the design of your website. Ask yourself: “Am I making the sign-up stage the easiest process here?”

Make your product become your marketing channel, enabling chances to virality through referral paths and user reviews. ProductLed also highlighted how these groundbreaking B2B companies helped their consumer realize fast the value of their products

Airtable

Reported $20 million in revenue in 2018 and created Airtable Universe to scale the inspiration of use cases, a responsibility usually held by customer success.

Slack

43% of the Fortune 100 pay for Slack and are loud advocates because of their company-wide devotion to its great experience.

Figma

Closed a $40 million Series C in 2019 thanks to its product-led approach to solving designer pain points like project organization, file management, and real-time collaboration.

Product-Led Growth as a Market Entry Strategy

It’s important to acknowledge the existence of buyers who rely on sales support. They need more when it comes to making their decision. It might be a complex process, but there lies a precious opportunity to collect data, enhance lead qualification and improve the chances of conversion.

Follow your prospect’s steps: understand what they are using, where, what part they’re getting caught up. With this quality of information, your support can touch precisely their pain point and offer the greatest solution.

That is a masterful way to create a personalized customer experience! 

Product-Led Growth Key Metrics and Principles

We mentioned earlier about team alignment. Check it out how it really works on a daily basis. It is very important to create homogenous communication. The bond of this integration is common language and reporting system.

What are PLG Metrics?

For your surprise, you might have been tracking some of the product-led growth metrics. Many used in SaaS metrics are very helpful to PLG. Although, they have different levels of relevance in a scenario ruled by product-led growth approaches.

How to Measure Product-Led Growth

Before we start listing just a few of them, it’s important to emphasize that each metric below can be leveraged differently by your teams. Carefully analyze how they fit for you and use them as a customizable framework.

Time to Value (TTV)

This one measures how long it takes your customer to realize your product’s value. The goal here is to reduce this time and make users feel that “aha!” moment as soon as possible.

TTV is also used to understand how much time users spend from acquisition to activation.

To do this, you must focus on the onboarding experience around the key actions correlated to activation: invites, referrals, data sharing, integration, etc.

Expansion revenue

Here, you’ll measure revenue from existing customers due to upsells, cross-sells, add-ons, etc.

The market commonly sees expansion revenue as a new acquisition strategy. Although, the best players in business recommend that at least 30% of your revenue should come from there.

Product-Qualified Leads (PQLs)

The leads right here are those who’ve already experienced your product, had the “aha!” moment and already know its value from a free trial of a freemium account.

To define this metric you need to create some events to track if they’re ready to move on to the next stage. These events could be related to usability, sections visited, or previously defined behaviors that flag an opportunity.

Customer Lifetime Value (CLV)

Now that you know how long it takes for your consumer to realize your product’s value, the events accomplished to prove they’re ready to acquire, now is time to understand how much revenue your business receives from a single customer throughout this relationship.

CLV is one of the most accurate, high-level indicators to show business health. To calculate it, you must divide the total expansion revenue by the number of customers.

The Benefits of Product-Led Growth

Through a low-touch/touch-free approach, frictionless customer acquisition, team alignment, synchronicity, and so many others, there’s only one thing expected from all this heavy work: money!

The power of product-led growth leads to financial productivity – a higher revenue per employee. And that is possible because of the product driving force during acquisition, engagement, retention and expansion.

As the product itself does much of the marketing, sales and customer experience work in a PLG strategy, a massive cut in customer acquisition cost and shorter sales cycles.

In addition, a higher revenue diversity comes up as a strong suit for PLG, minimizing the consequences of losing accounts and enhancing growth.

Wes Bush, a renowned PLG pioneer, says that “product-led businesses tend to scale faster than their competitors in two powerful ways”:

  1. Wider top-of-funnel: A free trial or freemium model opens up your funnel to people earlier in the customer journey. This is powerful because, instead of prospects filling out your competitor’s demo requests, they’re evaluating your product;
  1. Rapid global scale: While your competitors are busy hiring new sales reps for each region under the sun, you can focus on improving your onboarding process to service more customers around the world in a fraction of the time.

Product-led growth has proven over the years its power to be financially productive and operates to leverage data produced by-products to improve sales. Us from Arena wants to help you get there on product-led growth. And it’s going to be right now!

Talk to an Arena consultant and understand how our data solutions can assist your marketing strategy.