How to use customer data for marketing

When it comes to marketing, gathering information is one of the best ways to give yourself an edge in the market.

Nowadays, customer behaviour and activity on the internet is the source of the majority of those valuable customer insights. This activity, as well as a customer’s personal details, is called customer data. 

In this guide, we’ll give you all the information you need to use customer data for marketing, including:

• What is customer data?
• What kinds of customer data can be used?
• How to use customer data for marketing 
• Using customer data the right way

As the name suggests, customer data is information about customers. It’s used to analyse their behaviour, personal activity, and demographics. In marketing, that information can be used to gather useful insights, allowing you to create the best possible strategy. 

Broadly speaking, you can split customer data into two categories:

• Quantitative data — Anything that can be measured by numbers, like percentages, purchases, and website traffic.
  
• Qualitative data — Information that’s observed and recorded. It tends to be opinion-based, like customer reviews, surveys, and interviews. 

Qualitative and quantitative data can be further broken down into these specific categories:

• Identity data
• Engagement data
• Behavioural data
• Attitudinal data

Starting with the basics, identity data refers to simple information that helps identify customers, such as:

• Name
• Gender
• Age
• Phone number
• Home address
• Email address
• Job title
• Social media handles
• Account information

Data like this can be used to create basic customer profiles, allowing you to sort them into different demographics. 

Sometimes called interaction data, this shows you exactly how customers are engaging with your business through various channels. For example, you could see exactly how many customers are contacting you by phone, email, or social media. 

On top of that, you can see exactly what they do when they engage. For example, you could see how they’re interacting with your social media posts, whether it’s likes, comments, or shares. 

It’s easy to confuse behavioural with engagement data, but there’s an important difference. While engagement data records how customers interact with your business, behavioural data shows detailed information about their specific actions. 

For example, you could analyse purchase history, abandoned shopping carts, renewed subscriptions, or customer drop-off. Insights like these allow you to perform a more detailed analysis of your customers.

The previous kinds of data are based on numbers and stats; i.e. things that can be measured objectively. Attitudinal data, on the other hand, measures the way customers feel about your brand identity, products, and services.

Because it’s opinion based, the only way to gather attitudinal data is by asking customers to give you feedback. That’s why so many businesses ask their customers to complete online reviews and surveys. 

The biggest problem with attitudinal data is that it can be difficult to measure accurately. Everybody is different. They all have different expectations, standards, and methods of expressing themselves.

After you’ve gathered enough customer data, you can start to analyse it. The analysis will help you see what you’re doing wrong, allowing you to keep improving your marketing strategy.

Engagement data can tell you how customers are engaging with your business’ online platforms, which includes your company website and social media pages. 

Analysing customer engagement will tell you how well your marketing strategy is attracting customers or improving brand awareness. You can then adjust your strategy and see how it affects different kinds of engagement.

Conversion rates show how many people viewed your marketing material versus how many actually carried out the desired action. 

For example, you can see how many people bought something after visiting your store. Or you could check how many purchased a specific product after seeing promotional material.

By viewing the conversion rate figures, you can measure how convincing your marketing material is. 

You can use customer data to show you where most of your sales are coming from. This allows you to focus your marketing strategy on different areas. 

For example, you might see that your Instagram business page is getting more sales than your Facebook business page. Information like this might indicate that you’re doing something right on Instagram that you’re not doing on Facebook. It could also reveal if more of your target demographic are using Instagram than other platforms, giving you a clear target to focus your efforts. 

Using customer data can bring a huge range of benefits to your business. That said, it’s vital that you use it in a safe and legal way. This means following the General Data Protection Regulations (GDPR) closely.

First, appoint a Data Protection Officer to oversee how customer data is handled. Some businesses may not need a DPO: read here to learn more.

Next, consider how you are storing your data. It’s important that customer data is both kept up-to-date and stored securely. Look into data storage solutions that include encryption to ensure customer data isn’t at risk of being leaked.

Finally, make sure your data collection in future follows GDPR. This means clearly stating to customers that you are collecting their personal data and telling them why. A common example seen on a lot of websites are tick boxes. For example: ‘Please tick this box to receive marketing communications from us, including sales notifications and special offers.

Using and collecting customer data correctly is essential, as you can receive fines or jail time for breaching GDPR.

While customer data can be used for marketing campaigns, financial data can be used to make better financial decisions. 

Cash flow, for example, lets you measure the financial health and create profit/loss projections by tracking money moving through your business account. For the most accurate cash flow insights, try the Countingup business current account and app. 

Countingup is the business current account with built-in accounting software that lets you manage all your financial data in one place. With features like automatic expense categorisation, invoicing on the go, receipt capture tools, tax estimates, and cash flow insights, you can confidently keep on top of your business finances wherever you are. 

You can also share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward! 

Find out more here.