What is Predictive Marketing and Why is it Important?
- April 15, 2021
- By Ellis Edwards
If you’ve ever invested untold amounts of time, energy, and effort in a marketing campaign that ultimately fell flat, you’ll no doubt appreciate just how invaluable predictive marketing can be to your business.
An approach known as predictive analytics marketing can help you to make informed decisions about the most effective ways to achieve your marketing goals.
But why is it so important? How does it work? And what steps should you take to create a successful predictive marketing strategy of your own?
Below, we’ll answer all of these questions so you can start reaping the rewards for yourself.
What is predictive marketing?
Predictive marketing is a process by which you can use data you’ve already gathered to determine which marketing strategies are going to be most successful for you in the future.
For example, you might look at behavioral data such as website views, page views, and click-throughs to help you create new landing pages or to modify your homepage.
You might use purchasing histories to determine which products you advertise to which customers via online advertising, or analyze historical data to determine the kinds of images you use in your social media posts.
Why is predictive marketing so important?
Predictive advertising and marketing can be important for any number of reasons, all depending on the goals you’re trying to achieve.
Improve conversion rates and brand loyalty via your website
Leveraging data on how customers use your website lets you create much more personalized experiences, such as making real-time recommendations. This can not only help to create a short-term increase in your conversion rates but also help to improve long-term customer retention and brand loyalty.
Increase your ROI on email, social, and other marketing approaches
Predictive analytics can help you identify trends in the results of your previous email marketing campaigns, social media content, and approaches via other marketing channels. Those trends can give you a clear idea about what’s likely to work and what isn’t. As such, you’ll be able to avoid wasting time, energy, and resources on things that are less likely to produce the results you need.
Qualify and prioritize leads
Predictive analytics can help you to make the most of audience segmentation and determine which leads are most likely to convert. That way, you can focus more on those potential customers and avoid wasting advertising dollars on customers who won’t be as responsive.
Ultimately, what all of this comes down to is helping your business to do more of what works so you can minimize waste, maximize revenues, or simply take a more efficient approach to getting your business where it needs to be.
What makes a strong predictive marketing strategy?
So far, so good—but what do you actually need to do to make predictive marketing work for you?
Here a few key suggestions:
Focus on quality data
The more data you have, the more opportunities you have to make the most of predictive analytics. But keep in mind that quality matters just as much as—if not more than—quantity.
If your data sets are littered with inconsistencies, duplicates, or inaccuracies, they’re far less likely to be of use to you.
Define your goals
While it may be true that carefully collected quality data can throw up some surprising and useful insights that you may not have considered, you’re going to get the best return on your investment in predictive advertising if you know what you want to achieve in the first place.
Defining your goals will make it much easier to identify what trends and patterns you’re looking for and how to use them most effectively. For example, if you’re a publisher who wants to increase paid subscriptions, you may want to build lookalike models of users who look like your best customers and target campaigns to this audience for anyone who is not yet a subscriber.
Use the right tools
If you have enough data to draw meaningful predictions from, then you probably have too much data to manually sift through, at least not without wasting a huge amount of time that could be better utilized elsewhere.
This is where tools like Lytics customer data platform come into play, helping you harness the power of your data to create effective, cost-efficient solutions for achieving your business goals.
Predictive marketing: The takeaways
To sum up, there are three key points that you should take away from this:
- Predictive marketing can help you make better use of your current and historical data by applying it to make calculated predictions about which aspects of your marketing are most likely to produce the results you want.
- This approach can be invaluable for minimizing wasted time, resources, and ad spend.
- Quality data combined with an efficient customer data tool like Lytics can help you to make the most of predictive marketing in a way that’s effective, efficient, and affordable.