Understand your own data and only then determine what data you need from outside sources.
“Spray and pray” is an ineffective but all too common marketing strategy. It’s particularly enticing when it comes to data, since the availability of data is so vast and overwhelming that it’s hard to know where to begin.
Brands are increasingly taking a hybrid approach to their programmatic advertising strategy; they hire in-house talent to manage first-party data, but work with partners to help with planning, targeting and expanding their reach.
But as you develop data partnerships and introduce third-party data to your strategy, how do you evaluate the quality and relevance of that data? How do you develop strategic partnerships to enhance your data accuracy, speed and effectiveness?
1. Identify Sales Funnel Goals
First, think about the goals of each campaign, and where each campaign sits in your funnel. Before you begin looking at third-party data sets, defining your objectives will help you determine what to focus on.
If you are focused on an upper-funnel brand awareness campaign, demographic, attitudinal and lifestyle data segments can help you reach a new audience. If you’re focused on more bottom-funnel numbers—such as conversions or subscriptions—you may be more interested in intent signals like product clicks, subscriptions or past transactional data.
2. Know Your Core Audience
Once you’ve established your objectives, focus on your foundational audience. The better you understand your own first-party data (information you’ve collected directly from your customers or visitors, such as in-store purchases, loyalty members, website clicks or buys, app downloads and CRM data), the more you can do with third-party data. By identifying carefully segmented “seed sets” based on current customers and information, you will be more capable of modeling new audiences and campaigns around specific types of customers and behavior.
Who are your core consumers? Who’s visiting your website and what is their behavior? What segmentation data do you have? Who are your most loyal customers? Who are your mobile power-users? Knowing your foundational first-party segments can give you a better idea of the kind of data sources that will add the most incremental value.
3. Choose a Partner, Wisely
From there, you’re ready to start working with a data partner. To determine the quality of your third-party data, think of the five W’s:
Who are you considering working with and what do they specialize in? While broader networks and DSPs (digital demand-side platforms where you can exchange data and ad inventory) may offer a wider breadth of data, in some cases it may be better to work with data providers who specialize in particular categories or industries rather than buying canned audience segments from jacks-of-all-trades vendors.
Where can this partnership lead you? In other words, what kind of scale can your data partners offer? Can they deliver significant volume?
When is the data created and served? Recency matters, especially if you’re looking to target shoppers who are in market. Will the data be streamed daily, or is it from last week or several months ago?
The why is imperative. How relevant is this data to your current marketing goals? (See section 1 on identifying your campaign goals)
The bonus “H”: How did your partners come upon the data they have? Has the data been collected and compiled from multiple sources, or a single first-party source? Data sets compiled from multiple sources may vary in quality, while single-source data tends to be more consistent.
4. Partner to Expand on Your Core Data
Note that I keep using the term “data partner,” rather than “data provider.” That’s because in the era of big data, using quality data is of the utmost importance and shouldn’t be entrusted to just anyone. Preferably you can build a long-term relationship with your data partner, and continue to find new ways to enhance your own customer profiles, model new audiences and improve performance over time.
A good data partner will bring unique and quality data to the table, in a vertical and with attributes that align with your goals. From there, you can build data sets or uncover new information about your audience you hadn’t discovered yourself, allowing you to expand your core user base.
5. Merge Internal Data Efforts
Your data partner only has so much control—without a unified internal effort to surface and support your data initiatives, valuable data sources may go untapped. Too often, various marketing departments become siloed, which creates an inefficient process and a slew of missed opportunities. For example, those in charge of email marketing or personalization might acquire valuable data on retention and segmentation—but other internal marketers on the acquisition side may be unaware.
When you treat data as a team sport, you’re able to better experiment, collaborate, and find new opportunities for combining and blending data in ways you never thought possible.