Customer data marketing: Strategies to drive personalization and engagement

Highlights

You’ll learn about customer data marketing strategies for personalization and customer engagement.

• Gamification: Collect data via interactive tools like animated quizzes and rewards
• Omnichannel experiences: Deliver seamless engagement across all platforms
• Dynamic A/B testing: Adjust campaigns based on user feedback
• Use AI: Analyze data in real-time for dynamic insights and product recommendations

Leverage customer data marketing for deeper connections and lasting loyalty!

Modern customers expect far more than a one-size-fits-all experience. A Forbes report states that 81% of consumers prefer tailored experiences. So, businesses have moved from generic experiences to personalized experiences, improving customer engagement and building loyalty.

But how do businesses come to the point of delivering these tailored and relevant experiences? Much of it lies in their use of data.

We explore the concept of customer data marketing, its benefits and how it is powered by tools like real-time CDPs to drive personalization and customer engagement.

What is customer data marketing? 

Customer data marketing is the process of using customer data to understand customer needs and behavior, with the goal of offering personalized marketing solutions and tailored experiences.

When a brand understands its customers' needs, desires and behaviors, it can tailor content and campaigns to be more meaningful and engaging. To do that, they need to collect customer data from multiple sources and use the data to inform strategy.

How it differs from basic marketing 

Traditional marketing relies on general audience targeting. This leads to broad campaigns that fail to resonate on a deeper level. However, with customer data marketing, a business taps into specific customer pains. Here are some examples.

• Using browsing history to recommend products instead of generic email blasts
• Offering customized rewards in a loyalty program instead of generic promotions

In essence, you remove the guesswork and connect with customers based on what matters to them on an individual level. But why does any of that matter?

Why customer data marketing matters

Customer data marketing enables you to create real, emotional connections with your audience. It is also about doing what customers expect, considering most want a tailored experience.

Aside from that, studies also show that businesses that prioritize data-driven personalization see higher ROI, improved retention rates and sustained customer loyalty.

Types of customer data to leverage 

For effective customer data marketing, you need to understand the four main types of customer data:

• Basic identity data: This includes information like names, phone numbers, email addresses, etc. It forms the foundation of personalized interactions. Brands can encourage their customers to share their identity data via opt-ins and sign-ups, but they must adhere to privacy regulations.
• Customer interaction data: This includes app activity, social media reposts and shares, website visits, etc. Use specialized tools like Mixpanel and Google Analytics to track how users interact with your website. This helps you identify products or services that interest them.
• Behavioral data: This includes customers’ actions when they interact with your brand, such as cart abandonment, purchase patterns and frequency, etc. These behaviors can inform your strategy. For instance, a customer who shops athletic gear often may appreciate tailored offers on fitness trends.
• Attitudinal data: This refers to data on customers' feelings. It addresses why customers behave a certain way. It includes opinions, specific feedback and satisfaction levels. You can gather this data via customer reviews, surveys, interviews, focus groups, etc. 

Data on customers' attitudes also informs strategic decision-making. For instance, multiple negative pieces of feedback on a product feature can hint to the business to update, adjust or pull such a feature.

Strategies to drive personalization and engagement 

Once you have the right marketing data, you can move from insights to action. Here are some strategies to deliver personalized campaigns that engage your audience and turn them into repeat customers.

Using AI and machine learning 

AI and machine learning (ML) process large datasets for actionable insights. With AI-powered tools, you can:

• Analyze customer behaviors in real-time 
• Deliver dynamic product recommendations 

Think about how Netflix recommends content based on your viewing history. This is a classic use of recommendation systems to track behavior and suggest content to viewers.

Gamification for data collection

Gamification is an excellent way to encourage interaction and collect data while enhancing engagement. Techniques may include preference quizzes and reward programs that offer incentives in exchange for customer feedback or other data. 

A classic example would be Duolingo. Consider how it uses leaderboards, streaks and badges to keep users engaged. It also collects user interaction data, enabling them to understand their preferred exercises, lessons they struggle with and how often they use the app. 

Delivering omnichannel experiences

The modern customer interacts with brands on multiple platforms, such as mobile apps, the web and even physical stores. An omnichannel approach unifies these platforms, allowing brands to deliver a seamless and consistent experience on all platforms customers use.

With customer data marketing, brands can track a customer’s browsing activity and use that to offer them discounts for the same products in-store. This ensures a seamless blend of the digital and physical shopping experience.

Using first-party and zero-party data 

First-party data is data collected directly from customers, while zero-party data is any data that a customer volunteers to share with a brand. These data are goldmines for personalization strategies, and you can collect them via surveys, quizzes or sign-up forms in exchange for exclusive perks.

Dynamic A/B testing 

Sometimes, all it takes is one minor adjustment to improve campaign success drastically. Dynamic A/B testing allows you to tweak variables and analyze which version resonates the most with your audience. You can test images, email content, call-to-actions, etc. Use an iterative approach to ensure you have the most accurate feedback to base your adjustments.

Balancing personalization and privacy 

Despite the clear benefits of data-driven personalization strategies, businesses must treat customer data with utmost care. Regulations like GDPR and CCPA provide clear frameworks for data collection, consent and usage. Businesses are to adhere to these guidelines and ensure transparency in data usage. Here are some best practices.

• Be clear and upfront about customer data usage 
• Empower users to control data sharing via opt-in mechanisms
• Implement secure systems to protect data and prevent breaches

By taking these measures, businesses can build and preserve trust while using data to deliver personalized experiences that customers demand.

Tools and platforms for effective data marketing 

Effective data marketing requires a brand to analyze, manage and apply customer data to its strategies. While these processes can be complex, using advanced marketing tools makes things easier. Here are some essential tools to consider:

• Customer data platforms (CDPs): Systems like a real-time CDP unify data across channels, creating detailed customer profiles that drive real-time personalization. 
• Marketing automation tools: These tools allow you to automate marketing tasks like email campaigns, dynamic ads and customer segmentation. It streamlines the marketing process, enabling you to save time and optimize your outreach. 
• Analytics software: These tools enable you to track and measure campaign outcomes. They provide reliable data that supports your marketing strategies. An example would be Google Analytics.

While the tools listed above may suit larger enterprises, small and medium-sized businesses also have other options, such as ActiveCampaign, Mailchimp, HubSpot, etc.

Case studies

Industry Dive

Industry Dive could not profile its customers based on the data it was collecting. Hence, they opted for Contentstack's real-time CDP to address the issue, harmonize its data and deliver personalized experiences. This increases its customer engagement by 40%.

"Our editors really see the value of Lytics. They’re using it every day to shape their editorial content." Robin Re said.

Keep reading to see how Industry Dive enhanced customer profiling via a real-time CDP.

Land O'Lakes

Land O’Lakes chose Contentstack’s real-time CDP to manage its data for better segmentation. This improved CTR by 29% and conversion rate by 38%.

Steve Rude said. "Impressions are the metric of a failed marketing campaign…If you’re not getting the conversions, it means you weren’t hitting the right audience. You may not reach a million people, but we’re going to reach the right people with the right message. And that’s where Lytics helps us."

Keep reading to see how Land O’Lakes increased CTR with a real-time CDP.

Future trends in customer data marketing

While customer data marketing continues to be integral to how businesses create personalized engagement, the direction of future technology may impact it. Here are some of those to watch.

• Cookieless tracking: Some countries have already banned the use of cookies, while many web browsers have restricted or no longer support third-party cookies. Hence, more brands will adopt cookieless tracking. Implemented on the server side, these are scripts that only run when a person visits a web page. It allows them to collect privacy-friendly first-party data. 
• Real-time personalization: The integration of AI in customer data platforms (CDP) will enable brands to track live interactions to deliver personalized content and experiences on the go.

FAQ section 

What is customer data marketing?

Customer data marketing is the use of customer data to create tailored, targeted and personalized marketing content and campaigns.

Which data types should businesses focus on?

Businesses can focus on identity, interaction, attitudinal and behavioral data as these are the main types of customer data for personalized marketing.

How do privacy regulations affect personalization?

Data privacy laws like GDPR and CCPA ensure businesses are ethical and responsible in how they collect and use customer data. This ensures proper security and transparency.

What tools are key for successful customer data marketing?

CDPs, marketing automation platforms and analytics software are relevant tools that support customer data marketing.

Learn more

Customer data marketing allows brands to form strong connections with their customers, improve engagement and drive loyalty via personalized experiences. 

To harness it, you would need the right data and tools. This could be a customer data platform, marketing automation, analytics or AI.

Contentstack offers the best-in-class CDP that empowers you to unify customer data, generate actionable insights and orchestrate personalized interactions in real-time. Talk to us to learn more and get started today.