What is Database Marketing and how to deploy DBM in your company – WAU

Database Marketing is a strategy that proposes the collection and analysis of data to optimize the consumer experience. In times when this factor is essential for a brand’s results and reputation, understanding how DBM can be implemented represents a real competitive advantage.

In the 1960s, American Jerome McCarthy defined 4 essential factors for the success of a strategy. It was the birth of the famous Marketing Mix.

At the time, the relationship between companies and customers was considered vertical, which facilitated the influence on people through advertising campaigns.

If he lived today, however, the academic would have to add at least one element to his theory: the uniqueness of consumers. Today, the reaction that a campaign causes is different for each customer.

In an environment that encourages competition and facilitates access to information, structuring a good marketing plan without segmenting the audience is an impossible mission. At the same time, technological advances allow the process to be carried out more and more efficiently.

With the application of Database Marketing, it is possible to establish fruitful communication with the public. In this post, we will explore this concept and discuss tips for inserting it into your company. Come on?

What is Database Marketing?

To help understand this concept, let us recall the characteristics of the modern consumer profile. As defined by Philip Kotler in the book Marketing 4.0, he:

  • relies more on the opinion of third parties than on advertising actions;
  • expects the company to have values ​​and act on them;
  • it has wide access to technology and information;
  • values ​​good service and a satisfying experience;
  • gives preference to brands that offer personalized communication.

Observing these traits, it is clear that a company needs to know its target audience deeply.

More and more, companies seek to achieve this with the creation of a persona, which is nothing more than a semi-cunning profile that represents the ideal customer. However, the question is: how to gather the necessary information to personalize the relationship with the public?

That’s where DBM comes in. Using Big Data concepts, this approach seeks to collect, process and store in databases all information related to consumer characteristics and preferences. From them, it is possible to generate valuable insights about the most efficient strategies and, thus, enhance the results.

Think, for example, of a real estate company that works with properties of all categories and, consequently, has very varied personas.

When launching email marketing campaigns, what is the point of offering the same house to a single low-income person and a householder with high investment power?

If the same company invests in Database Marketing, it has the possibility to segment its contacts according to its peculiarities. Thus, waste with unsuccessful campaigns is avoided, increasing the chances of achieving a conversion.

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Who uses this strategy?

We use the example of a real estate company, but the fact is that DBM can be used by companies in any sector, as long as they use a bank to gather pertinent data.

Naturally, the larger a company, the larger its consumer base, which increases the sampling and optimizes the entire process.

Among the staunchest users of this strategy, are financial institutions, retailers, insurance companies and B2B businesses. Still, it is valid to say that the most famous examples come from outside this sphere.

Facebook and LinkedIn are companies that apply Database Marketing excellently.

Noticing this is not difficult. Just look at how Mark Zuckerberg’s network segments its users by name, age, gender, location and general preferences. Thus, the company gets a way to monetize with targeted ads.

Although the companies mentioned are giants, this does not mean that a small enterprise cannot take advantage of the strategy on a smaller scale.

Let’s imagine an e-commerce specialized in fashion articles. The technique can help in the search for new consumers and, mainly, in the maintenance of customers who have already made purchases.

How to apply DBM in your company?

It is already clear that the effective application of Database Marketing requires the collection of data that can bring beneficial insights to your business.

But what structure must be put in place for the strategy to become viable? The first step, as usual, is the identification of your target audience, a step that can be optimized by creating a persona.

Therefore, it is ideal to start collecting information with already known customers or people who, in some way, made contact with your brand..

These data can be gathered in different ways. Encouraging the filling out of forms and recording customer activities on your website or establishment are common techniques. Here are some data that may be useful:

  • demographic: age, gender, education level, location, etc .;
  • acquisition: channel or campaign that took the customer to your company;
  • technological: the consumer’s preferred channels and devices;
  • of activity: level of interaction and engagement with your brand on the internet;
  • transaction: frequency of purchases, average ticket and commercial preferences.

It is worth remembering, however, that the information must be gathered in a non-abusive way. That is, it is necessary to be transparent with the customer and use their data with care and ethics.

In addition to avoiding the erosion of your company’s image, these practices avoid legal complications. In 2020, the LGPD comes into force, legislation that regulates this type of activity.

Finally, it is crucial to establish collaborative communication between the different departments of the company. Only with the alignment between marketing and sales, it is possible to use the strategy to your advantage.

For that, choosing the use of good software can be fundamental. In the rest of the article, we’ll talk more about how DBM can work in practice.

What types of actions can be done with Database Marketing?

In general, the objective of Database Marketing is to improve the company’s results by optimizing the experience of its customers. Therefore, in some way, all actions that can be done are related to targeting. One of the clearest examples is email marketing.

This form of communication is widely used to nurture contacts and keep them interested in doing business with your company. As we have already discussed, email marketing only reaches its maximum potential with personalization. By separating leads according to their characteristics, you trigger messages with the greatest potential for engagement.

DBM is also effective for engaging in social networks. Understanding, for example, the times when your audience is most active on Instagram allows you to invest in more accurate campaigns.

With that, you have the guarantee that your persona will be online at the time of a live, which opens space for extremely targeted actions.

This idea is replicated in any type of promotion or offer. With data analysis, you gain knowledge about the products that most attract the attention of the consumer, as well as the most appropriate language to engage them. Thus, with the possibility of a considerably higher conversion rate, you reduce unnecessary expenses.

Seasonal promotions

Seasonality is a term that refers to the increased demand for certain products at certain times.

On Mother’s Day, for example, the sale of flowers, chocolates and other items that serve as gifts tends to increase.

The same happens with electronic equipment in the days around Black Friday.

However, it is useless to join the wave without knowing your audience. If your consumers are predominantly single women, investing in advertising for Valentine’s Day is not a justified idea.

The only way to get it right is to create a database by collecting data, which can be consulted to determine if the investment is worthwhile.

Qualified Leads

Leads are people who, at some point, have had some interaction with your company, leaving some type of contact behind.

It is clear, however, that not everyone who filled out a form on a landing page or followed their brand on Facebook will become customers. Therefore, leads are segmented according to their conversion probability.

Through nutrition campaigns, you can turn people who know little about your brand into loyal consumers. In this approach, when a lead is labeled by the marketing team as someone prone to making the purchase, it is passed on to the sales team as a qualified lead.

Contacts placed in this category are much more likely to convert. Thus, your commercial team has the opportunity to increase its own success rate, since contact with these individuals tends to be much more fruitful. By focusing on the right targets, the reduction in your acquisition cost per customer (CAC) will be noticeable.

The budget spent for the implementation of DBM should not be seen as a mere expense, but as an investment.

The correct application of Database Marketing enables the increased sales, improved sales success rates and overall optimization of your relationship with customers.

As a bonus, you still perfect your campaigns, an act that opens space to reduce costs and, consequently, boost profits.

So, what do you think of applying Database Marketing in your company and boosting your results? We mentioned that the alignment between the marketing and sales sectors is fundamental for the success of the strategy. Want to know more? In this post, we explain the relevance of Vendarketing for companies!