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Why Marketing Needs Data


Marketing departments have always relied on data to create targeted, accurate and personal advertising campaigns. Since the entire world moved online the collection of data has become more important than ever for the marketing department of any business in appealing to new customers and keeping current ones.

The rate in which customers leave a service or company after a certain period of time is called a ‘churn rate’ with the average company churn rate at 20.7%; that means for every 1,000 customers a company has at the beginning of the year, 207 will have left the company within twelve months. This seems to be a shockingly high percentage and leaves me wondering why so many people opt out of a service after so little time. The Data Services Department at the Royal Mail conducted a review to explore why marketing needs data and how data could be the solution to growing customer churn rates.

Data collection

It’s unsurprising that the two most popular channels used by marketers for targeting, creating, personalising and delivering content are email and online advertising. Email is responsible for 86.6% of data collection – as seen in Figure 1 below – followed by online advertising at 62.7% and search engine optimisation at 53.2%; it may not shock you to find traditional face to face data collection has fallen to just 44.4%. With a churn rate of over 1 in 5 customers it’s clear that acquiring customers, and retaining them, is a growing challenge for marketers, constantly having to replenish the significant number of those departing. To find out what the customer wants, data needs to be collected.

Fig 1 - Why Marketing Needs Data

Websites have a double benefit for marketers not only as a source of transaction but as a method of collecting rich layers of customer and behavioural data with 9 out of 10 companies using their site as a primary data collection source.

Life Events

Minor life events, such as changing your email address or buying a new car can have similar implications to that of major life events such as moving home, having children or changing jobs in terms of the effect it has on a marketing department. In fact, the most significant life event, as rated by marketers, is a change of email address which scored 3.98 out of 5; this isn’t surprising when 86.6% of data-driven marketing is conducting through email.

These life events are seen as a huge opportunity by any successful marketing department; during such life events a person may have to purchase new products and services or review what they are currently signed up for. It’s because of this that over half of marketers would find it useful to know when a customer may be considering a switch of supplier due to a life event with 49.7% seeing a life event as a sales opportunity – as seen in Figure 2 below. As it stands, the majority of marketers are likely to only learn about a customer’s life event when they call up to switch provider.

Fig 2 - Why Marketing Needs Data


The three major data problems faced by marketers today are incomplete data, out of date data and missing data – as seen in Figure 3 below. According to the Royal Mail review, all of these issues can be solved with additional third-party data and service providers.Fig 3 2 - Why Marketing Needs DataData quality is key since it impacts on deliverability and the direct message of the campaign. Getting the data wrong can either mean sending customers irrelevant data or sending data to irrelevant or non-existent email addresses that have been entered incorrectly. The majority of websites request customers to supply information for their database however ensuring that the information is correct and up to date is not only of pivotal importance but a requirement in the Data Protection Act. Because of this, almost 50% of companies validate customer details at the point of capture by asking customers to re-enter certain details such as their email address.


Though technology has evolved rapidly in the past decade, the biggest obstacle marketers come across in data-driven marketing is their database platform. 30.8% claim that technology is holding them back along with budget requirements (31.3%) and general company culture (39.6%). From Figure 4 below, it seems as though the lack of required data is not the issue, with only 27.5% citing that as an obstacle, rather, it’s the method of collection and understanding towards data that is the main setback in data-driven marketing.

Fig 4 - Why Marketing Needs DataPermission

Collecting data directly is an effective way of ensuring accurate and rich customer details for future campaigns. 45% of companies only use customer data that they have directly collected however half of those companies recognise that data can be enriched with additional third-party data giving them a more rounded view of their customer database. Data collection can be a tricky area however ‘permission marketing’ is not only the best practice to uphold but will soon be a legal requirement; yet 1 out of 3 companies say they only have a limited understanding of permission marketing and 1 out of 10 have no understanding at all. If permission marketing isn’t practiced then companies may find that their data is not legally compliant as well as inaccurate.

Explaining the importance of this research, Jim Conning, Managing Director at Royal Mail Data Services, said, “Reaching a consumer with a relevant message at a key moment in their life enables marketers to build customer loyalty and re-engage with them. With average annual churn rates standing at 20 per cent, businesses are having to spend twice to regain lost customers and stop others from leaving. Brands must find new ways to harness better the power of their customer data if they are to understand not only who and where their customers are but also when and why they need a specific product or service.”

For the full report by the Royal Mail, click below:

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