Predictive Marketing: accurately predicting the market with “Big Data”

Do Forecast and Predictive differ?

“Yes, they do. Forecast is using historical data to plan, while Predictive is more accurate because it knows what a person or group will buy, which is more forward-looking than Forecast.”

Have you ever been like this, business owner?

• Do not know what customers will buy.
• Know what customers’ behavior is.
• After customers buy something, do not know what they will do next.

This marketing topic is not entirely new, but I would like to follow the trend of the new book by Philip Kotler, Marketing 5.0. One of the topics that Grandpa mentioned is what we will talk about today.

Predictive Marketing

Predictive Marketing is a marketing concept that predicts customer behavior, such as what a customer will buy next or what a customer who has already purchased from us will buy in the future. Predictive Marketing can make these predictions based on data such as purchase history, demographics, and other factors.

The accuracy of Predictive Marketing depends on the quality of the data. Companies that use Predictive Marketing successfully, such as Amazon, have access to a large amount of data about their customers.

The benefits of Predictive Marketing?

1. Makes marketing more efficient, reduces costs, and makes money more valuable.

What happens is that companies that don’t know Predictive Marketing spend a lot of money on marketing, such as spending tens of thousands of baht per month on Facebook ads, Google ads, or advertising through other channels such as buying TV ads to try to get people to know us or to try to get people to consider buying our products.

In contrast, companies that use data to predict customer behavior will have a list of customers who are likely to buy. These companies then use telesales, Facebook ads, and Google Ads using email and phone number databases to use marketing budgets more efficiently because we already know who is interested in the product. For example, if we are selling products for pregnant women, we can shoot ads to pregnant women, which will allow us to sell a lot of products. On the other hand, if we shoot ads to single people, of course we cannot sell products. Therefore, we should find out who we should sell products to.

Or the website of a supermarket, collect data for Predictive Marketing by collecting data from people who visit the website to see baby products. They will see that this group of people is likely to be pregnant, so they send promotions to their homes, discounts for buying products for pregnant women, which helps to stimulate sales significantly.

2. The competitive advantage

If we know the customer’s buying behavior, what they buy, what they don’t buy, we also know what we can sell… Like married men who have children, every Friday, they will buy beer paired with pamper. The supermarket thinks that if these two are paired together and compared in sales with having them separated, it turns out that if these two are paired together, there are actual sales. But there won’t be sales for the other items. However, if these two are separated, there will be sales for other items in between.

3. Create a good customer experience

Create a good customer experience, such as Amazon’s website, which recommends similar products to customers so that customers can compare and get the best.

4. Extend the Customer Lifetime Value for customers who stay with us for a long time

These customers are the ones who will recommend our products to others without us having to do anything. They are our advocates and promoters. We want these customers because they will lower our marketing costs. They will also let us know what they will buy next, so we can keep our products in front of them. This gives us the opportunity to grow our profits from existing customers without having to acquire new ones, which is a good thing.

5. Acquire new customers

If we know the customers who have this kind of behavior, and their demographic data, such as gender, age, marital status, occupation, and income, are likely to be our customers, then we will know that these groups are the targets that we can scale our customer base.

How to get started with Predictive Marketing?

(We will use SMEs. as an example)

1. Collect data in Excel or Google Sheets. In an organization, there are two types of data: raw data (unprocessed data) from customers, surveys, customer logins, external data, online embedded data on websites or Facebook, offline such as sending surveys.

2. Data management is the process of grouping customers with similar or aligned behaviors. For example, men aged 25 and over tend to buy six or more cans of beer at a time, men under 25 tend to buy one can of beer at a time, and men over 60 tend to buy wine. This allows us to infer that men over 60 may buy wine because it is good for their heart, while men 25 and over may buy six or more cans of beer at a time because they are partygoers.

3. Make the data easy to understand by presenting it in a visualization format, such as graphs and charts that are easy to understand.

4. Analyze the data to identify products that customers are likely to buy next.

5. Generate ideas from the data.

Summary

Predictive Marketing is a type of marketing that uses data, big data, or any amount of data to make predictions about future customer behavior. The more data you have, the more accurate your predictions will be. You can use programs like Microsoft Excel or Google Sheets to analyze your data, but if you’re a programmer, you can also use Python or other statistical software.

Once you have analyzed your data, you can look for patterns in customer behavior. For example, if you notice that customers who buy a camera also tend to buy a photography book, you can predict that they are likely to buy a camera lens next. Similarly, if you notice that customers who buy a camera lens also tend to buy a camera bag, you can predict that they are likely to buy a camera bag next.

The more data you have, the more accurate your predictions will be. If you have high-quality data with a 70-80% accuracy rate, you can expect that 70-80% of the people in the target group will click on your ad when you run it.

Big Data is essential for business. If you’re interested in collecting and using Big Data, Birth Note has the technology to help you manage your data accurately. We’re also happy to consult with you to help you get the most out of your Big Data.

For inquiries about Birth Note services, please call 099-564-5947, 096-142-9547 or email [email protected] for us to get in touch with you.