Data-driven marketing for growth and profitability

Abstract

PurposeIn the current business environment, more uncertain than ever before, understanding consumer behavior is an integral part of an organization's strategic planning and execution process. It is the key driver for becoming a market leader. Therefore, it is important that all processes in business are customer centric. Marketers need to harness big data by engaging in data driven-marketing (DDM) to help organizations choose the “right” customers, to “keep” and “grow” them and to sustain “growth” and “profitability”. This research examines DDM adoption practices and how companies can aim to enhance shareholder value by bringing about “customer centricity”.Design/methodology/approachAn online survey conducted in 2016 received 180 responses from junior, middle and senior executives. Of the total responses, 26% were from senior management, 39% from middle management and the remaining 35% from junior management. Industries represented in the survey included retail, BFSI, healthcare and government, automobile, telecommunication, transport and logistics and IT. Other industries represented were aviation, marketing research and consulting, hospitality, advertising and media and human resource.FindingsSuccess of DDM depends upon how well an organization embraces the practice. The first and foremost indicator of an organization's commitment is the extent of resources invested for DDM. Respondents were divided into four categories; Laggards, Dabblers, Contenders and Leaders based on their “current level of investments” and “willingness to enhance investments” soon.Research limitations/implicationsWith storming digital age and the development of analytics, the process of decision-making has gained significant importance. Judgment and intuition too are critical to the process. Choosing an appropriate action cannot be done strictly on a rational basis.Practical implicationsThe results of the study offer interesting implications for managing the growing sea of data. An iterative and incremental approach is the need of the hour, even if it has to start with baby steps, to invest in and reap the fruits of DDM. The intention to use any system is always dependent on two primary belief factors: perceived usefulness and perceived ease of use; however, attitudes and social factors are equally important.Originality/valueThere is a dearth of knowledge with regards to who is and is not adopting DDM, and how best big data can be harnessed for enhancing effectiveness and efficiency of marketing budget. It is, therefore, imperative to build a knowledge base on DDM practices, challenges and opportunities. Better use of data can help companies enhance shareholder value by bringing about “customer centricity”.