Digital Marketing: data-driven or data-led?

What is data-driven marketing?

In data-driven marketing, you put your data at the heart of your business and marketing team's decision-making. As a data-driven organisation, you collect data such as website data, click behaviour, buying behaviour and locations, and then hopefully you can filter and analyse them. This approach enables you as a company to act quickly and correctly and therefore the use of data can fuel decisions.

We all know the internet phenomenon. Have you visited Coolblue to look at refrigerators? Then there are sure to be fridges shining all over your visited web pages. Indeed, Coolblue, a fine example of data-driven marketing.

Why go data-driven?

Ultimately, it all depends on what kind of organisation you are and how you want to position yourself in the market. By using a data-driven approach, you eliminate many of the human biases that play a role in your decision making, especially when you use big data. By working with automation and artificial intelligence, you spend far less time analysing the results. And that human interaction? It's still there! After all, you determine how you generate impact with your acquired insights.

Let's have a look at the example of Coolblue. We can say that investing in this type of advertising is worth the budget because we are targeting consumers who have the intention to buy that product.

But being data-driven also takes time. And not everyone has that time. For organisations, it can be a challenge to go fully data-driven because of limited internal resources and possibilities. The first step in this process is to set up data lakes, where you can collect all your observations and data, and then start using them.

So what is the difference between data-driven and data-led?

Many people use both data-driven and data-led in conversations, meetings and presentations. Are they the same thing? Well, both approaches are actually quite different.

Let's zoom in on some friends who want to go out for dinner on Saturday night. They are discussing which local restaurant to go to and soon conclude that they fancy Italian. They know the restaurant around the corner very well, especially the delicious desserts. But then they flip open their laptops to see if there are other restaurants they haven't tried yet. Using Google Maps, they find an excellent rated vegan restaurant just 50 metres away that they have always wanted to try. Not only is this restaurant of top quality, but it is statistically healthier than the competitor 300 metres up the road.

The restaurant search is just one example of how data can be used. We can see that data has influenced the decision of the group of friends.

The huge amount of data sources we can collect, together with the ease with which we can process these figures, have given us a wealth of information with which to make decisions. These decisions become more complex as we have to weigh up huge sets of data. It is then crucial that we do not leave these decisions to machines. Simply put, they do not yet understand the nuances of human emotion, desire or creativity.

And the human touch?

At Tobania, we believe in data-driven technologies that complement, not replace, human intelligence. We use both the data-driven approach and the data-led approach within our digital marketing studio (Tobania.Digital) to support this.

Data should support and inform consumer and business decision-making in the same way, not drive it. As more and more organisations move to data analytics, we need to be aware of the subtle nuances between a data-driven and a data-led approach if we are to avoid mismanaging information.

Want to explore the impact data can have on your business? Give us a call, and we'll be happy to help.