Forbes stated that 47% of today’s digitally mature enterprises have an artificial intelligence strategy in place. Being on the leading edge of such automation practices enables your company to increase its ROI.
Predicting how customer segments are behaving and adapting correspondingly becomes essential for achieving exceptional performance. Take a look at this new marketing analytics trend and our recommendations to understand what predictive marketing is and how your company can start using it today.
What is Predictive Analytics, and how accurate is it?
Predictive analytics is “the use of data, statistical algorithms, and machine learning techniques to identify the likelihood of future outcomes based on historical data,” according to SAS.
Data scientists use algorithms to identify new patterns and trends hidden within significant amounts of information. The patterns identified are then used to create predictive models that try to forecast future behavior.
Extracting real meaning from data can be challenging. Insufficient data, flawed processes, and the misinterpretation of results can lead to inaccurate conclusions and bad business decisions.
The accuracy of predictive analytics depends on four variables:
1. what you are trying to predict
2. how much historical data you have to build your sample
3. how far into the future you want to predict
4. On whether you have integrated all appropriate data that will affect the outcome.
With a sophisticated implementation of advanced analytics and data integrated from all relevant, different data sources, the results can be entirely accurate.
The advantages of predictive analytics in marketing
Having now understood what predictive analytics and marketing are, the question is, why is it so important?
With in-depth data from predictive marketing, companies can optimize the user experience of their websites, services, and products.
Stay one step ahead
Companies’ marketing efforts cover many marketing fields: content, SEO, email, social, PPC, etc. Moreover, it requires a lot of time, from planning to publishing. Indeed, predictive analytics will determine what actions are most likely to succeed or fail.
Using predictive analytics will solve these issues by:
- Generating more leads
- Converting leads to customers
- Understanding the ROI of marketing activities
- Reducing customer acquisition costs
No more budget wastes
Using this type of technology in your business, you can reallocate efforts and budgets in profitable segments or channels. It also helps your team know your business and customers better.
Three easy steps to implementing predictive analytics
You probably think that getting started with predictive analytics and marketing will be very difficult. But the whole point of using AI and automation is to make your business easier. So we listed the different steps you need to follow to begin implementing predictive analytics.
Step 1. Ask yourself the following questions
What are my goals?
How will predictive analytics help me achieve my goals?
Step 2. Focus on the right KPIs
Every company is different, but there are some specific metrics and channels you might want to track as you start using predictive analytics in your marketing.
It includes Key Performance Indicators such as:
- Cost per acquisition
- Customer lifetime value
- Bounce rate
- Average time spent on page
Step 3. Focus on the right channels
You also want to pay attention to which channels are performing better like:
Using predictive marketing will help you make better business decisions, improve productivity, and ultimately grow at a faster rate. It is the best investment your company could make as it finds patterns and creates forecasts on leveraging to increase your performance.
You might want to think about developing your software, but it would take months and a dedicated team. Meanwhile, you can start a free trial with nexoya to see how this type of marketing solution fits your needs.