Data Collection has gotten a bad rep in the news recently. And, well, it always has – when terms like Data Collection are used, it almost is always in a negative light. One thing that you may not realize, though, is that when data collection is used properly and in an ethical, helpful way – almost nobody notices or talks about it!

Data can do some great things, for both customers and businesses.

Data on you as a consumer runs a lot of the things you interact with daily. The GPS app on your phone uses it to estimate your trip time, and Netflix used it to suggest that great new series you binge-watched last weekend. Data, when used properly, is a give and take relationship that benefits all.

Data Helps Avoid The ‘Anyone Who Will Buy’ Approach:

Many small businesses we work with are initially selling to anyone who will make a purchase. This at first glance makes a sense, in business a sale is a sale. However, this strategy doesn’t translate well to marketing – spending your time marketing to just anyone leads to wasteful ad spend. While you may see average or sometimes great results from loose targeting settings, a well dialed in marketing campaign can work like magic.

Using Pay-Per-Click Marketing as an example, if you are paying $2 a click and get 20 clicks, you are looking at a cost of $40. For an effective marketing campaign, the goal is to make those 20 clicks as impactful as possible. We do that by only showing the ads to the most likely customers, and excluding everyone else with specific targeting settings.

How Small Business Can Leverage Data:

You don’t need a marketing department or a large budget to make your business more effective. Your use of data can be as simple as a monthly audit of customer purchases and some web analytics or can be as complex as an all-inclusive customer database that manages every interaction.

For marketing purposes, there are two main sources of data we’re Interested in when working with small businesses.

#1 Demographic and Purchase Behavior Type Data:

As much as you may think you have your customers figured out, expect some surprises here! In our experience, there are always stones left unturned and gold left to be mined. You may find that your largest sales happen on a Tuesday, or that customers who order by phone place orders that are 25% more profitable.

This type of data typically isn’t personally identifiable to any individual and can come from a variety of sources, some as simple as interviewing employees and creating more detailed sales sheets.

Whenever possible, the preferred method is an Analytics platform such as Google Analytics, Facebook Pixel Data, etc. because, among other things, that information can be used to serve ads to individuals who have visited your site. If you’ve ever visited a website and their ads follow you around the web, this is why.

Regardless of how the data is collected or used, we want to know things like:

• Average Customer Age
• What Geographic Location Customers Come From
• What the Average Purchase Consists Of
• Average Profit Per Sale
• Most Popular Items
• The Channels Which Customers Found You (Social Media, Google, Etc.)

All this data can be scrutinized at a granular level from all different angles to identify areas of improvement in the customer acquisition, sale, and follow up process of a business. And, as discussed, the web analytics data can be used to create really targeted ads.

Collecting and Managing This Type of Data:

In today’s digital world, much of this data collection can be automated. Demographic information is readily available if you have a business page on Facebook, Twitter, Instagram Business Account, Etc. and can also be collected by installing Google Analytics on your website.

For sales data such as average purchase information, it much depends on the type of business you run. If a lot of sales happen online through E-commerce, it is likely that this data is readily available already on the platform you are using.

For Brick and Mortar retail or service businesses that deal directly with customers, this may present more of a challenge. If you are using inventory management or a Point-of-Sale System such as Stripe or Square, this data is likely readily available also.

Worst case scenario, a simple excel sheet to track sales can provide some insight into the day-to-day activity in your business.

With This Type of Data You Can:

• Learn More About Your Customer Base As a Whole
• Craft Ads That Are Tailored to Your Specific Audience
• Reduce Spending By Only Showing Ads To Those Most Likely to Buy
• Adjust Your Offering to Be Aligned With Customer Needs

#2 Personal Contact Information

This type of data, as the name implies, is personal. This is an area to tread lightly in. Every locale has its own laws regarding this topic, and it is up to you to do your own due diligence in this area. If you sell items of a sensitive or discrete nature or deal in anything medical related, do some research. Besides simply annoying customers, misusing personal customer information can have legal implications.

With that said, there are many uses to contact information a customer provides you with, such as:

• Email Marketing
• Lead Lists for Sales Calls
• Direct Mailing Campaigns
• Text Message Marketing
• Custom Facebook Marketing Audiences

These methods, when used properly and appropriately, can have great response rates and improve the experience your customers have with your business. If you have customers who provided you with their contact info because they are interested in your business and its products, and it would be crazy not to let them know when a major sale is going to happen!

Collecting and Managing This Type of Data:

There are many ways your customers can provide you with their information. You can run ads about your products or services and collect information on those interested, you can also just have an request for info sheet you pass onto each new customer that comes through your store.

More importantly than how it’s collected is how it is managed and used. There are many Customer Relationship Management tools available out there that can help with this. Hubspot even has one that is free. As always, there is also the simple method of compiling an excel sheet.

Whatever system you use, a campaign using this data can be run by knowing three things:

• What service or product this customer is interested in
• How they signed up to the list
• A method of contacting the customer (Email, Phone, Etc.)

With those three things alone, you can run something as simple as a mass email campaign that has the potential to generate a lot of revenue

In Conclusion…

With a little work and some creativity, there are many ways you can expand your business using data already available. The important thing to remember is there are ethical and unethical uses of data – and if you push the boundaries you may alienate your customers. Nobody likes to be constantly be bombarded with sales calls, ads, and direct mail. I

f you have good intentions and put the best interests of your customer at the core of your marketing strategy, your business will greatly benefit!