In the digital age, data drives everything. With so much information at the fingertips, marketers can optimize every aspect of their strategy.
While these numbers help evaluate performance, they don’t always give a precise prediction about the outcome of your next campaign. Knowing which factors will influence your final outcome is tricky when you’re only given so much information.
Even if you know which demographics are most likely to buy your product, it’s hard to predict how each individual will respond. However, using historical data is one-way marketers can predict outcomes and adjust their strategy accordingly before launching another campaign.
What is Predictive Analytics
Predictive analytics is the process of using data to make predictions about future events and inform future decisions. This isn’t new and has been applied to many industries beyond marketing, such as healthcare, education, and criminal justice.
Digital marketing campaigns often rely on large amounts historical marketing data, making it easy to collect, analyze, and use to predict future outcomes.
Predictive analytics is not just looking at data to see how something performed in the past and try to replicate it in the future; it is much more than that. It is a mathematical model that takes historical data and applies a formula to generate a future outcome.
How To Select The Best Tools To Use
When selecting the best tools, taking advantage of the available data is essential. You need to decide which metrics to focus on and how to organize them for efficient tracking. From there, you can start thinking about which tools would be most helpful for tracking and analyzing this data.
However, many platforms and plugins are designed for marketers who want to implement predictive analytics into their strategy. You may have heard of tools like IBM Watson, Google Analytics, or HubSpot’s marketing software.
While these platforms are effective, their usefulness and functionality depend on your working data. However, there are more specified platforms that can help you find the best historical market data that you can use to predict your tomorrow.
One general rule to follow is that the platform you choose should have valuable data and be able to integrate multiple datasets. It should be easy to track or search and organize all the data so that you don’t have to start from scratch.
Using Historical Data To Your Advantage
While you may want to revisit the path that got you to those numbers, more importantly, you want to know what led up to them. You want to look at your model and identify where you may have gone wrong. Since you can’t change the past, you have to work with what you have in front of you.
You need to determine what led to your results and use that information to inform your actions moving forward. You can break down your historical market data into the following variables.
- Metrics - These numbers show how much data you collected. They include impressions, click-through rate, the average cost per click, number of sales, and so on.
- Ratios - These numbers show relationships between your metrics. They help identify trends and other relationships that might affect the outcome of your next campaign.
- Variables - These factors might have led to your results. They include location, time of year, and competitor activity.
To optimize your marketing strategy, you need insight into what people are doing, what they’re interested in, and how best to approach them. Predictive analytics helps marketers better understand their audience and what to expect from their campaign.