Dive Brief:
- According to the Direct Marketing Association’s “The Value of Data: 2015” report, data-driven marketing added $202 billion in revenue to the U.S. economy in 2014 -- a two-year lift of 35% as well as adding jobs in all 50 states.
- Data-driven marketing and individual-level customer data benefit marketers through measurable efficiency in marketing strategy and media buying as well as provide greater marketing insight through testing.
- The report also found that data-driven marketing provided a lower barrier to marketing entry through lower cost channels such as search engine marketing, compared to traditional higher cost channels like TV advertising.
Dive Insight:
Overall the DMA report found that the data-driven marketing space is growing both in value and size. Not surprisingly, different businesses collect, analyze and use individual first-party data in very different ways. "Almost every marketer has its own house file of customer records (first-party data) which it uses 'as is,'" per the report.
It also found that third-party data is becoming more important for data-driven marketing, estimating that services that rely on third-party data have risen in net value "added by $12 billion, or 39% relative to 2013," the report said. Further, value added by services that don't directly rely on servicing first-party data rose 24%. And what's more is that nearly $102 billion of revenue in the sector -- almost 500,000 jobs -- depend on individual-level third-party data, per the report.
"A responsibly managed market in third-party data is vital to the survival of news and other forms of branded media in the face of media that don’t need third-party data because theirs is first-party data," the report reads.
Data and technology are two tools that have become necessary components of the marketing process. As more data becomes available to marketers, we will see more companies devote more resources to both aggregating it and also applying it.