If Data Is the New Currency, How Should You Spend It?

I’ve heard fellow marketers say that “data is the new currency” more times than I can count in recent years.

But what does that even mean?

The mantra lacks definition. If data is the new currency, how do I spend it? And what am I even buying with it?

It simply reduces to the reality that business – especially marketing – is increasingly digital.

For sure, the current data revolution is creating countless opportunities for marketers, launching audience targeting to the next level and introducing the tools and information to develop an in-depth understanding of our audience, their values, their preferences and their behaviors.

This information drives better media decisions and spending, and contributes to more accurate targeting and measuring — all of which provide significant contributions to the bottom line.

But that doesn’t make data a “currency.” Rather, its money-like status derives from the flood of first party customer data flowing to companies in virtually every industry.

In other words, everybody has it, is learning how to use it, and – most importantly – can now exchange it across departments within individual organizations, as well as with external partners.

These unique datasets can be traded and interchanged by businesses, shaping dynamic trade relationships that enhance customer targeting capabilities and enable all stakeholders to uncover, create and satisfy consumer needs and desires.

Ultimately, there are two key ways marketers can ‘spend’ their data. Let’s look at each.

Internal cross-pollination

Digital marketing has evolved from the ‘data wild west’ days of yore, when we had more data than we knew what to do with, and finding effective ways to use it was anything but straightforward.

From customer data platformsOpens a new window to account-based marketingOpens a new window , new tools, technologies and strategies gather, organize and leverage all that consumer information to provide marketers with high-value insights.

As Mike Sands, president and CEO of marketing technology firm Signal, writes for Forbes: “Too often, brands think that their underlying asset is their physical product, not knowledge of their customers. But today businesses are competing with next-generation companies that don’t have product legacies. Instead, they are built on a foundation of customer data, which enables them to discover, fulfill and create new consumer desires.”

In other words, this consumer data not only enhances audience targeting and lead generation, but can also impact sales and customer loyalty. Indeed, every team dealing with sales and growth can benefit significantly from access to this information.

The problem, however, is that departments within many businesses keep the insights to themselves. As Giles Ivey writesOpens a new window , “as it stands, these facts are not being shared. And so the silos of the real world, which separate different departments to their detriment, are now being replicated in the digital one.”

This is a problem, as Ivey explains, because many brands must deal with “a growing chasm between marketers searching for views, clicks, and likes, while the rest of the company hunts down sales and growth.”

These data silos should be broken down.Opens a new window  Internal cross-pollination of consumer insights is a must.

In that sense, using – or spending – data internally serves more than simply to improve marketing campaigns. That marketing data can be leveraged across a company to boost sales and enhance the customer experience.

To embrace data as an internal currency means that brands must unify data silosOpens a new window and become data-centric at their core. Customer data insights should be exchanged between departments and used by everyone in the business, all the way up to the C-suite.

Circulating data externally

Generally, focus has been particularly on ways data can be used to enhance the personalizationOpens a new window of media, e-mail, mobile and other digital marketing initiatives.

But brands need to start pivoting, and prioritizing other uses for their customer data.

This gains importance as the major digital advertising players dominate the landscape. In fact, Amazon’s unprecedented ascendance – last year it became the world’s second trillion dollar companyOpens a new window – has in large part been driven by the way the company takes advantage of every bit of available customer data.

With this consumer information, especially on all its customer’s website interactions, the online retailer has shaped the most convenient and personalized shopping experience possible. Amazon knows everything about how, what and why people shop online — all thanks to that marketing data.

It’s this data-first focus that has made it one of the world’s major advertising giantsOpens a new window , alongside Google and Facebook. These companies are turning their advertising platforms into walled gardens, closed software ecosystems in which all capabilities and operations are controlled by the ecosystem operator. Dynamic consumer data helps them build those walls.

Marketers must adapt by being free of the garden, chasing the opportunities available to us by exchanging the data we already have — and own — with partners.

This information, if exchanged effectively, can help all stakeholders make better-informed business decisions through a deeper understanding of our customers’ buying journey. These types of strategic data partnerships can shape the new system through which the ‘data currency’ can be exchanged.

As Mike Sands explains, banding together through collaboration would allow us to “forge comprehensive and scalable customer data assets to drive smarter strategies to meet customer needs, create more valuable engagements, even open up new revenue streams — all of which leads to better bottom lines.”