When you hear the term “predictive marketing” what comes to mind? Many marketers imagine a fortune teller looking into a crystal ball predicting what customers will close and when. But, while a fun image and enticing concept, that simply isn’t accurate.
There is a lot of confusion out in the market about the term predictive marketing. Marketers, vendors and analysts alike are using different definitions for the term—making it even more confusing to understand what it means and how it can help your business.
We want to help by clearly defining what predictive marketing is and what it can and can’t do for your business. And to find out more download our brand new cheatsheet What is Predictive Marketing?
Predictive marketing is the practice of extracting information from existing customer datasets to create a data model—both from your own database and existing company data aggregated through a predictive technology—to determine patterns and predict future outcomes and trends with an acceptable level of reliability.
What do we mean by acceptable level of reliability? Predictive marketing can help you forecast what accounts look like your best customers. Based on a predictive marketing technology’s intelligence, you know that an account has a higher propensity to buy. Your data model encompasses three elements:
- Fit: How much an account looks like your best customer
- Engagement: How much an account has interacted directly with your company
- Intent: Key actions across the web that indicate buying intent for both known and unknown accounts
Basically, predictive marketing uses data science to provide you with a potential outcome based on reliable data—not a crystal ball.
There are generally two different use cases for predictive marketing—predictive demand generation and predictive scoring.
Predictive Demand Generation
Predictive demand generation leverages your data model to determine what accounts and leads out there in the marketing universe are a best fit for your product or service. So instead of casting a wide top-of-funnel net and wasting money on countless campaigns that attract whoever will listen, you can be much more targeted with your efforts.
Predictive marketing technology tells you what accounts make the most sense to target. Once you have that information you can target your audience with specific paid programs, content that resonates with that audience, and explicit messaging.
So instead of generating a large quantity of accounts and leads that may not be a great fit for your company, you can target high quality accounts that look like your best customers.
Plus, predictive demand generation is a great addition to any Account Based Marketing strategy. Instead of guessing which accounts you should target, you can make much more intelligent decisions based on data.
Predictive Lead Scoring
Another aspect of predictive marketing is predictive lead scoring. Using your customer model, a predictive solution can help you prioritize the accounts and leads that are already in your database, so you know how to more effectively market to them. Plus, using predictive scoring you can pass the best leads to your sales teams—so they can focus on accounts and leads that are more likely to convert into customers.
Predictive marketing is just getting started and is set to be a key piece of the marketing stack. Imagine all of the possibilities when you combine data science with your marketing!
Want to learn more about predictive marketing? Download our new cheatsheet What is Predictive Marketing?