Programme: Programme MSc Data Analytics

Course Title: Marketing and Customer Analytics

Course Code: MSCDA 614

Lecturer: Mr. W. Kanyongo

Cell: +263 772888909
E-Mail: wkanyongo@gmail.com
Learning Methods/Techniques

 Lectures
 Tutorials\Quizes
 Online Materials
 Group discussions
 Class Presentations
 Assignments
 Assessment Structure
Assessment is by coursework and examination.

Coursework (40%)
 One individual assignment
 One group assignment/presentation
 In-class test/in-class assessment

 Examination (60%)
By the end of the module the student should be able to demonstrate
how to gain insight from the analysis of data and to recommend an
appropriate course of action based on empirical evidence and apply a
statistical software package appropriate to handling customer data, for
example SPSS, Power BI, Google Analytics. Other: R, SAS, and
Python.
INTRODUCTION TO MARKETING ANALYTICS
DEFINITION of Key Terms

Marketing is a process where companies create value for customers and build strong
relationships with customers to get value from customers in return (Kotler and Armstrong,
2015, p.30)

The science and art of exploring, creating, and delivering value to satisfy the needs of a
target market at a profit. (Kotler, 2011).

Kotler explains that marketing is “meeting the needs of your customer at a profit.”

Marketing is about identifying and meeting human and social needs (Kotler and Keller, 2016)
Marketing is the activity, set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have value for
customers, clients, partners, and society at large
(American Marketing Association).
 Marketing identifies unfulfilled needs and desires.

 It defines, measures and quantifies the size of the identified market
and the profit potential.

 It pinpoints which segments the company is capable of serving best

and it designs and promotes the appropriate products and services.
 The definition extends beyond just communicating product features.
Marketers are responsible for a 360-degree experience.

 Every customer touchpoint from customer service to sales to

accounting and more are part of the “new marketing.
Data analytics (DA) is the science of collecting, inspecting,
cleansing, transforming, and modeling data in order to discover useful
insights, inform conclusions and support decision making.

Data analytics is a discipline focused on extracting insights from data

Marketing Analytics is the practice of measuring and analysing data and
metrics to understand the impact of marketing activities, maximize ROI
and identify the areas of improvement.

Marketing analytics comprises the processes and technologies that enable

marketers to evaluate the success of their marketing initiatives
Customer analytics, also called customer data analytics, is the
systematic examination of a company's customer information and
customer behaviour to identify, attract and retain the most profitable
customers.

Customer analytics is the process companies use to capture and analyze

customer data to make better decisions
 In the pre-digital era, marketing had gained ill-fame for being a heavy cost
centre. Marketers would spend a lot of money on promotional activities,
which were virtually non-trackable.

 Then came the era of Digital Marketing; with the introduction of analytical
tools, marketers could track each activity on their website.

 These Marketing Analytics tools enable marketers to invest their budgets

wisely and allocate their efforts and personnel to the channels that yield
the maximum Return on Investment (ROI).
 An effective marketing analytics practice tracks and collects
data across multiple marketing channels and consolidates it into
a single/common marketing view.

Over the years, as businesses expanded into new marketing categories,

new technologies were adopted to support them. Because each new
technology was typically deployed in isolation, the result was a
hodgepodge/hotchpotch of disconnected data environments.

Consequently, marketers often make decisions based on data from

individual channels (digital marketing and website metrics, for example),
not taking into account the entire marketing picture.

Social media data alone is not enough. Web analytics data alone is not
enough.
And tools that look at just a snapshot in time for a single channel are
woefully inadequate. Marketing analytics, by contrast, considers all
marketing efforts across all channels over a span of time – which is
essential for sound decision making and effective, efficient program
execution.
Ways Marketing Analytics Helps Your Business

1.Understand your target audience in greater detail

2.Identify where your competitors are investing their efforts

3.Measure how well your marketing campaigns are performing

4.Monitor current trends and predict future trends

5.Use data to decide the future course of action

With Marketing analytics, you can answer questions like these:

 How are our marketing initiatives performing today? How about in the
long run? What can we do to improve them?

 How do our marketing activities compare with our competitors’?

Where are they spending their time and money? Are they using
channels that we aren’t using?

 What should we do next? Are our marketing resources properly

allocated? Are we devoting time and money to the right channels? How
should we prioritize our investments for next year?
The Right Kind of Analytics

Difficulty
 Types of Analytics: Overview
 Descriptive: Uses business intelligence and data mining to ask: “What has happened?”

Descriptive analytics answers the question of what happened. It provides a

historical view of data to identify patterns and trends.
Examples: Monthly sales report, social media post engagement.
*Describe the data
• Common statistics:
− Counts
− Averages
• Typical reporting
methods:
− Tables
− Pie charts
− Column/bar charts 24

− Written narratives (Gartner, 2012)

 Diagnostic analytics delves into why something happened. It examines data to
understand the cause of events and behaviors.

 Diagnostic: Examines data to answer “Why did it happen?”

 (Gartner IT Glossary, 2015)
 Examples: Sales decline analysis and website bounce rate examination.

*Attempts to answer “why did it happen?”

• Drill-down techniques
• Data discovery
• Correlations

(Gartner, 2012)
Predictive analytics forecasts what might happen in the future based on past data.
Examples: Sales forecasting and customer churn prediction

 Predictive: Uses statistical models and forecasts to ask:

“What could happen?”

*Predicts instead of describing or

classifying
• Rapid analysis
• Relevant insights
• Ease of use

(Gartner, 2012)
What Predictive Analytics Cannot Do
“The purpose of predictive analytics is NOT to tell you what will happen in the
future. It cannot do that. In fact, no analytics can do that.

Predictive analytics can only forecast what might happen in the future,
because all predictive analytics are probabilistic in nature.”
(Bertolucci, 2013)

29
Prescriptive analytics suggests actions to take for optimal outcomes.
Examples: Inventory management recommendations and targeted marketing
suggestions.

 Prescriptive: Uses optimization and simulation to ask:

“What should we do?” (IBM Software, 2013)

(Gartner, 2012)
To get the most benefit from marketing analytics, you need an analytic
assortment that is balanced – that is, one that combines techniques for:

Reporting on the past.

 By using marketing analytics to report on the past, you can answer such
questions as:
 Which campaign elements generated the most revenue last quarter?
 How did email campaign A perform against direct mail campaign B?
 How many leads did we generate from blog post C versus social
media campaign D?
Analyzing the present

 Marketing analytics enables you to determine how your marketing

initiatives are performing right now by answering questions like:

 How are our customers engaging with us?

 Which channels do our most profitable customers prefer?

 Who is talking about our brand on social media sites, and what are

they saying?
Predicting and/or influencing the future.
 Marketing analytics can also deliver data-driven predictions that you
can use to influence the future by answering such questions as:
 How can we turn short-term wins into loyalty and ongoing
engagement?
 How will adding 10 more sales people in under-performing regions
affect revenue? Which cities should we target next using our
current portfolio?
DATA MINING
• Extracting information from huge sets of data.
• The procedure of mining knowledge from data
• Data mining happens when data professionals dig into large data sets to locate anomalies and
patterns in the data, and correlations within large data sets to predict outcome.
• Also involves other processes - data cleaning, data integration, data transformation, data
mining, pattern evaluation and data presentation
The 5 Major Elements of Data Mining

• Extracting, transforming and adding data to a data warehouse system.

• Storing and managing the data in a database system.

• Giving access to the data to information technology professionals.

• Using application software to analyze the data.

• Presenting the data in a helpful format.

To successfully mine information from a large amount of data, professionals use different
data mining techniques. A few data mining tools and techniques include:
•Descriptive modelling
•Predictive modelling
•Prescriptive modelling
•Association rule learning
•Decision trees
•Neural networks
•Regression analysis
•Data warehousing
•Market basket analysis
•Pattern mining for demographic sequences
Listed below are the various areas where data mining is used −
 Customer Profiling
 Identifying Customer Requirements
 Cross Market Analysis
 Target Marketing
 Determining Customer purchasing pattern
 Providing Summary Information
 Corporate Analysis and Risk Management
 Fraud Detection
Gone are the days when marketing companies had to rely on focus groups and case studies alone to get
relevant data.

data mining is a top market research strategy using market research software with built-in machine learning
and algorithms to glean insights from databases or other large stores of information

Data mining makes it possible for businesses and marketers to get customer data from databases powered by artificial
intelligence. This allows companies to create better marketing campaigns and marketing strategies. Big data is what fuels
data mining in marketing.

data mining in marketing enables real-time recommendations for businesses that track purchases. These
recommendations help businesses increase sales.

Due to data mining in marketing, marketers can gain greater insight into consumer behavior than ever before.
This promotes accurate forecasting and better sales. Data mining is also commonly used in market
segmentation.