• Reinald Nathaniel

The Importance of Data in Digital Marketing

Updated: Mar 14, 2019

As someone who loves #digitalmarketing, I want to share with you business owners or those with the hunger to learn, the first principle in digital marketing world.

We are not going to talk about details on how to run advertisement at first, but the right mindset of digital marketing in your business. A lot of people know how important it is to be healthy, but some of you might read this article while eating junk food. We know what to do, but we don't do it because we are not convicted.

Today, I will introduce you with the world of trend and the importance of data.


The Trends

I still remember clearly, back in my university year it was about in 2010, coffee was not that popular. When you're looking for a place to do your assignments, you would not go into a coffee shop slash working space to be productive. But nowadays, the norms stated that your productivity might increase if you are in that kind of atmosphere.

According to Google Trends, coffee is still one of the most wanted search phrases in the world of millennials in Indonesia. it has been stable for the past one year, hanging at more than 95 points at the moment. According to Google Trends explanation: 

"A value of 100 is the peak popularity for the term. A value of 50 means that the term is half as popular. A score of 0 means there was not enough data for this term."


If you're curious to see the latest trends of coffee for the past 12 months, you can take a look at this amazing data. You might see some coffee shop rising through the rank, making a big fortune out of this opportunity. You started to wonder, how could I did it while the trend lasts. 


Shining in a Saturated Market

So, if you're a coffee shop owner or work in this precise industry, you might say that this is your time to shine right? Despite seeing the high competitiveness in the market, people try to dive in, looking for opportunity to shine. In this saturated market, how do you exactly shine? The first step that we can do is to analyze the trend. Not only based on your intuition but based on data.

A good start up make decisions based on data, not some rumors that spread through your employees kitchen nor some gossip floating around at your space. Data, combined with good analysis will provide you with solid information that helps you to make a strong foundation of a decision. The first step you can do is acquiring business information. It is the first step to shine in a saturated market.

Would you put your on the go product and create a lot of sales through delivery ( We know Go-Jek and Grab have consistently try to help you reach lazy consumer)

or

Would you let people stay at your coffee place hours by hours knowing that one table could only generate under than 50,000 IDR in an hour because on average, people would spend 2 hours at your coffee shop with one drink ordered.

If your scenario was the second option, what will you do? What kind of promotion should you do? Have you done the right thing to raise the revenue generated from this single table with 4 people capacity? 


Let's Learn from Starbucks Indonesia

Your answer should be based on data. There is no right or wrong answer, because as you can see Starbucks Indonesia have recently opened up stores near universities and schools. They are aware of the trend that people use coffee shop for a lot of purpose. Not everyone enjoy the coffee, they are buying the trends. That's why even 7th graders would come to Starbucks store to enjoy Frappuccino ! If you're staying at Starbucks store for hours, some of the employee would ask you politely whether you want to order again or not. This is like a friendly reminder that you've sat there for hours and you might be tired and need some liquid going through your throat. Of course they are not giving the gestures that you should order more, right?

The approach that Starbucks Indonesia has taken is quite aggressive. They wanted to create loyal customers. That is why Starbuck stores should be visible in a lot of area. Starbucks Indonesia know exactly that university students and millennials need a good place with good internet connection just to talk or to do assignments and meeting prospective business partners. Hey, come to Starbucks they say. It associates with high prestigious venue, so, why not.



Starbucks aggressive expansion associates with its strategy "your third place between home and work". For students, assignments are work. For it to be between your home and work, access to Starbucks Indonesia are important. More stores should be opened.

The use of Starbuck card also serves as loyalty system. Wherever you're in Indonesia, you can use the Starbucks card and enjoy good reward after several purchase. Notice that it takes you 100,000 IDR to refill the card. Starbucks receives their benefit as soon as you refill the card. You have paid them, but you haven't purchased any of their products. In a cash flow term, that is a good way for Starbucks. It is a win-win solution for both customers and the company in some sense. For consumers, you like to get the free drinks and all the other benefits. But for Starbucks Indonesia, you gave them money first. You paid 100,000 IDR a day while you only purchase 25,000 IDR worth of black coffee. For them, it is 100,000 to their pocket straight.



Starbucks Card shows loyalty and a lot of benefits for its customer. It is a win-win solution for both sides as the company benefit as well as they receive the money first before the later purchase.

Starbucks Indonesia  has changed from a coffee shop at malls, entering the lifestyle market in Indonesia. They have seen the trends of coffee and shine through the saturation. Now, you want to be able to shine and seizing the opportunity like Starbucks. The question is how? How do I obtain the data, just like Starbucks did and make the best out of it.

Market Research is the answer. Before you create certain marketing mix or activities, make sure that you the research. It will help you to be more effective and efficient. Behind the scene, they have created a lot of research and execute new branding strategy based on the data.


"Starbucks Indonesia customer is not price sensitive and high consumerism, this is an opportunity in expanding their business. Starbucks see the opportunity in changing Indonesia citizen to consume healthy coffee and make it as part of their life. Other than that, there are high economy growth and market growth, especially in urban areas. The democratic economy policies make it easier for Starbucks to expand their business in Indonesia."

Sources: UKEssays. November 2013. The Analysis Of Starbucks Indonesia Marketing Essay. [online]. Available from: https://www.ukessays.com/essays/marketing/the-analysis-of-starbucks-indonesia-marketing-essay.php?vref=1 [Accessed 6 September 2018].

That is an example of marketing research done by Starbucks. Through the research, they have found that the customer is not price sensitive and high in consumerism. That is one of the segment Starbucks Indonesia is aiming.


Practical Things

We know that Starbucks Indonesia is a big company. How do small companies could do the research?

Here are some tips on how you could obtain the data:


1. Ask your customers

We live in a transparency era. People love seeing open kitchen, people love seeing the weakness of their leader. Why? Because we associate with their feelings. In this world, transparency resonates with trust. When we involve our customers to be a part of our business journey, they will participate. Just make sure to reward them to appeal more. You can try using Google Forms. It is easy and take less than 5 minutes, depending on the questions you have designed. Make sure you take notes of your participants and reward them! Constant feedback is important.


2. Hire someone who is good at data gathering 

If you're not familiar or you don't have enough time to do the research, ask someone who knows how to do so. It might cost you a lot at first, but it will cost you more compared to wrong decisions in the future. Click here if you need help in data gathering. You can get in touch with me and refer to some 


3. Make sure your data is analyzed.

Data without interpretation is like having the ingredients, unprocessed, laying around. Therefore you have to analyze the data. Gather your team and make sure you listen to their opinion as well. Let them grow together and take part, they might help with your blind spot.

Having consultant to help your business grow is a good way as well. However, most of them comes at high price. Get someone you trust and talk with them, you might get insight when you tell them what has happened and make sure that it is aligned with the data you have gathered.

Another way, you can try to analyze them by yourself. Excel is the basic of data processing. You can read this article to find this basic way of analyzing data.


Closing

Trend is important for you and your company. Reading trends is one of the way for you to do market research. By doing so, you're making decision based on data, not only your instinct or intuition. Don't forget, always ask your customer and gather the information provided by them. After all, you want to analyze the data as well.

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