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    How to Use Customer Data to Fuel Marketing

    Aug. 13, 2021
    Most contractors know their customers are valuable marketing resources. Ratings, reviews, and testimonials are powerful marketing tools. But recent data privacy regulations and changes to advertising platforms has made customers even more valuable.

    Why is Consumer Data Important for Contractors?

    Most contracting businesses operate on a lead-generation sales model. Some companies have been able to generate leads with a positive return on ad spend through digital campaigns on platforms like Google and Facebook. For example, a user searches for “hvac companies near me” or “air conditioning specialists,” clicks on an ad targeted at those keywords, then calls to schedule an estimate. 

    However, some of these digital campaigns may be at risk. Data privacy and how personal information is used by corporations and advertisers has been a hot-button issue for consumers and governments since the Facebook-Cambridge Analytica scandal in 2016.  Since then, there has been major data privacy legislation enacted in the European Union (GDPR) as well as California (CCPA) aimed to regulate how businesses manage consumer data.

    With more regulations likely to be enacted in the near future, major players in the tech industry have changed their advertising capabilities. Apple introduced their iOS 14.5 update which impacted the ability to measure demographic data (age, gender, geography) of website conversions driven from Facebook ad campaigns. Google has recently delayed their plan to block third-party cookies until 2023.

    How Should Contractor Marketing Strategies Change?

    Some may look at Google’s plan to delay blocking third-party cookies as a short-term opportunity to harvest as much from the existing advertising model as possible. But this should not be at the expense of the bigger picture. Contractors who rely on running lead generation campaigns on Facebook or Google should consider their 2-5 year strategy and plan for a smooth transition. The risk would be a sharp decline in new business in 2022 and 2023.

    One way to reduce the risk of a decline in new business and maintain campaign performance is to collect and activate audience data straight from the source—the customers themselves.

    One way to reduce this risk and maintain campaign performance is to collect and activate audience data straight from the source—the customers themselves.

    First-party data is any information you collect directly from your audience. It’s stored and managed within an owned database, like a website analytics tool or customer relationship management (CRM) platform. It can be a powerful way to strengthen marketing activities.

    How Can Contractors Use Customer Data to Fuel Marketing?

    Contractors will need to adjust marketing strategies and tactics to maximize the marketing value of their audience. They will need to coordinate with in-house or agency teams to make a number of changes. Here are a few ways contractors can collect and activate customer data to fuel their marketing:

    ●  Cookie consent management. First, manage how you’re using cookies on your own site. Allow visitors to express what they are and are not ok with sharing. Since many U.S.-based privacy rules are dependent on opting out of info sharing, you’ll want to give visitors the opportunity to opt out of tracking as they navigate your website.

    ●  Conduct audience research. Surveying your audience is a great way to inform the direction of digital strategy and gather meaningful data quickly from your audience. For example, asking customers about their biggest pain points can help craft marketing messages for campaigns.

    Asking customers about their biggest pain points can help craft marketing messages for campaigns.

    ●  Examine the marketing value exchange. Customers are beginning to realize how valuable their personal data can be. This means contractors need to get creative about how they collect personal identifiable information, like an email address. For example, contractors may consider offering a discount on installation fees for customers who fill out a survey or subscribe to their email newsletter. 

    ●  Analyze creative performance. With fewer targeting capabilities on the horizon for ad platforms, contractors should begin systematically testing and analyzing the performance of creative variables, like photography vs animation, or method of storytelling. Feedback loops between paid media and creative teams will be critical to make this a reality. 

    ●  Lean into machine learning. Without the ability to target specific audience segments through third-party cookies, marketers may consider taking advantage of creating “lookalike audiences” on advertising platforms like Facebook and Google by uploading customer email lists to each platform. This helps AI and machine learning algorithms identify other users who may share similar behavioral characteristics, broadening the reach of your advertisements.

    ●  Expand email marketing. With more complete customer profiles, contractors can personalize email messages or segment their lists in new ways. For example, if you service a broad geographic region and have zip codes of your audience, you can segment your email communications by geography to make your message more personable.

    How Can Contractors Start Adjusting Their Digital Strategy? 

    Contractors should talk with their in-house marketing team or agency about what makes sense for their business. Your business may be in a good position already, or you may have a long road ahead for a seamless transition to a privacy-centric marketing environment. In any case, now is the time to understand the level of effort required to set your contracting business up for success in 2022, 2023 and beyond.

    John Tyreman is a seasoned marketer with experience conducting market research focused on buyer behavior. John has appeared on webinars, podcasts, and authored hundreds of blog articles. Connect with him on LinkedIn.