Predictive analytics is a form of advanced analytics that applies new and historical data to predict consumer activity, behavior, and trends using artificial intelligence. This is an integral incentive for compiling data: discovering the behavior patterns of new, repeat, and potential customers and leading them toward profitable conversions. Predictive analytics has changed the way advertisers serve ads, increasing content personalization levels and optimizing granular audience targeting.
Knowing your customer
By applying data to forecast future actions rather than to record past behaviors, you can customize a path for each type of customer and direct them to a product they feel represents their needs, wants, and values.
Customer segmentation, the process of dividing customers into groups, is an essential attribute in predictive analytics to understand the purchasing behavior of multiple customer personas. With the rise of big data and algorithmic modeling, predictive analytics can help marketing agencies and internal decision-makers understand their audiences and fill gaps in their data.
Here are a few tips to consider when investing time understanding your audience and their journeys:
- Observe your customers’ purchasing history or interactions to gather what types of products they find valuable and how they engage with your brand. When this information is gathered, you can lead customers towards deals, products, and services that you’ve predicted they will find interest in.
- Collect characteristics of returning customers to compare with potential or new customers. Through this collection, you will understand the basic attributes of loyal customers, thus maneuvering your marketing efforts towards targeting new customers’ who may prove to show more loyalty traits than others.
- Supervise the churn rate of customers, or customers who discontinue the subscription, product, or service in a given time period. In discovering the churn rate through data, a marketing team can identify pain points and brainstorm innovative ways to increase retention and spend more efficiently.
Predictive analytics & Ga4
Google is one of the main drivers behind the shifted focus to predictive analytics. They’ve left behind many of the traditional methods of segmentation and audience building, opting instead for machine learning and algorithmic practices. Google is implementing new predictive metrics for marketers to leverage to know their customers even better. When migrating from UA to GA4, look out for these cutting-edge predictive capabilities:
Purchase Probability– this is the probability that a customer will take a conversion action in the next 7 days
Churn Probability- this is the probability that a customer who was active on your website in the last 7 days will not be active on your website within the next 7 days
Revenue Prediction– this is the predicted revenue for the next 28 days from all of the customers who have visited your website in the last 28 days
Predictive Audiences– you can create predictive audiences in the audience builder section of GA4. Predictive audiences will “ automatically determine which customer actions on your app or site might lead to a purchase—helping you find more people who are likely to convert at scale.”
benefits of predictive analytics
Predictive Analytics offers a wide variety of benefits for marketers who want to better leverage their existing data. Some of these include
- Better Performance
- More Personalized Content
- Get More High-quality Leads
- More Efficient Marketing Spending
- More Precise Customer Lifetime Value
work with us
While Predictive Analytics is a key facet to understand for a successful marketing strategy implementation, it can be difficult for small companies without extensive analytics expertise to leverage these new functionalities in tandem with existing marketing practices. If you are new to analytics or want to prioritize data-driven decision-making within your organization, consider hiring a marketing agency that specializes in predictive analytics.
Fahrenheit Marketing employs some of the brightest analysts in the game. We utilize Google Analytics and its machine learning algorithms to identify underperforming segments and new opportunities for growth. We deliver measurable results for your business. Fahrenheit Marketing is a digital marketing agency in Austin, TX that prides itself on a client-first mentality. Want to see some of our exceptional work? Check out our portfolio.