“Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Joe Hirsch, CEO at YellowHammer Media Group.
There are two times each year when brands’ advertising strategies are scrutinized by the general public: the Super Bowl and the kickoff of the Christmas shopping season – formerly known as Black Friday and, more recently, Cyber Monday.
While Super Bowl commercials are all about the brand, Cyber Monday campaigns are all about the deal. Q4 2015 saw more than an 18% increase (PDF) from Q3 in spending on digital ads, a channel many brands turn to when performance is the name of the game.
But is digital working for brands during the holidays? Amazon accounted for more than one-third of all online sales during Cyber Monday last year. Brands may salivate over Amazon’s sales wizardry, but it’s the company’s unique approach to advertising that helps get their sales numbers sky-high.
During the holiday season in particular, advertisers often try to wedge a traditional advertising campaign into a targeted, performance-based slot, but it doesn’t always connect with consumers. To compete with Amazon, advertisers must focus on targeting real people based on real behaviors, prioritize performance goals over other metrics and embrace more dynamic creative strategies.
Last week, the IAB unveiled an initiative to create standards for dynamic creative for programmatic advertising. The fact that we are only getting to this element of digital advertising now shows how important and intertwined targeted advertising and dynamic creative should be, but they often aren’t due to rigid logistical issues.
Marketers’ creative agencies are usually completely decoupled from their media buying agencies. The creative brief is poured into some expensive creative assets with few variants. Compare this approach with Amazon, where nearly every targeted message suggests specific products and prices based directly on very recent behavior. Even this somewhat standard version of creative optimization works really well.
What’s more, with an inflexible lump of creative assets, advertisers stop the creative agency from participating in a virtuous cycle of testing, learning and optimizing. Creative optimization is not just about relying on an algorithm to cycle through a catalog of images and taglines. Well-designed creative still works better than bad creative, especially when it’s targeted.
While some people might respond to sales prices, others might require a softer sell, highlighting the fact that a product is organic or very durable, for example. The organic creative likely needs a different look and feel than the durable creative. Companies like Etsy and One Kings Lane create beautiful creative that stays true to consumers’ taste – be it for modern furniture or kids’ crafts – as well as their past shopping behaviors.
To get the most out of dynamic creative, advertisers need to target consumers as granularly as possible. Amazon uses its own real-time search and purchase data to target its campaigns. Most advertisers are still stuck with demographic-centered briefs to determine who sees what message.
But this strategy is hopeless on Cyber Monday. Come holiday season, old ladies are suddenly buying skateboards and young men are buying purple cardigan sweaters. People break out of their normal habits to purchase gifts for other people, something for which Amazon’s real-time shopper data strategy works wonders. Recent unique shopper data can also make sure that once that grandmother buys her grandson a skateboard, she’s no longer stalked by outdated creative.
A more targeted approach will also help advertisers avoid wasted advertising spend. When they focus on targeting purchase and search behaviors, advertisers can ensure that they’re targeting real people. This is why Amazon’s own branded advertising network is so popular with its vendor partners – they know they’re getting their ads in front of real people. A focus on recent shopper and search data also allows advertisers to turn down unrealistic conditional quality metrics like 100% viewability goals, which can work against performance-based goals.
I am willing to bet that Amazon judges quality based almost exclusively on conversion metrics. Q4 is a good time for brands to review the complex quality metrics that govern today’s campaigns. Quality is extremely important, but it’s much more effective to enact a white list and a minimum viewability threshold, and then concentrate on optimizing to performance goals.
Only a creative team that’s involved in analyzing performance can produce high quality new assets quickly to take advantage of learning what works in real time. While digital media has long been called the domain of the Math Men, data will always only be half of the story. A targeted campaign with solid metrics won’t succeed if no one pays attention to the ads.
Using data to produce relevant ad creative is a great start. Adding a touch of well-considered design to boost the appeal is even better.