The Five Principles Of Modern Marketing

Managing the Data" is a column about customer and audience data strategy written by longtime AdExchanger contributor Chris O'Hara.

Every marketer and media company these days is trying to unlock the secret to personalization. Everyone wants to be the next Amazon, anticipating customer wants and desires and delivering real-time customization.

Actually, everyone might need to be an Amazon going forward; Harris Interactive and others tell us that getting customer experience wrong means up to 80% of customers will leave your brand and try another – and it takes seven times more money to reacquire that customer than it did initially.

How important is personalization? In a recent study, 75% marketers of marketers said that there’s no such thing as too much personalization for different audiences, and 94% know that delivering personalized content is important to reaching their audiences.

People want and expect personalization and convenience today, and brands and publishers that cannot deliver it will suffer similar fates. However, beyond advanced technology, what do you need to believe to make this transformation happen? What are the core principles a company needs to adhere to, in order to have a shot at transforming themselves into customer-centric enterprises?

Here are five:

Put People First

It’s a rusty old saw but, like any cliché, it’s fundamentally true. For years, we have taken a very channel-specific view of engagement, thinking in terms of mobile, display, social and video. But those are channels, apps and browsers. Browsers don’t buy anything; people do.

A people-centric viewpoint is critical to being a modern marketer. True people-based marketing needs to extend beyond advertising and start to include things like sales, service and ecommerce interactions – every touchpoint people have with brands.

People – customers and consumers – must reside at the center of everything, and the systems of engagement we use to touch them must be tertiary. This makes the challenges of identity resolution the new basis of competition going forward.

Collect Everything, Measure Everything

A true commitment to personalized marketing means that you have to understand people. For many years, we have assigned outsized importance to small scraps of digital exhaust such as clicks, views and likes as signals of brand engagement and intent. Mostly, they’ve lived in isolation, never informing a holistic view of people and their wants and desires.

Now we can collect more of this data and do so in real time. Modern enterprises need to become more obsessive about valuing data. Every scrap of data becomes a small stitch in a rich tapestry that forms a view of the customer.

We laughed at the “data is the new oil” hyperbole a few years back – simply because nobody had a way to store and extract real value from the sea of digital ephemera. Today is vastly different because we have both the technology and processes to ingest signals at scale – and use artificial intelligence to refine them into gold. Businesses that let valuable data fall to the floor without measuring them might already be dead, but they just don’t know it yet.

Be A Retailer

A lot of brands aren’t as lucky as popular hotel booking sites. To book a room, you need to sign up with your email. Once you become a user, the company collects data on where you like to go, how often you travel, how much you pay for a room and even what kind of mattress you prefer. Any brand would kill for that kind of one-to-one relationship with a customer.

Global CPG brands touch billions of lives every day, yet often have to pay other companies to learn how their marketing spend affected sales efforts. Brands must start to own customer relationships and create one-to-one experiences with buyers. We are seeing the first step with things like Dash buttons and voice ordering, though still through a partner, but we will see this extend even further as brands change their entire business models to start to own the retail relationship with people. The key pivot point will come when brands actually value people data as an asset on their balance sheets.

See The World Dynamically

The ubiquity of data has led to an explosion of microsegmentation. I know marketers and publishers that can define a potential customer to 20 individual attributes. But people can go from a “Long Island soccer mom” on Monday to an “EDM music lover” on Friday night. Today’s segmentation is very much static – and very ineffective for a dynamic world where things change all the time.

To get the “right message, right place, right time” dynamic right, we need to understand things like location, weather, time of day and context – and make those dynamic signals part of how we segment audiences. To be successful, marketers and media companies must commit to thinking of customers as the dynamic and vibrant people they are and enable the ability to collect and activate real-time data into their segmentation models.

Think Like A Technologist

Finally, to create the change described above requires a commitment to understanding technology. You can’t do “people data” without truly understanding data management technology. You can’t measure everything without technology that can parse every signal. To be a retailer, you have to give customers a reason to buy directly from you. Thinking about customers dynamically requires real-time systems of collection and activation.

But technology and the people to run it are expensive investments, often taking months and years to show ROI, and the technology changes at the velocity of Moore’s Law. It’s a big commitment to change from diaper manufacturer to marketing technologist, but we are starting to understand that it is the change required to survive an era where people are in control.

Some say that it wasn’t streaming media technology that killed Blockbuster, but the fact that people hated their onerous late fees. It was probably both of those things. Tomorrow’s Blockbusters will be the companies that cannot apply these principles of modern, personalized marketing – or do not want to make the large investments to do so.

Follow Chris O'Hara (@chrisohara) and AdExchanger (@adexchanger) on Twitter.

3 Comments

  1. Interesting points made here by Chris O'Hara, which I suppose is no surprise to those who have read his posts for awhile. This time two of his thoughts lead me to comment. First, on companies ultimately assigning value to people data on their balance sheets. That may be trickier than it appears at first glance. For starters, are there generally accepted accounting standards firms can use to assign that monetary value? It is risky for a firm to say "our people data are worth x million dollars" without a solid reason for it, if that amount is material within the financial statements. If they assign value, the data better be accurate, reflecting clean up to reflect customer churn, and other events that affect the currency and validity of that data over time. Let's face it, for most companies, keeping this ever growing pile of information current, clean and accurate is hard, and low down on the list of maintenance priorities. That means it doesn't often get done. Inaccurate data could detrimentally affect management's perceived value of the data, so we are back to nit picking accounting standards.

    Second, about the marketing management thinking like technologists. That is hard, since we think differently and from a business perspective speak different languages. So perhaps what is important here is trust, collaboration and communication. Marketing should turn to tech for the needed guidance. Tech in turn, whether in house or outside consultants, must respectfully listen to and understand the problem marketing is trying to solve, then advise on what technology can bring to bear on the problem. If the tech advisor won't listen and help, find another tech advisor. Marketing is the customer here, and owns the budget.

    Reply
  2. Great article Chris... Data IS the new oil... And marketers who don't own the relationship with their customers are cash poor in today's environment... That said, for those who do make data capture a priority, all too often we see them drowning in their big data…. the notion of capturing all the microsignals, etc. and letting the machine make sense of them has been romanticized, IMO. For all of the supposed advances made on the path to improving targeting and personalization, consumers continue to say what they said a year ago, five years ago, ten years ago -- most of what they get from marketers is irrelevant, and sent their way, way too frequently. On the business side, we're witnessing brands proclaiming that they aren't seeing growth, despite the promise of the right message, to the right person, at the right time promises made by their digital agencies and platforms. For most marketers, the focus should be on acquiring the right data - data that can be easily deciphered and used to drive clear value for the consumers they're trying to speak to.

    Reply
  3. Could not agree more. Today, we are seeing a lot of results from using data for suppression. Why spend money advertising to someone who has a ticket open with you in your service software, and currently has a product issue? Marketers can and should start with easy wins and graduate to the "collect/measure" everything dynamic over time, as their systems (and people) mature.

    Reply

Add a comment

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>