PART 2 – Using Data-Centric Insights to Drive Effective Media Strategy
This is the second white paper in a two-part series exploring how big data is revolutionizing digital marketing. PART 1 – Getting from Data to Actionable Insight explained the data challenge and the promise it offered but with a focus on how to create a data-driven culture that leverages analysis to deliver actionable insights. This second part examines how business can successfully leverage the insights gained from their data-centric analysis to power and optimize media operations and deliver greater ROI.
Why read this paper?
Big data is big business these days. Research firm IDC forecasts that big data services and technology will grow at a 27% compound annual growth rate (CAGR) to $32.4 billion through 2017 – about six times the growth rate of the overall information and communication technology market. And the performance improvements, increased revenue, and operational savings promised by effectively leveraging big data are expected to dwarf that number. As companies scramble to implement big data strategies, marketing has been one business function where the potential benefits of increased efficiency loom particularly large. And much is at stake here. Industry experts like eMarketer and Forrester predict global spending on digital adverting will grow about 15% annually and top $200 billion in the next five years. Achieving even a small increase in efficiency could therefore deliver huge ROI.
But most organizations will require more than tools and technology to succeed. Many lack a data-centric culture and struggle to attract and retain talent with the deep analytical skills needed. And beyond mere talent, companies will need to change operational procedures and structure workflows and procedures to optimize the use of data-driven insights.
Actions Speak Louder Than Words
Abu Bakr, an advisor to the Prophet Mohammed, is said to have observed that action without knowledge is useless but, likewise, knowledge that is not acted upon is futile. Hence, simply knowing who your best customers are without having the ability to find and reach them is of little value to business.
Moreover, the crowded, noisy and hectic world we live in requires advertisers to go to great lengths to be able to break through the clutter and effectively deliver our message where our consumers work, live and play. More often than not, this requires us to deliver our message effectively numerous times, using multiple formats, media and channels in order for it to get delivered, noticed, and make an impact.
For a high-consideration purchase in today’s world it is not unreasonable to expect over a dozen interactions to take place between a brand and a consumer contemplating a purchase. As prospective customers move from awareness to consideration, purchase, and loyalty, there are countless opportunities for marketers to influence their path along the journey to a purchase decision – provided we can reach them at key inflection points. Just knowing who our customers and prospects are is valuable, no doubt. But knowing where they are when, how to reach them, and having the means to effectively do so with a well-timed and targeted message, is the decisive advantage.
Consumers form impressions of brands on the basis of their daily interactions across countless touch points, including advertisements, news reports, social media, and conversations with friends. It can be tempting to think that, unless consumers are actively shopping, much of that exposure is wasted. Research tells us this is not the case though. Occasionally, something triggers the impulse to buy and at this point all those accumulated impressions are crucial in shaping the initial consideration set and determine the sub-set of brands consumers regard at the outset as potential purchasing options.
This research confirms the importance of two distinct aspects: a brands ability to reach consumers when and where it counts across multiple channels, media and touch points; and a brands ability to accurately track and measure which interactions were most effective in converting their interest to actions so that they can invest more into efforts that appear to have the greatest impact. The first aspect is all about targeting, message development and delivery. The second is about data, insightful analysis, and accurate attribution. We will explore both in turn below.
Reach, Channels, Media and Frequency
Today’s marketer works in an infinitely more complex world than his or her counterparts of a generation – or even just a decade – ago. Instead of a simple media mix consisting mainly of print, broadcast and out-of-home media, the modern marketer has to consider channels and media that include online display ads, earned media, mobile applications, e-mail, social, paid search and more. Moreover, none of these exist in a vacuum and research has shown time and again that they are closely interrelated and can offer powerful synergy effects that marketers can tap into and leverage. For instance, targeted display media campaigns that are coordinated with efforts across other channels and media – social media, paid search, or effective PR, for example – deliver measurably better performance than when conducted on their own.
It is therefore important that brands effectively coordinate and track integrated campaigns across multiple channels and media, thereby creating as many brand interactions as possible along the path to purchase. And most marketers are able to fulfill this requirement and reach their target audience to deliver their brand message in a multitude of ways, either by internal resources or with the help of outside agency partners. But reach is just one part of an effective campaign. Coordination, timing, analysis, and effective attribution are all crucial components needed to truly optimize cross-channel media performance.
Unfortunately, too many marketers, including many large global brands, still lack an integrated platform able to effectively coordinate cross-channels efforts, collect the relevant data each interaction generates, and analyze it to accurately track and identify the efforts delivering the most impact. This shortcoming has many, often interrelated causes, including the use of multiple agency partners for what are deemed to be separate initiatives; the general difficulty in coordinating campaigns and tracking results across display, search and social media; and the lack of an integrated marketing platform with effective cross-channel metrics & analytics capability needed to support sophisticated attribution modeling. This inability to track efforts and accurately measure performance often results in brands doing the best they can, which more often than not means spray-and-pray media buys and crude last-touch attribution. This can lead to significant misallocation of marketing spend, since it completely disregards the value of the supporting interactions that preceded that fateful one that ultimately triggered the conversion event.
Sun Tzu observed that ‘strategy without tactics is the slowest route to victory” and his sage words apply equally to the challenges faced by todays digital marketer. For even the best audience segmentation and targeting efforts are rendered useless without the ability to target and deliver the brand’s message to the target audience at the right time and place via the needed channel. Likewise, he observed, “Tactics without strategy is the noise before defeat”. Brand impressions delivered to the wrong audience, at the wrong time, or via an ineffective channel are destined to miss the mark and will fail to have an impact, resulting in waste.
A Comprehensive Analytics Platform is Critical
Many companies offer solutions to help advertisers and publishers reach larger audiences. But, as with most things in life, it’s not always about size. Bigger is not always better. And, when it comes to digital advertising, it can actually be worse. And certainly a lot more expensive. If your audience analysis, selection, and targeting are done right, less can result in more: more clicks, more traffic, more engagement, and more sales. And less wasted effort, ineffective media buys, lost impressions, missed sales.
Your goal should not be to reach the biggest audience but, instead, the best one possible and, ideally, at the lowest cost. The audience that meets your target criteria and aligns best with the profile of your shoppers and buyers. The audience that engages, converts, and delivers revenue.
Accomplishing this will require you to:
Verify Audience – ensure all your purchased impressions are delivered and viewed by your target audience, not bots or click-farms.
Analyze Attribution – develop insights about the elements in your campaign that are actually driving conversion and ensure you understand the entire path.
Optimize the Campaign – do more of what works, less of what doesn’t. This may take some experimentation to get right, so continuously review the results and take appropriate steps to maximize effectiveness and optimize overall Return on Advertising Spend (ROAS).
From Data To Insight, Effective Action to Results
Finally, even with access to good data, rigorous analysis and timely, accurate insight, brands and their agencies still lack one vital component crucial to success: decisive – and timely – action. It’s no secret that the pace of our frantic, always-on world has accelerated and continues to do so. With the rise of social media, news spreads in near real-time and perceptions, attitudes and trends can turn on moment’s notice. Marketers need to be in tune with this, especially if their target audience includes millennials or other highly connected groups.
Brands and their agency partners must be plugged into current events, trending topics and the effect they can have on our cultural mood and Zeitgeist. While large campaigns will still need to be planned ahead to afford for effective coordination, they must be monitored constantly and designed with enough flexibility to be nimble and responsive, able to shift as needed. To do so, campaign managers need access to real-time performance data in a format that will allow them to tap into trending events and cultural phenomena and shift media spend quickly to capture the wave of interest and capitalize on it.
If Twitter is abuzz about Michelle Obama’s dress, then that’s a great opportunity to run ads showing your brand’s similar design, available at a fraction of what that Carolina Herrera number cost the taxpayer. If Pinterest is blowing up over Beyoncé‘s Alexander McQueen boots, it could be a good time to show how similar your line is, available to anyone online, at far more reasonable cost. Or, if the world is reeling from the heartache and agony of a deadly plane crash, it might be wise to pull your ads centered on air travel and replace them with the version that showcase the great American road trip.
Monitoring campaigns while in-flight, using real-time data, and optimizing them multiple times a day by reallocating spend and changing messaging, can enhance performance and dramatically lift effectiveness to deliver improved results measured where they matter most: the bottom line.