Realizing the Promise of One-to-One Marketing

The Review April 2016
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By Tim Prunk, Executive Vice President of the Global Marketing Group at Epsilon

Gone are the simple days when marketers sent their messages via direct mail, phone and catalogue and then waited for the responses to come in. Now the digital marketing challenge is to know, connect and cultivate individual relationships, at scale, across all devices and channels, in real time, with surgical precision. The internet has been both a blessing and a curse as many brands still haven’t fully conquered personalized marketing or even grasped the enormous transition from quarterly push-messaging campaigns to true 1:1 people-based marketing.

The promise of the internet, with the ability to do 1:1 marketing delivered in real time with negligible costs (compared to traditional channels) has proven to be a real challenge. Disappointing digital campaign results, fragmented channels and fickle consumers with little to no brand loyalty have changed the marketing paradigm in ways no one could have imagined. The consumer is now in charge of the marketing process. They determine what information they want, how they will get it and from whom. Marketing is now much more about knowing the customer, learning how to engage with them and providing relevant content to each individual, assuring a consistent experience at every touch.

Many marketers understand the task, but getting it done is a whole different story. I believe there are a number of reasons for the current digital challenges and there are some fundamental shifts that will allow smart marketers to turn these challenges into opportunities.

What We Mean When We Say 1:1 Marketing at Scale

“Personalization” may be our industry’s most misused, and overused, word. It has come to mean everything that’s even remotely targeted or customized, often leaving marketers disappointed by the results of inaccurate, ineffective “personalization solutions.” What marketers are really hoping for is one-to-one marketing at scale. This is far more specific and far more challenging to achieve. One-to-one marketing at scale is recognizing, reaching and staying connected to a sizable number of individuals who you know a lot about through meaningful, ongoing conversations, in real time, and then being able to learn and optimize as you go.

The Problem with Today’s Digital Marketing

One of the most significant issues facing digital marketers today is ad quality*. When an advertiser buys media in a digital environment they expect to have real people viewing their message, not bots; that the media appears in appropriate, brand safe content; and that impressions are viewable. Precision, identifying consumers and truly knowing them at the individual level in the digital ecosystem is unnecessarily difficult

A 2013 comScore study across hundreds of campaigns and billions of impressions found that more than half of digital display impressions were non-viewable. While the study is three years old, ongoing tracking of this issue indicates the ratio of viewable to non-viewable inventory is similar today.

Marketers can play a part in ensuring ad quality by selecting partners who are using advanced tools to detect and eliminate ad quality issues. These tools allow for the identification of real consumers, not suspected bots, site screening prior to network integration and constant monitoring for best practices and privacy standards updates

Another issue is with cookies. Over time as more and more digital channels have been added, scale has increased dramatically and cost has declined, but precision has diminished as well, because marketers are forced to rely more on cookies and perishable data. With the average consumer having 3.4 devices, 19 cookies and over three email accounts, it’s not surprising that it has become increasingly difficult to recognize and deliver the right message to the right consumer. If you are relying on cookies to target your digital messages, you are treating every cookie as a different person and unknowingly bombarding the same person over and over again with the same message.

Digital marketers must also beware of probabilistic methods for cross-device matching. This approach is essentially a scientific guesstimate. With the challenges of recognizing individuals, particularly on their mobile devices, or targeting large audiences that match your desired audience, many brands are erroneously messaging the wrong people – or worse no one – in the belief they are reaching real people that look like their targeted individuals. The assumption brands are making is that if they use only verified matches and data, they can’t attain the desired scale (which is no longer the case). As a result, they may be reaching their desired audience less than 20% of the time.

Who do you trust?

The ecosystem of solutions providers is daunting with countless partners to help identify and reach consumers. Finding the credible vendors and integrating niche providers in a holistic approach can consume you. There are agencies, vendors, consultants, SaaS providers, social media giants and dozens of others, making up the most complex set of competitors I’ve seen in my career.

So, what is a marketer to do?

The modern day marketer’s goal should be to strike the perfect balance of precision and scale, mastering one-to-one connections, marketing to real people, all while balancing personalization and consumer privacy expectations.

Despite all of this chaos, the same two basic but crucial marketing principles we relied on decades ago still apply for effective, relevant digital campaigns. Focus on deep consumer understanding and the ability to connect brands to people in meaningful ways.

In the book, “Igniting Customer Connections”, by Andy Frawley, CEO of Epsilon, he shows how major brands have fundamentally changed the performance of their marketing by simultaneously focusing their strategies on improving how customers engage with their brand and how they experience the brand. They’re proactively allocating marketing strategies and dollars to improve engagement and experience, and dramatically improving business outcomes such as sales, share of wallet and brand equity.

Megabrands like the NFL, Marriott and FedEx are now able to provide intimate customer service and personalization by having a robust, centralized database of customers that is updated, accessed and actioned upon in real time. Thanks to marketing technology, this is no longer a daunting task of data entry into a CRM system. Instead, these databases ingest and house rich customer information and insights including behavioral data such as digital engagement, past purchase information and media and social interactions, all within a privacy safe framework. Additional data including preferences, propensities and detailed demographics fill out a robust customer view.

These brands are learning how to use these data to drive their segmented, and in some cases, individual level engagement, to better understand, not only who is buying, but what they are buying and how, as well as why they are buying, when and where to reach them and how to win their business. This enables brands to uncover and create loyal customers and advocates.

It’s crucial to have a strong understanding of your current and potential customers, whether you work at one of the world’s biggest brands or at a corner boutique. While a small store may recognize their customers’ faces, mentally record past purchases and take the time to physically wave in repeat visitors as they pass by, these actions are now possible on a much larger, global scale via a myriad of devices and channels.

Connecting Brands to People across All Channels

Through marketing automation and personalization, it’s now possible to optimize communications throughout the customer journey across all channels, relying on the foundation of data. By first understanding who your customers are and what motivates them to click, like, research, purchase or recommend a product, you can then communicate effectively with them in the atomic moments, those critical points in time that matter, and through the optimal channels to create deep emotional connections.

Marketers need to have the right messaging at every touch during each person’s buying journey, and understand how consumers use every channel to research and make purchases. With progressive learning about each customer, you can recognize when a customer is entering a new life stage that could trigger different types of behaviors or reactivate lapsed customers.

Marketers also need think about driving customer loyalty and engagement after a purchase with valued offers based upon customer understanding, and by ceasing communications at times. This means we can finally do away with the creepy display ads. You know the ones I’m talking about. You buy a new pair of running shoes yet they continue to follow you around on the web and on social media for days and even weeks. As an industry, we’re better than that and the capability is in place to stop selling a product that was just bought and instead to offer what is complimentary to a recent purchase.

As consumers spend over five hours per day on digital channels and as they increase usage of smartphones to shop online as well as for in-store price comparison, the advertising industry needs to remain focused on how to best reach them with a personalized experience. Personalized marketing is only possible if you can recognize, reach and stay connected (at scale) to real people, effectively messaging to them in a meaningful, ongoing and real-time manner across the optimal channels and devices, in the moments that matter.

The ability to truly do real personalized marketing is no longer limited by technology. It’s limited only by the marketer’s imagination.

Tim Prunk is Executive Vice President of the Global Marketing Group at Epsilon, a global leader in creating connections between people and brands. Recognized by Ad Age as the #1 World CRM/Direct Marketing Network. #1 U.S. Digital-Agency Network and #1 U.S. Agency from All Disciplines, Epsilon employs over 7,000 associates in 70 offices worldwide. For more information, visit www.epsilon.com, follow the company on Twitter @EpsilonMktg or call 1.800.309.0505.

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