A Marketer s Guide. To Unlocking the Value of Your Customer and Prospect Lists. maxpoint.com

Transcription

1 A Marketer s Guide To Unlocking the Value of Your Customer and Prospect Lists maxpoint.com

2 2017 MaxPoint Interactive, Inc.

3 Table of Contents The Business Opportunity The Solution Components Factors to Consider Key Questions to Ask Leveraging Investment for Stronger Brand Reach Enriched Data Sets for Powerful Shopper Targeting

4 Unlocking the Value of Your Investment Businesses will invest around $36 billion in CRM systems, processes, and lists in 2017.* However, surveys from the early 2000s and even today indicate that most of these investments fail to meet their business objectives. These lists and the related data certainly represent significant opportunities for marketing efficiency, better customer experiences, and improved profitability. But the potential of customer lists has been largely unrealized so far. As brands move toward truly omnichannel marketing, demand grows for individually addressable marketing tactics across multiple channels from mobile ads and to addressable TV and direct mail. *Gartner, June MaxPoint Interactive, Inc. A MARKETER S GUIDE

5 Marketers Respond with Identity-Based Marketing Market-leading brands are moving toward omnichannel identity-based marketing. This approach leverages individually addressable marketing vehicles across multiple channels (everything from mobile ads and to addressable TV and direct mail) and customizes each marketing touchpoint based on an in-depth customer profile containing facts such as purchase history, current interests, and psychographics. Omnichannel identity-based marketing requires you to immediately recognize and respond in a relevant manner to each customer whenever and wherever they appear at a marketing touchpoint, whether that s in a physical store where your brand is sold, on your website, in an advertisable moment on a third-party website, or anywhere else both online and offline. The goal is to deliver appropriate content to each customer based on where they are in the purchase journey and to market to first-time buyers differently from heavy, longtime buyers. Your customer address lists are your most valuable asset. maxpoint.com

6 It s About Knowing Your Customers Better Due to rising consumer mobility across devices, online properties, and physical locations, merely recognizing an individual as one of your customers is no simple task. And you must not only identify the specific customer, but also have a complete and continuously updated profile of their interests and history of interactions with your brand so that you can instantly activate a customized marketing message or offer via any one of an increasing number of individually addressable marketing channels. As B2C marketers pursue contextual marketing and contend with its inherent complexity, [connecting] the dots between customer interactions is a critical success factor. Forrester Research 1 Getting More Out of Your Investment There are now a variety of technology solutions competing to manage this process of identifying, profiling, and activating customer lists. But which one is right for you? Keep in mind your main objective: not just to know your customers better, but to use that knowledge to improve brand performance, both in the customer s eyes and in your financials. Identity matching and the ability to activate 1:1 marketing are critical parts of the process, but forward-thinking marketers understand that it s about getting enriched customer profiles. They seek out new sources of data to learn more about their customers and segment them in strategic ways. They evaluate new data types based on what is most relevant for their marketing strategy, adds the most value to the customer experience, and is the greatest source of competitive advantage. Best-in-class marketers look for the freshest possible data they can get to enable as close to real-time response as possible. 82% of marketers said they plan to increase their use of first-party data this year because of the value it adds to customer understanding and engagement. Econsultancy 2 1. Forrester Research, October Econsultancy with Epsilon and Conversant, August MaxPoint Interactive, Inc. A MARKETER S GUIDE

7 Who Should Read This Guide Questions Answered by This Guide Marketers who have an existing list of customers or prospects with addresses physical or Those who seek to enhance that list with digital identities and richer customer profiles to support omnichannel contextual marketing at scale Particularly those whose targeting must be location-aware due to regulatory requirements or physical business locations How can I use enriched customer data to increase customer engagement? What are the benefits of implementing a customer identity system? What steps are necessary to enhance existing customer data with digital identities and enrich customer profiles to support a holistic, identitybased marketing approach? What are some of the key issues to consider and questions to ask when selecting an identity solution? What percentage of customers in an existing customer database can realistically be matched to digital identities and reached with marketing? How have the real-world challenges of identitybased marketing been successfully addressed? maxpoint.com

8 The Business Opportunity Today s market leaders deliver a seamless omnichannel customer experience that, in a privacy-safe way: Recognizes each customer wherever they are at the moment, in any marketing channel, on any device Profiles current interests, and other relevant variables the customer in terms of their prior brand interactions Activates contextually relevant marketing In fact, one recent study reported that the vast majority of marketers (84%) want to employ identity-based marketing strategies across all digital channels. 1 Why? To unlock the value of their CRM investment. New marketing opportunities Opening new channels of communication, enabling new methods of segmenting, and targeting your customers with more timely and pertinent messages by linking your existing customer data with new online data sources Better customer targeting Leveraging customer data for digital ad targeting, enabling you to reach specific customers across all digital channels and devices and supplementing traditional CRM tactics like direct mail and Deeper customer insights Dynamically augmenting existing profiles with data available only from digital ad platforms, including your customers online activity (e.g., site visits that indicate someone is in the market for your product) as well as physical location activity (e.g., store or dealership visits) Great foundation for the future Creating a foundation that will support emerging strategies such as data monetization and sharing, addressable TV advertising, and opportunities arising from the Internet of Things. 1. Econsultancy with Epsilon and Conversant, August Harvard Business Review, November Given the enormous opportunity to create new value, companies should pursue emotional connections as a science and a strategy. But for most, building these is more guesswork than science. Harvard Business Review MaxPoint Interactive, Inc. A MARKETER S GUIDE

9 The Solution Components Many technology platforms promise to help solve the challenges of omnichannel identity-based marketing. But how do you decide which one is right for you? Match Enrich Activate Match each of your customers by their physical and/or address with their various digital identities (device ID, IP address, cookies, etc.). One of the challenges here is the frequency with which people replace phones and acquire new devices, so matching must be continually updated. Why This Matters Matching a customer with only one or two digital IDs will leave a lot of marketing opportunities and customer value unrealized. With a comprehensive identity graph, you will be able to recognize each customer whenever and wherever they go, across all devices and marketing channels, both online (retailer websites, , advertising opportunities) and offline (in-store and direct mail). Link each customer identity with an enriched profile that includes the data you already collect such as their history of interactions with your business, both online and offline along with third-party data on the customer s real-time location, interests, purchase intent indicators, and other contextual factors. The real challenge here is appending the latest customer activity instantly, as it happens. Why This Matters By enhancing customer profiles with current interests as revealed by their most recent online activities and site visits (not merely search terms), you will be better able to anticipate consumer needs and where they are in the purchase journey. Export the now-enhanced customer data to activate your marketing (display ads, social media, , direct mail) that reaches individual customers with relevant messages at each stage of the purchase journey. To stay current with your customers, you ll also need a process to continually feed data updates to your marketing activation partners. Why This Matters You will be able to: Target addressable advertising (display, mobile, video, TV) to specific customers and customer segments based on their brand interaction and purchase history as captured in your CRM system Target direct mail or to customer segments based on their online activity maxpoint.com

10 More opportunities to engage with your best customers Deeper customer engagement with your brand as well as greater customer lifetime value The ability to respond to real-time customer interests and purchase-intent cues and then deliver personalized, context-specific content to each customer 2017 MaxPoint Interactive, Inc. A MARKETER S GUIDE

11 Factors to Consider 1 In Match, You Need Scale The objective of matching your CRM list with digital identities is to expand your opportunities to more meaningfully engage with your customers across all of their devices and across all digital channels. In other words, to be able to assign digital identities to as many of your known customers as possible. LOYALTY SWEEPSTAKES NAME ADDRESS NAME ADDRESS NAME ADDRESS Vendors can match from less than 40% to well over 70%. That s a huge spread determined by how the vendor deals with identity fragmentation. When interacting with a specific brand, a customer may use different identifiers depending on location and application. The ideal is to connect each of those identities back to the individual s name, home address, and assigned customer number. NEWSLETTER SURVEY NAME ADDRESS NAME ADDRESS WHAT VARIABLES IMPACT SCALE AND MATCH RATES? Digital identities The highest match rates come from being able to resolve customers to three major types of digital identity: IP address, mobile device ID, and cookies. Most vendors only resolve to one or maybe two types of digital identifiers. Multiple devices The more devices that can be linked to a given household or individual, the better. Physical addresses The greater your vendor s knowledge of physical addresses and how to process them, the better it should be at matching your customers offline identities with online data. MATCH LIST NAME ADDRESS BUYING INTENT INTERESTS Geographic specificity If accurate geographic targeting is critical to your marketing plans, due to regulatory requirements or physical store locations, how do you ensure geographic accuracy in your customer identities? maxpoint.com

12 2 For Enrichment, You Need to Unlock Purchase Intent Once you have a list of who you can reach digitally, the next challenge is deciding what you say to them. You may have already appended a variety of targeting variables to your customer address list demographics, web interactions, past purchases, shopping preferences, product ownership or service subscription, expected repurchase or renewal date, and so on but adding even more insights can help you in several powerful ways: Interests and purchase intent A great deal of information about an individual customer s long-term interests (e.g., college football or home maintenance) and short-term purchase intent (e.g., shopping for a new car or cell phone plan) can be gleaned from online activity and attached to digital identity. Household insights Individual customer records can also be augmented with neighborhood-level data, such as income, the likelihood of homeownership, urbanicity, and even shopping preferences. Brand propensity Some variables in your customer database, such as likelihood that a given household prefers or owns a particular car brand (or owns a car at all and therefore needs car insurance) may have been predicted but not known. List enrichment can help increase that confidence level to improve targeting efficiency. Geographic precision Location enrichment can improve geographic targeting accuracy. This is of particular importance to marketers who want to drive buyers to specific store locations, service businesses that want to grow their share in specific markets, and businesses that are regulated at the state level MaxPoint Interactive, Inc. A MARKETER S GUIDE

13 3 For Activation, You Need Portability, Recency, and Scale Portability means the flexibility to export your new customer file (with digital IDs and enriched profiles) to any data integration platform, such as Adobe or Oracle Marketing Cloud, for use with any digital media provider (e.g., social media platforms, software, addressable TV networks, online publishers). Portability of your enriched customer list can be critical to realizing the vision of omnichannel contextual marketing. Leading marketers are testing various combinations of 1:1 marketing vehicles direct mail, , digital ads, and addressable TV to determine what works best for different audiences and to improve marketing ROI. Recency means that the data you re using for activation is as up-to-the-minute as possible. This applies to identities recognizing when a customer gets a new device, for example as well as profiles. When it comes to profiles, frequent or even continuous updating is necessary to know exactly when to deliver ads and offers. Scale is just as important at the activation stage as it is at the matching stage. When your enriched customer file is activated by an ad delivery platform, the technology may enable you to reach more of your targeted audiences. ENRICHED LIST NAME ADDRESS DISPLAY TV MOBILE DIRECT MAIL SOCIAL maxpoint.com

14 Key Questions to Ask When Choosing a Customer Recognition Solution Unlocking the Value of Your Customer List Process Can you match a household to multiple digital identities an IP address plus all devices used by this household, plus cookies? Data source What is your source for the digital identities used for matching? Is it both comprehensive and privacy-safe? Match rate What percentage of my customer address list can you match to a digital identity? Breathing More Marketing Life into Each Customer Record Validation of existing data Can you crosscheck your existing data with my first-party data to improve the accuracy of my data in some way? Addition of new data What new data can your append to my customer file that can significantly enhance my targeting? Can you provide weekly or even daily updates to my customers online activity, long-term interests, and near-term purchase intent indicators? Geographic accuracy If I need accurate geographic targeting due to physical business locations or stateby-state regulatory requirements, how do you ensure that my digital IDs can be parsed geographically once exported for activation? Delivering a Seamless, Personal Experience for Engagement Portability Can I export and use my newly created digital audience data to any data integration platform (e.g., Adobe, LiveRamp, Oracle)? Can I export and use my audience data with any digital media partner (e.g., Facebook, Marketo, addressable TV networks, online publishers)? Hosting Where will my enriched customer file be stored and how do I know it will be secure? Can I get instant access to it at any time to activate a segment for a particular campaign? Will I have access to the data via some kind of user interface so I can develop new knowledge about my customers and experiment with different ways to segment? Scale What percentage of my digitally identified households can you actually reach with digital ads? 2017 MaxPoint Interactive, Inc. A MARKETER S GUIDE

15 Leveraging Investment for Stronger Brand Reach Do you have a database of current customers or prospects that you d like to reach with new marketing messages or offers? Perhaps they ve been ignoring your direct mail or efforts and you want to reach them with digital ads, or maybe you just want the ability to deliver a seamless brand experience across all channels and devices. Whatever your objective, everyone is trying to figure out who their highest-value targets are, what the most relevant message/offer is for them, and how to most effectively deliver the message. Get closer to your customers, understand them better, and segment them more effectively. maxpoint.com

16 Match Many companies have acquired large name and address lists and assigned each household a propensity to purchase or customer value score, which is then used to determine which households to target with different campaigns. The challenge then becomes: how do you activate these households through any and all of the channels that suit their needs and not just via direct mail? The most common solution has been to match physical addresses to browser cookies, but since the explosion of smartphone usage, the match rate for a cookie-only approach averages just 40%. The better solution is now to use a multipronged matching approach. % % % Enrich Once you have a list of who you can reach digitally, the next challenge is deciding what you say to them. This is where data enrichment comes into play. For example, your customer database might hold contract end dates, enabling you to trigger renewal ads at appropriate times. But customers can decide to make a change at any time, so how can you discover and respond to that intent? Leading marketers look at their customers online activity for purchase intent signals, not just on their own websites but also across the entire Internet. Information on specific customers long-term interests (e.g., investing or home maintenance) as well as short-term purchase intent (e.g., shopping for a new car or cell phone plan) can be gathered across all of their devices, dynamically appended to your customer database, and used to target marketing. Imagine knowing that one of your current subscribers has been researching alternatives in the past week, and you can now to trigger timely retention marketing efforts to them. It s already being done. Activate After using a multipronged digital identity solution and enriching customer profiles with customer interests and purchase intent data, it s time to activate the list. A client with 25 million previously unreachable households could now deliver advertising to over 17 million prospective customers with multichannel advertising. And most importantly, 1:1 targeting against enriched customer prospect lists is proving to be more effective in driving conversions than past targeting methods. Additional use cases: Existing customer suppression Include data on existing customers to prevent reaching them with ads aimed at new customers and avoid wasted impressions. Cross-device targeting Coordinate impressions across all consumer device touchpoints. Efficient multicultural targeting Identify households of a specific ethnicity or nationality and serve ads to the websites browsed by each household, thereby reaching all levels of acclimation in the household. Real-time performance optimization Dynamically remove low performing placements, redirect ad dollars to high performing placements, and find additional placements with similar qualities, considering variables such as website, ad position, ad size, time of day, day of week, and pixel data MaxPoint Interactive, Inc. A MARKETER S GUIDE

17 Enriched Data Sets for Powerful Shopper Targeting Are you one of the companies with multilayer distribution systems and corresponding marketing challenges? Automakers, for example, have national brands, regional dealer associations, a variety of online shopping tools, and individual dealerships where purchases ultimately happen. CPG brands not only have to worry about brand marketing, but also shopper marketing to drive brand buyers to the retailers that carry their products and to support retailer-specific promotions. If you have existing customer files, you can already activate direct mail or marketing to these customers. But have you considered ways to activate them at retail? What are you doing to expand the scope of your data beyond your known customers to achieve the scale necessary to move the needle on store-level sales? How can you enrich your data sets to make them more powerful for targeted marketing? maxpoint.com

18 Match Let s take the example of a brand that had identified six million households nationwide as its top customers. After matching its top customer list against a single source of digital identity data (cookies), it was ultimately able to reach less than 20% of those households with a digital ad campaign. After applying a multipronged identity match, the same brand was able to associate over 70% of its top customers with a digital identity and reach over 85% of those in a digital ad campaign. A multipronged matching solution ultimately reached 4x more top customers with digital ads than a competing cookies-only solution. Enrich Once you have a list of who you can reach digitally, the next challenge is deciding what you say to them. One of the biggest issues for shopper marketers is aligning buyer targets with a retailer s shoppers to send ads only to the households located in proximity to and with a propensity to shop at a given retailer s stores. Unfortunately, it s not uncommon for a predictive model to give a high propensity to shop this retailer score to households that are geographically nowhere near a retailer s store. Appending online interests and purchase intent indicators can also help refine which customers should receive ads and promotions for specific varieties. An online interest in healthy eating, for example, could be used to determine which top customers should receive offers related to a healthier product offering. Activate When preparing to activate digital advertising against a specific customer list, there are three critical factors that shopper marketers must consider: EFFECTIVE DELIVERY With the right technology partner, a CPG brand can expect to reach about 60% of its targeted CRM households with a single digital ad campaign. Individually addressable advertising for a top consumer target has been proven highly effective in generating incremental sales. SCALE While advertising to only top consumers is efficient, it doesn t typically provide scale, nor does it reach the new and infrequent brand buyers whose participation drive a measurable increase in store-level sales. Thus, the ideal ad campaign for shopper marketing will reach a broader shopper base in addition to your brand s top customer file. For maximum effectiveness, supplement your customer file with similar households around your stores. MEASUREMENT Another critical factor for shopper marketing is measurement. Both the shopper marketing team and the retailer need to see quantifiable results from each campaign. And once you ve spent the money building, matching, and profiling your customers, you ll want to determine whether the investment was worthwhile. The current best practice for measuring individually addressable advertising is to match your customer lists against those of a company, such as the retailer itself or a receipt-scanning promotion company, that collects household-level purchasing data. You can then analyze the impact of advertising on purchases by each distinct household group MaxPoint Interactive, Inc. A MARKETER S GUIDE

19 MaxPoint is a marketing technology company that generates hyperlocal intelligence to optimize brand and retail performance. We provide a platform for brands to connect the digital world with the physical world through hyperlocal execution, measurement, and consumer insights. LEARN MORE sales@maxpoint.com maxpoint.com

20 2017 MaxPoint Interactive, Inc. A MARKETER S GUIDE