The coming wave of data convergence?

Every new technology comes with the promise of new capabilities, some of which are immediately apparent, and some that afford possibilities not immediately recognized, but that develop later. For those of us in the customer marketing and analysis side of the world, new technologies breed new types of data for analysis, and new applications of the data itself.

The current wave, which is still evolving, will usher in a new era of insight and targeting that will be more specific and actionable than ever before. This is creating more challenges for privacy and integration.

“Every customer touchpoint can create data,” said Adam Gitlin, head of data at Annalect, during a panel discussion at Advertising Week in New York earlier this month. “We all know that the data’s out there. The question is how we find it, and then connect it?”

“Unifying data is what adds the special sauce [to marketing]. Blow away the former view about data and know this is really about having conversations. As we unify the data we can have those important conversations [with customers]. We can mix the information from all of the touchpoints, like email and social. That data will then support and inform,” Jeff Nimeroff, CIO, Zeta Interactive also stated during the same discussion.

Past waves of convergence have included the integration of online shopping behavior with offline purchasing to create an integrated view of customer buying habits. The result of this integration is a higher level of relevance in communications and marketing by understanding more about the consumer. For instance, the multi-channel customer was found to be the highest-value, most loyal, and most likely to be a brand advocate.

Significant developments also occurred in the area of web traffic measurement, beginning with page views and click streams, but materializing into online behavioral segments for customized ads. A whole new ad industry matured based partially on this information. However, this data was largely compartmentalized away from customer transactional information, and there was not a natural convergence between the ad-centric advertisers and the customer-centric marketers. This is a missed opportunity that still exists today.

“We all know that the data’s out there. The question is how we find it and connect it. How do we start to incorporate data sets? The real challenge is trading data across ecosystems,” Gitlin surmised later in the same discussion.

At this point in time, there is a wide range of marketplace and technical developments that continue to offer new opportunities for better tracking and understanding of customer information or data. Of course, this should materialize into smarter marketing and advertising!

 

 When and Where

The most obvious growing channel is mobile, with smartphones and apps that collect an extensive amount of customer data based on interests and location. If a customer’s location is available to a company, they can make a lot of inferences:

  • Where they live, down to an address (where is their smartphone at 2am?)
  • Preferred locations / brands (BP or Exxon? Fill up near work, near home, or in-between?), fast food (Wendy’s or Burger King? Burger or chicken?)
  • Amount of driving they do
  • What billboards they pass
  • What digital advertising they are exposed to

Facebook is a great example of consumer opt-in. Once Facebook is downloaded to a user’s phone, geo-location and check-in features allow the app to track the user location in real-time. Marketers can also reach out to consumers via sponsored ads right on their news feed based on their likes, interest, and location. This can lead to more powerful messaging based on information such as if consumer is traveling, where they like to have lunch, what movies or concerts they go to see, the possibilities of available data are endless, and easily accessible.

Almost all applications have geo-location functionality and will continue to evolve in the areas of travel, restaurants, entertainment, and retail. Some examples include beacon technology and geo-fencing in certain locations for identification and tracking purposes. In most cases, the consumer has the ability to opt-out of any tracking, and provide explicit permission for the app to track them. Many consumers are open to such permissions if the value exchange is clear and compelling.

 

The future as it could be

 Picture marketing the way it could be. What if the dream of convergence was truly realized?  What would marketers be able to do? How would the bond between brand and consumer be enhanced? A top-of-mind list could include:

  • Recognizing high-value customers easily at every touchpoint – on their smartphone, on the web, via email, and other direct communications channels.
  • Delivering customized value propositions at every touchpoint.  It’s one thing to know who is valuable, it is quite another to have something different or unique to say. Real-time scoring applications exist to deliver important customer information to applications for customization. Recommendations, offers, and information can all be tailored based on specific customer attributes.
  • Web traffic can be differentiated analytically based on customer segments. A brand will know what their core segments, new customers, and prospects do online. This allows for web site configuration and communication to be tailored to influence behaviors accordingly.
  • Advertisers can know who they are reaching through various channels (mobile, outdoor, banner, etc.). Media can be priced on the quality of the traffic.

This all comes from integrating data from all different sources:

  • Offline transactions
  • Online transactions
  • Transactional trends (frequency, type, channel)
  • Demographics and segmentation
  • Web browsing patterns and habits
  • Mobile browsing
  • Geo-location tracking
  • Social networking sites

Of course, the consumer benefits too. Since a higher degree of customization is possible, they may see fewer irrelevant offers from brands. The value exchange means that they are exposed to products and offers that fit more closely to their lifestyle than today. This, in turn, should materialize into higher sales for marketers.

As Matt Zilli, worldwide head of segment marketing, Marketo, pointed out during the same panel discussion

“Customers are expecting us to understand who they are. We run the risk of annoying them if we don’t. We [as marketers] still think in channels; that’s not how customers think. Data is the way to solve that. Meet the customers where they are.”

 

What’s Next?

The marketing world is littered with past prognosticators of convergence and integration, so it may well be a fool’s errand to make any such predictions. However, one thing is clear: The path forward is more exciting than ever. The opportunities appear endless for marketers who are ready to forge a new way forward. New ways of analyzing old media and new media are possible, and marketers have the ability to be smarter about their investments like never before.

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