Amazon has reported tremendous growth in ad sales business and has huge ambitions for it. It wants to use all the data it’s collecting through both advertising and commerce customer transactions to inform a more personalised and more effective customer experience. In this piece, Charles Bell (pictured below), director of sales engineering, EMEA, Sitecore, explains that there is a three-pronged approach to competing with the Amazon juggernaut.
If we take a moment to think about why it’s having so much success here, and will continue to do so even after GDPR kicks in, it is because Amazon provides a phenomenal bang for your data buck. If you didn’t allow Amazon to track and manage your data, you wouldn’t have a shopping history, you wouldn’t have a wish list, you wouldn’t have personalised recommendations, you would buy things you’d bought before as gifts, you’d be told to watch Peppa Pig instead of Sneaky Pete on Prime Video… so, the cost to you personally to opt-out of Amazon is very high. This means, under a single catch-all opt-in, they have rights to advertise, to personalise your customer experience based on your data, and to do a thousand other things.
This is a hard value exchange for brands to top if they want to regain ownership of the customer experience. After all, if they don’t, they’re dependent on Amazon (and anyone else with a more compelling value exchange that might act as a channel for them: eBay et al). And that is, ultimately, limiting. After all, if you don’t have a play in customer engagement, you end up a commodity; and commodities only ever compete on price.
What, then, can brands do to create a value exchange that is on a par with Amazon’s incredible power, recapture the customer opt-in, and deliver an individualised customer experience? One that is tailored to the totality of that customers’ footprint, in the real and digital realms?
Understand the omnichannel customer experience
Despite the acquisition of Whole Foods, Amazon’s retail presence outside the U.S. is relatively limited. For the most part, their mobile app is limited – its website is the dominant driver for customer engagement. Amazon doesn’t have a strong omnichannel play. Most retail brands, however, have a huge opportunity to capture data from the in-store experience and marry it up with the online experience to create a complete view of their customers.
Unfortunately, brands have traditionally lagged behind here. The problem they tend to have is that different marketing teams own different assets and channels – one team may look after the mobile app, another after the website, another after the in-store experience, etc. These teams are usually disconnected; and this makes it difficult for them to coordinate those touchpoints and come up with a cohesive strategy to capture all points. The same thing applies when it comes to marketing.
I’m finding that a lot of brands have a proliferation of tech – with each channel existing on a completely separate platform – which makes it difficult to create a cohesive strategy. Brands’ best chance for tackling the Amazon effect here is to unify these channels and genuinely gain a complete view of their customer.
Look and learn from customer insights everywhere you can
There are disparate digital platforms that will give you different insights into your customer behaviour and support your individualisation efforts. For example, what are they doing on Facebook, Instagram, fashion websites, etc? And, critically, you need to run intelligent attribution on these touchpoints to help refine and optimise your media spend in future.
The world is not one of single-touch purchases, but of multi-touch interactions; and running such multi-touch attribution is critical. Amazon will only really do this on Amazon itself; though of course it does that very well. For example, on Prime Video, you could be watching a TV cooking show featuring a celebrity like Jamie Oliver, then be prompted later to buy the ingredients for the recipe or one of his cookbooks on the platform. Or you could be watching Top Gear on your Fire TV, which has a feature segment on the best family car – they can offer you to ‘click here’ to receive a brochure on the car. Amazon has the ability to reach you in lots of different ways, but only really within the Amazon ecosystem itself.
Create contextual experiences based on the totality of the customer profile
Amazon’s ‘content’ play is very transactional – you bought/browsed this, so buy this. However, brands have an opportunity to use ‘selling as helping’ with their content. Loosely, if you’re going on a hiking holiday and you’ve searched ‘hiking boots flat footed’ but you’ve also browsed a fashion website, and you’ve entered your data into the brand website, a hiking brand might serve up content on advice on in-shoe support, the in-store fitting process, tailored to promote its haute couture line, etc. So, not just serving ads for a boot that supports people with flat feet, but targeting them with personalised ads based on the customer data they’ve collected. This creates a far more compelling experience than just being given incremental discounts for spending more and more money on Lego via Amazon, for example, or being retargeted by a brand you favour on a single e-commerce platform like Amazon.
Brands must create a compelling value exchange through individualisation
In a world where GDPR requires customer consent for every use of data, you have to be providing a pretty compelling reason to have a customer opt-in to that data exchange. Amazon’s incredible convenience as a retailer (and entertainment platform) means that it has a huge advantage, as well as a huge bank of data here. If brands can’t secure similar consent, they will face the risk of not only losing future data capture on their customers, but also the possibility of losing historical data at a stroke. Battling Amazon’s convenience as currency for data will be a challenge for many.
The main opportunity lies in changing the key customer interactions. By building brand loyalty directly and analysing how their customers are engaging with their content, brands can take a consultative approach with their customers. This more direct customer relationship and engagement will not only build loyalty and make the data value exchange more compelling, but it will give brands an invaluable opportunity to understand their customers better and create super-valuable, individualised experiences for them that they won’t want to give up.
To use a supermarket metaphor: it’s kind of like when brands pay a premium for being on the end of aisle shelves to get more customers to buy their products. By engaging with Amazon on its own terms, brands have to sell cheap and pay to be visible on the end of the aisle, via its Black Friday and other promotions. But if you find a way to provide real value to the customer through your content and customer engagement, you’re hopefully attracting them to your own aisle more regularly – and then you can stack your products and services wherever you like to grab their attention.
This content was originally published in RetailTechNews.