In this exclusive article for ExchangeWire, Matthew Pepper (pictured below), managing director of Sub2 Technologies, outlines the key areas to consider when constructing a successful data driven marketing firm for the current era.
Data driven marketing has been a growing discipline ever since the days of David Ogilvy in the 1950s. Online media and the big data revolution have only accelerated the growth. How data has been used in marketing has obviously been massively impacted by digital in the last twenty years. However, the recent changes in global privacy legislation, started in Europe with GDPR, as well as changes in how browsers handle cookies, have led another shift in data driven marketing. Combined with that has been the proliferation of new platforms in ever more channels.
Crucial to a successful data driven marketing approach is the need for brands to utilise data in all their core channels and platforms. Online is dominated by the big six online platforms: Google (including YouTube), Facebook (including Instagram), Amazon, Twitter, Snapchat and Pinterest, where data portability is often difficult due to the walled garden nature of some of the platforms. However the web is no longer the limit to where data can be pushed. In digital out of home (DOOH), the likes of JCDecaux and Bitposter offer programmatic inventory. Whilst in connected TV, Xandr, Sky’s Adsmart, and ITV/Amobee, all allow data targeting. Added to this of course is the world of open RTB display and video, with emerging players such as TikTok looking to change the landscape. Combining all these platform opportunities together delivers the vision of omnichannel marketing today and heralds a future where all media is delivered by a central platform. As such it is vital that data driven marketing is able to influence all channels and platforms holistically.
Creative is a hugely important, and often undervalued, component of data driven marketing. It is vital that creative is optimised towards the viewing audience and maximises the potential of the channel. In the planning phase of a campaign, data strategies should be communicated to the designers so they can ensure that there are relevant options. Creative ideally also needs to be quickly adaptable such that it can respond to new opportunities. Design skills alongside dynamic templates, data strategy, and optimisation, are all a vital part of the mix.
Delivering against a data driven omnichannel world requires a new type of technology. Customer Data Platforms (CDPs) have taken over from Data Management Platforms (DMPs) as the go-to technology. This is because they can allow all of a brand’s data, both offline and online, to be used more flexibly in all channels. CDPs are also far less reliant on cookies than a DMP. In such a connected world it is important that any chosen technology stack is able to work in harmony, that means an interconnected stack that will likely include a CDP, a DMP, DSP, ad server, and creative platform. With the exciting opportunities that machine learning and AI offer, it is also vital to maximise these and automate as many processes as possible.
First-, second- and third-party data
Crucial to a brand’s success with data is its ability to leverage first-, second- and third-party data. A brand’s priority is controlling their own first-party data as they need sophisticated segmentation options, powered by machine learning, so that they can optimise their most valuable customers and prospects, across all channels, in real time. Second-party data is equally important. Without it a brand is only able to talk to its current customer and prospect base and will therefore struggle to grow. Second-party data allows brands to broker partnerships giving them access to their best and most-likely prospects. Third-party data completes the data portfolio for successful marketing. The role of third-party data is to add detail for the optimisation against customers and prospects identified by first- and second-party data. That detail can include context, keyword, device, social signals, and more.
Measurement and attribution
“If you can’t measure it, you can’t improve it” by Peter Drucker is one of the most important quotes in modern business. Its importance to data driven marketing should be obvious, particularly in the omnichannel world we describe above. Web analytics is hugely important, as it is the basis on which most e-commerce companies operate from. Yet web analytics alone will not lead to successful data driven marketing. This is because web analytics only sees what happens at the bottom of the onsite funnel and is not designed to measure media performance offsite. Smart agencies take a two-tiered approach, using web analytics and attribution systems. Crucially brands need to be able to align the metrics so the two sets of numbers can be rationalised. A third tier of media mix modelling is recommended for clients with large video and above-the-line media spend. In this way brands are able to measure performance rapidly and understand the true value of media spend.
Transparency and visibility
2018 was the year in which transparency really hit the headlines. However, it remains as important today with many of the lessons not heeded by many companies. Fundamentally, a lack of transparency upsets the balance created between data driven marketing and attribution. Without transparency, how can you be sure that any decisions or optimisations are made with the sole benefit of the brand in mind? Furthermore, no one knows the brand’s priorities better than the brand. Therefore, it is vital that brands have full visibility of the media they are buying, the creative they are running, the data being used, and the optimisations being made.
Bringing it all together. Expertise and collaboration at pace
The perfect combination is to combine clear strategic thinking with fast paced execution. Sub2 uses this approach to offer practitioners and partners able operate in harmony with our brands’ marketing departments for optimum knowledge sharing and efficiency. Brands need to constantly evolve their marketing and by working with a single talented team, highly responsive setups are achieved.