2020 brought forth several changes for marketers – digital transformation, changes to data privacy, and new consumer behavior. In the midst of all these changes, there are a few key principles that should drive marketers, shares, Richard Jones, CMO, Cheetah Digital.
Earlier in 2020, Apple announced plans to restrict its IDFA, a mobile ad ID for ad tracking or measurement. The plan is to require developers and publishers to get permission from users before using the IDFA, which created an uproar from marketers as this would completely alter how advertising is done. While Apple delayed the launch until 2021, the reality remains, many marketers are not prepared for the change. This news is just one small piece of the change marketers face in 2021. At the heart of many of these changes is a challenge to how marketers can build relationships with consumers online.
Let’s walk through a few of the key changes marketers need to be aware of.
Digital Acceleration Is Happening at Warp Speed
According to a recent survey, COVID sped up technology adoption by several yearsOpens a new window . Before COVID, digital transformation was on the radar for most businesses. Overnight, it became essential as there was a sense of urgency to figure out how to take processes and interactions traditionally done in-person and move them online. Consider the restaurant industry; many restaurants had already made investments in digital technology to support the in-store experience. But when shutdowns came, they suddenly lost a majority of their foot traffic. These restaurants had to embrace online orders, pickups, and new digital avenues to reach customers outside the restaurant walls. Retailers faced similar challenges as shoppers flocked online. Ecommerce is now the norm, which brings with it not just a new technology for marketers but new tactics to market to consumers. Across industries, businesses are seeing digital transformation happen at unprecedented rates, which brings a lot of changes to how marketers operate.
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Trust Is Essential for Building Consumer Digital Relationships
In a crisis like we have experienced this year, consumers look to brands they trust. This trust is not just around safety and procedures related to the pandemic; 2020 brought social issues and data privacy to the forefront. As I mentioned, Apple announced changes that will require advertisers to request permission to use data, but this was not the only news related to data privacy. California voters approved the California Privacy Rights and Enforcement Act (CPRA), which gives consumers more protection over certain types of data and adds safeguards to protect minors. All these changes reflect the emergence of the trust economyOpens a new window , which simply means trust is the most important tool marketers have. In a study earlier this year, nearly 40% of US consumers said they do not like personal ads stemming from cookie data. Consumers have spoken; they care about their data privacy, and marketers should too.
Omnichannel Is the Norm
Consumers are interacting with brands in new ways because of the pandemic. Obviously, digital channels became increasingly pertinent as the pandemic forced shutdowns of in-person interactions. But now, brands must figure out how to target customers through several channels. Bloomin’ Brands has seen the value of mastering multi-channel messaging. They are seeing eight times the revenue from customers who engage with them through multi-channel messaging versus those that only use one channel. Consumers have high expectations about a brand’s digital experience. Now that almost everything is digital, brands must ensure their experience across channels is consistent.
So, what do marketers do with these changes? How do they adjust to a world without cookies or third-party data and do so transparently? I believe there are three key principles that should drive marketers in this digital acceleration.
Become data-driven
Becoming data-driven is the key to success moving forward. It’s learning how to leverage the right kind of data because marketers cannot be reliant on cookies or third-party data anymore. So, how do you become data-driven in today’s world? It is no longer just about buying ads and posting on social media; it is about building direct connections with customers. One future-proofed way for marketers to move forward is with zero-party data. Zero-party data is any data a customer willingly shares with a brand in exchange for value. Crucially marketers must also augment this data by pooling data from other customer interactions. Customer behavior has changed as a result of the pandemic; you need to learn about their new behaviors. A great way to do this is by compiling your data from customer interactions and using this to inform how you segment and message to customers. Let the needs of customers define segmentation. Some do not feel ready to shop in-person but will do curbside pickup, others may be ready to dine-in at your restaurant, and others will continue online shopping because of the convenience. Let the new behaviors define your strategies.
Create a value exchange
Forrester recently shared they have seen a 200-300% increase in inquiries on how to collect zero-party data. The key to collecting zero-party data is creating a value exchange that builds trust. Like I mentioned, zero-party data requires a value exchange. So how do marketers do it? I think it’s time to return to email. Email addresses might be one of the most valuable pieces of data you hold because email creates the opportunity to build a direct connection with consumers. Marketers need to leverage email to start the value exchange. Consider how you can also leverage your loyalty program to offer value to customers in exchange for data. Nearly 90% of consumers say they are willing to give brands personal data in exchange for rewards, discounts, points, or coupons.
Embrace next generation personalization
First-generation personalization was largely a continuation of traditional segment-based marketing. Next-generation personalization is fundamentally different because it works at the true individual-level. And data is the key. Traditional personalization vendors emerged almost 20 years ago to provide ways of engaging consumers on websites by attempting to get the right content into the right place at the right time. While this remains laudable, marketers and vendors alike have found it difficult to deliver on the promise. According to Gartner, 80% of marketers still struggle to gain ROI from personalizationOpens a new window . Why? Data. Gartner notes that 27% of marketers believe data is the key obstacle to personalization, revealing their weaknesses in data collection, integration, and protection. Personalization is all about the data: batch, streaming, structured, or unstructured, you need it in one place to aggregate, analyze, and activate.
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A lot has changed in 2020, but one thing remains the same – engaging with customers directly will be the most fruitful strategy. Let the right kinds of data drive your marketing strategies, and you will be set up for success. Forward-thinking marketers must develop the business case for leveraging a platform that harmonizes all customer data from whatever touchpoint into a single source of truth where marketers can turn insights into action.