STACKED: The Age of the Customer

“The Age of the Customer.”

Well that’s what Forrester calls it anyways. Here’s a great excerpt from the reports summary:

“Empowered customers are disrupting every industry; competitive barriers like manufacturing strength, distribution power, and information mastery no longer create competitive advantage. In this age of the customer, the only sustainable competitive advantage is knowledge of and engagement with customers.”

Some more data courtesy of Gartner:

Get the point?

It’s become mission critical to identify and communicate with your customers in order to create and maintain a competitive advantage. Yet it’s becoming harder to actually do so because of the proliferation of devices and media channels where your customers are spending their time. But it’s clear if you can piece this all together, you are poised to create incredible value for your organization.

In my last piece, STACKED: The Race for 1-to-1 Marketing at Scale, I highlighted some of the massive industry shifts taking place right now and laying the foundation for brands to become customer centric in their approach to marketing. This week, I’m going to cover exactly how you can prepare your company for “The Age of the Customer”.

The first step to engaging customers on an individual level based using historical information/knowledge (1st party data) is identification. If you can’t identify your customers, then you sure as heck can’t engage with them in any meaningful way.

Think about all the credit card companies offering you special promotions for that card you already have, or the cable companies constantly bombarding you with ads for new customer rates, even though you’re a long standing customer that pays much more. Why? Because on the web, it’s very, very hard to tell your customers from your non-customers, since most online customer targeting is reliant on an outdated form of identification known as “cookies”.

As LiveIntent President, Dave Hendricks, pointed out in his Click Z article “People Versus Pixels”, cookies are a very poor identification method. They are used to identify a computer not a person, and are limited by browser, which makes speaking to customers vs. prospective customers difficult, if not impossible.

In an increasingly customer centric world, it’s getting harder and harder to identify your customers across their many devices and media channels…scared yet? I wouldn’t blame you if you answered “yes” but…. There’s hope!

 

That’s right. The email address.

The email address, you see, is the key to unlocking all of the challenges being presented by today’s changing digital world. It is the perfect identification layer needed to distinguish customers from prospective customers, buyers from non-buyers, heavy spenders from light spenders. The email address is both knowledge AND identity, and that’s the key.

If you were to sneak a peak into any major retailer’s customer database, 9 times out of 10 the profile key (aka the unique piece of data that ties all information together) will be an email address. That means all of the transactions related to that account are stored against your profiles email address. Think about all the data Amazon.com has stored on your email address. It would be incredibly valuable and from a marketing perspective, almost priceless.

The email address brings with it incredible capacity to on-board unbelievably valuable data, data that can be used to target an individual with a specific promotion or offer based on their profile, and there is no other identification method in existence that can do that.

Sure, a unique customer ID will do the trick on your own properties, but as soon as someone leaves you become reliant on an unreliable cookie to do the work for you. But the email address has stood the test of time. It is the glue that holds the entire Internet together and continues to grow more valuable as the Internet has matured.

Email is like a Blue Chip stock; it’s not sexy or volatile, it just delivers and pays dividends.

The email address is mission critical in the Marketing Stack of tomorrow. Its ability to identify customers across channels and devices, as well as bridge offline data, makes it the centerpiece to a customer centric universe.

The question now becomes, “Are you set up to take advantage of these new capabilities? Do you have the data and the scale (number of emails) to beat your competitors and win the battle for mindshare?”

Technology is making available some truly game changing capabilities but only those who are prepared with the right data will be in a position to win in this new Age of the Customer.

In my next and final installment, I’ll be outlining what CRM programs will look like in the very near future and how marketers can use technology to maximize the value of existing customers.

Originally published on LiveIntent.com

STACKED: The Race for 1-to-1 Marketing at Scale

What an exciting time to be alive! If you are in the marketing/ad tech space, you have front row seats to the greatest shift in communications the world has ever seen. Gone are the days of creating a single message that gets distributed to all of your customers and prospects alike. Technology has now made it possible to identify your customers across their many devices, different media channels, and browsers, with the ability to use customer profile and behavioral data to select the right message. 

Many would call this the “holy grail” of marketing, a true 1-to-1 dialog with your customers based on where they are in their life-cycle. We’re not quite there yet…but we can see it on the horizon, and in the very early innings of this ballgame, the major technology players are all starting to assemble their lineups.

Outside of the incredible rise of programmatic buying and real-time bidding, one of the more interesting trends right now is the merging of Ad and Marketing technology. For a long time, these two have been completely disparate. Ad tech was used to target prospective customers, while marketing tech was used to communicate with existing customers. Simple. Easy. Limitited.

But now, the environment is changing. Industry-changing trends and technology have heralded the convergence of ad and marketing technologies, with the promise of a single technology stack for both prospecting and CRM.

Above all, these three events are the most accountable for this evolution:

The Rise of Mobile:

Look no further than the above chart to see the rapid rise in mobile. 2014 is truly an inflection point, as total mobile users will surpass desktop users. After that, there’s no looking back. We now live in a mobile-first world. But the rise of mobile posses some serious threats for the Ad Tech space, specifically in the area of audience addressability.

In a recent AdMonsters piece, “ID Is Key: Unlocking Mobile Tracking & Cross-Device Measurement, Part I” James Lamerti GM and VP of AdTruth had the following to say:

“Mobile inventory is less valuable than desktop because it’s very difficult to build audience in mobile – we simply have no identification layer,” says James Lamberti GM and VP of AdTruth. “We need the ability to speak to advertisers and confidently say, ‘Here is my mobile inventory, here are my heavy travelers, here are males 18 to 25, here luxury brand buyers, etc.’”

That’s a pretty straightforward look at the problem. CRM data, however, can help unlock the ID layer. The email address, for example, is the perfect identification layer for a few reasons:

• Almost 50% of the world has one. 2014 will see more than 4B global email accounts. That’s 4x the size of Facebook.
• They are unique. Sure, people may have a few different email addresses, but they are unique to an individual.
• They are cross channel. You email is the same on the desktop, phone, tablet, TV, car, house etc…Every major platform (Apple, Facebook, Twitter, Amazon, Pandora) requires an email address for sign-up.
• Email is where your customers are spending their time. Email is the #1 app on mobile and tablet devices, in terms of overall time spent. Marketers and Advertisers of course want to be on any platform where their customers are spending the majority of their time.

Facebook:

We have to give Facebook substantial credit for the convergence of ad and marketing tech. In one fell swoop, Facebook’s launch of Custom Audience successfully combined RTB and CRM. Custom Audience has now given way to other similar solutions from competitors. Twitter has a Tailored Audience product, Google offers CRM data matchingwithin Gmail and I’d fully expect that other major players with a large number of logged in users (Yahoo!, LinkedIn, Amazon, Pandora, Apple) to follow suit in the coming months.

With Custom Audience, Facebook really addressed a major pain point with CRM marketers. Prior to the launch, email was the only arrow in their quiver when it came to communication with their existing customers. In order to reach these customers, especially those that didn’t open regularly, the answer was often: “Send more email!” Not always a bad idea, but with Custom Audience, Facebook unlocked a brand new way of speaking to your own customers: 3rd party media. Now brands can increase their reach and frequency of messaging against highly valuable segments, using 1st party customer data to target based on purchase history or stage within the purchase cycle. This was a major, major win.

The Death of the 3rd Party Cookie:

There’s no doubt the 3rd party cookie is going the way of the dinosaur, as many in our industry are predicting it’s demise within the next 24 months. Browser makers and the rise of mobile have certainly accelerated their demise, but let’s be honest…they were never really any good to begin with. The accuracy of 3rd party cookies has never been good… ever! Maybe 30-40% of the time you hit the right audience, with the remainder being simply wasted. That kind of accuracy was never sustainable. So as the cookie fades to black we’re seeing companies begin to look for alternatives.

Just take a look at the M&A over the last few months:

Salesforce buys ExactTarget

Oracle buys Responsys

Adobe buy Neolane

Experian buys AdTruth (via 41st Parameter acquisition)

Criteo buys Tedemis

AdRoll buys Userfox

Lotame buys AdMobious

IgnitionOne buys Knotice

Each acquisition looking to address the same problem: how to target an addressable audience across their devices? 

The interesting trend you may or may not pick up on is that most of the companies acquired have roots in email. As I mentioned before, this shouldn’t really be much of a surprise given that the email address is as good of an ID as there is, likely the best.

The ability to identify with and target with accuracy is incredibly important. Just look at Facebook’s incredible rise as a mobile advertising player. They are projected to capture an astonishing 22% of all mobile ad dollars in 2014. This is no small feat, and really speaks to the need to provide marketers and advertisers addressability in a mobile-first world.

In a world with no cookies, 1st party log in data is King.

These are the major market trends that are forcing everyone from advertisers and marketers to technology providers to rapidly adapt their product offerings. In part two of this series, I’ll take a look at exactly how the major advertiser and technology companies are building platforms to address the current marketplace and the needs of marketers and advertisers.

Originally published on LiveIntent.com