Advertising technology has been in a growth phase for close to twenty years. One of the major milestones was Google’s acquisition of AdMeld in June 2011. This completed the programmatic dream with the first ad exchange and with it end to end, marketing goals through to advertising and conversion.
With the programmatic advertising supply chain in place marketing departments could, for the first time, connect the dots in an automated fashion from all marketing budgets and in-house CRM data. This CRM data collected from customer touch points through website systems, outbound marketing intiatives and via external vendors managing promotional intiatives. The nuance here is that data sets can be combined that normally never have been. As market research experts determine success metrics manual analysis normally leads the way but the opportunity now arrived quickly, unexpectedly.
There are two opportunities now in view:
- Unified Data — The opportunity to be specific is to create a new unified approach to spending on marketing but to do so new concepts and new technology is needed. This is because it would be bad science to just push data sets together that have, to date, had different objectives and different applications toward business planning. Specifically this includes traditional channels for outbound marketing, public relations and advertising but at this point in time also incorporates many data and services owned by IT departments and outsourced vendors.
- Cost Savings — The other huge opportunity to combine marketing budgets also means removing the silos is massive as we know there are redundant actives where the same customer could be counted as a conversion from multiple budgets. Disparate data sets has required redundant efforts to achieve sales. But this can only be addressed by combining data to find the delta and reduce efforts that are not needed or total sales could be negatively impacted.
Reducing marketing waste significantly cleans up the data for a much smarter strategy to emerge including ways to find new customers and grow the business. For decades the way to approach something like a back-to-school promotion for a retailer was to increase the budget from a previous year by a set percentage and execute the same media strategy adjusting spend per channel based on success metrics from the previous year or promotional initiatives. Most of the focus traditionally has been on creative, artwork derived from new products. In staid, corporate environments making any change requires approvals and timing that will not come together in time to execute so it is easiest to just keep doing the same thing.
Today however we have seen direct-to-consumer (DTC) brands sprout up seemingly overnight taking advantage of a unified marketing approach and create strong value for their investors. Even more threatening to major brands is how quickly DTC brands change customer habits by removing friction in the buying and subscription process. All of this is taking place through the use of unified marketing and buying data, the reduction of marketing waste and a personal branding approach. The products do not even need to be quality to make noise in a major category such as men’s razors.
The need now is for unified attribution something that sounds much easier than it will be. The desire I have learned from marketing departments is to combine Omniture user data from the website, outbound marketing from email blasts, public relations (non-paid media), advertising data (buying, performance and verification) with traditional customer segments and offline data (receipts, zip codes, etc.). Digital advertising has long lived with the last touch model for attribution which pretty much everyone disliked (except for search vendors). To deliver the new model (which will surely evolve) we need a new technology based approach to attribution.
Behind the scenes of everything AI is lurking as well with one-off vendors providing solutions ideal for staid, corporate departments that cannot execute more than the cumbersome work of the promotional cycle. This means some marketing departments are benefiting from AI before they have a unified point of attribution which seems silly but the point is that this new reality is growing up all around us already out of dire necessity. The disruption of everything will only become louder as marketing technology evolves to meet the needs.
Advertising continues to evolve with the walled gardens (Facebook, Google, etc.) on the verge of being dismantled due to anti-trust violations. Additionally the privacy concerns from anti-tracking laws ironically benefited the walled gardens as they could use internal proprietary levers to game-the-system (share personal user data from buying to conversion) for their clients. How this all shakes out will greatly impact the marketing tech stack but should not in any way impact the desired to unify budgets, buying and conversion data.
The main challenge with aligning data sets is how to do it and this is where market research concepts need to be worked through by the experts to identify how each company wants to proceed. This type of thinking will greatly impact enterprise marketing products going forward. For example combining advertising data with website data is not something frequently done before this point and perhaps should not be done without a way to unify under a user ID or using a customer data platform (CDP). From programmatic advertising data can be aligned by impression or auction but employing a user ID is somewhat challenging due to privacy laws.
Additionally the idea to align all marketing data sets will need to be weighed against the match rate of data sets. For example if the best that can be done is to align 40%-65% of the data management will need to decide if the effort is worth it because it will be significant change across the organization to accomplish this. Mostly likely they will proceed assuming fairly that new concepts and technology will arrive to close the gap and improve the match rate.
If your organization is looking to move forward down this path here is what I recommend:
- Identify a project lead who has years of experience with the systems and data sets used. I highly recommend a consultant who will work in the organization to move this forward.
- Identify the high level goals that your organziation could achieve from unified marketing and advertising data. These can change over time so no need to be too specific but even if cost savings is the only goal it will be worth the effort because this concept will become core to marketing moving forward.
- List all the systems, data sets and if possible key field from each data set that is required for ongoing analysis. Also include systems you expect the organization to have in the near future.
Surely there are organizations that might believe this concept is not something they need as they will never be able to fully automate the full ecosystem (i.e. automotive). I highly recommend giving this opportunity a thorough look as if you were going to move this direction because the learnings will not lost on how the future will look. Even if your organization expects to be outsourcing advertising for the long term it is valuable to understand how data can be in-housed and used for ongoing analysis. Having knowledge of how the ecosystem works will allow you to better manage vendors doing the work as well.
We can be confident that the the pace of change will continue to quicken as savvy marketing departments come up with action plans that will become success stories. With the cost saving opportunity we should not be surprised to hear management ask us how we can take advantage of unified marketing data. Many important details and products need to be addressed for these opportunities to become realized for industry but beginning the work is exciting and many careers will be defined by this monumental movement.