Social media can be a company’s powerful ally or damaging foe, says Alex Yoder, CEO of Webtrends.
The next big bang
Combining online and offline customer data sparks explosion of new business insights.
For decades, marketers have struggled to deliver relevant information and promotional offers to targeted audiences. Television, direct mail and other forms of traditional advertising can, at best, be aimed at demographic segments, but they can’t take into account specific consumer interests or intent. The Internet, however, has presented new opportunities to understand customer behavior in previously unimagined ways. People will exhibit unique and discrete behavior on the Internet that they would not otherwise demonstrate, creating unique insights into consumer cause and effect.
The emergence of the Web has changed how consumers obtain information about products and services. With data about nearly anything a few clicks away, people seek out information when they want it and on their own terms. As a result, they no longer tolerate being sold to—they want to be informed. To best respond to this changing dynamic, the most capable marketers work with IT and online data with open eyes, new vigor and a focus on bringing together these vital insights to maximize customer value.
The mission of the marketing organization is clear: Know your customer. Indeed, the Holy Grail has always been to acquire an intimate understanding of individuals and to engage them with relevant and timely one-to-one interactions. Fortunately, as the urgency to provide this personal experience has emerged, so have the means to do so: the Internet.
As the primary source of product research, the Web provides a wealth of data about consumer interest and purchase intent not available offline. Each time they perform a search, they communicate a level of curiosity in a given subject. By clicking on a search result or banner ad, they signal increased interest. With each page read, document downloaded, video watched and product added to a shopping cart, individuals reveal something about themselves. And with each online action, a record of the event is captured and stored.
Social media has taken the evolution of consumer power a step further. It is creating much more data for marketers to track, as personal publishing platforms become easier to use and more pervasive. The proliferation of blogs, peer networks and messaging technologies provides the consumer with countless sources of information and feedback on products and services. Indeed, control over brand images is being wrested from their owners by the consumers who share their experiences online. For organizations that provide a good product or service, along with a positive customer experience, social media becomes a powerful ally. For those that don’t, the voice of the consumer could soon damage the best-laid marketing plans.
The evolution of Web analytics
For years, online data and offline data have been cataloged by Web analytics vendors. Historically, these vendors have leveraged this data to provide aggregated reports on Web site content interest and online campaign effectiveness. While these reports are incredibly valuable in guiding digital marketing programs, they do little to provide insight on individual customers. This phenomenon is changing at an incredibly rapid pace. Web analytics is evolving to make detailed consumer-level data readily available.
Conjoined marketing will empower companies by letting them analyze every aspect of customer data and, most importantly, act upon it decisively.
A catalyst for this change is the move from closed and proprietary data stores toward solutions built on industry-standard database technologies, published data models and open data access application programming interfaces (APIs). This has enabled the integration of online consumer data into corporate data warehouses, marketing systems like customer relationship management (CRM) and e-mail, and modern business intelligence (BI) systems. Suddenly, the Holy Grail is within reach.
Leading the way
Many organizations are already taking advantage of accessible consumer-level behavior data:
- One major travel site merges offline transactional data from its CRM system with online behavioral data. In so doing, it can create detailed customer segments as well as lifetime value estimates. It then identifies and delivers more relevant content on-site and via e-mail promotions to those audience segments. Also, the firm can uncover untapped markets and business opportunities faster than ever before. As a result, it has increased bookings to secondary destinations, improved the accuracy of inventory and supply information, and boosted re-engagement through targeted e-mail marketing.
- Similarly, a leading insurance company is enhancing its marketing activities. Like other insurers, its Web site is a primary source of information about products and services, but purchases commonly take place offline. By using its data warehouse to integrate online campaign data, Web site activity data, and transactional data from its call centers and agency offices, the company can determine which online promotions lead to purchases and which segments are ultimately the most profitable for the company. This insight has resulted in improvements in online and offline customer acquisition, targeting and up-sell efforts.
Timing is everything
Just as the availability and the enrichment of consumer data is vital to improving multi-channel marketing activities, so is the speed of the data. The pervasiveness of mobile devices, for example, is altering purchase habits and accelerating sales cycles to the point that yesterday’s data is no longer timely enough. Instead, leading marketing organizations respond at the speed of consumers and their devices. This combination of data proliferation and the need for real-time information underscores the necessity for true enterprise scalability in a data warehouse and the online analytics solution.
It’s easy to imagine a future in which many new sources of information add to the collective knowledge base of consumer behavior. Home entertainment appliances, including video game consoles and set-top boxes, will be fitted with data-collecting technology. When these sources are married with an individual’s online behavior, demographic data and past transactions, marketers will be empowered to deliver messages that resonate with a consumer’s lifestyle and personality. And with increased timeliness, these messages will be in tune with the customer’s place in the sales cycle.
The key to it all will be to consolidate, enrich and deliver timely information to the people and applications that collectively run the marketing engine. We’re more than 15 years into the Internet revolution, but we’re only getting started.
When an organization’s customer data is stored in silos, it can’t be used effectively to provide a 360-degree view of actual behavior. Pulling together the offline and online data—conjoined marketing—will empower companies by letting them analyze every aspect of customer data and, most importantly, act upon it decisively. Doing so in real time is a major challenge but one that will yield considerable results.