A study by the New York based Interactive Advertising Bureau (IAB) identified programmatic buying as the dominant trend of last year. The possibilities of the automated real-time trade of advertising were welcomed by many for the speed and innovation they brought to marketing while being mindful of issues like data control and transparency. But in 2016 the emphasis has shifted. This year’s number one key trend is cross-channel-tracking, while programmatic buying for new formats was rated second, with the cross-channel identification of target groups in third.
For me, this change in priority is significant. Programmatic buying is a self-contained, technology-driven process that takes milliseconds. It is fast and efficient but it doesn’t really help us to communicate more effectively with individuals in our target markets.
However, with the increase of cross-channel identification and cross-channel-tracking and attribution we’re seeing the rise of hyper-personalisation. Hyper-personalisation allows us to focus on the individual according to their interests and needs, across devices and in real-time. It is marketing returning to its core values, with the technology of the digital age. Here are the six significant consequences I believe the rise of hyper-personalisation will have:
- Display overtakes search. If you want to reach the user at the right time on the right device, display advertising is the way to do it. eMarketer has predicted that investment in display advertising will overtake investment in search advertising in the US in 2016. Individualising advertising themes in real time will be an integral part of the renaissance of display advertising.
- Retargeting is dead. The traditional approach to retargeting – with pre-set frequency capping, a 30-day cookie history and its focus on established, proactive contacts – is old news. If you want to approach customers intelligently in future, you’ll not only need to understand the exact customer journey, but you’ll need to draw on additional factors like the weather, time or location, as well as bringing in anonymised transaction data that reaches much further back than the 30-day cookie history. Only by considering all information and in real-time will you make meaningful connections with individuals. Showing the same message over and over again is no longer an option.
- Agility will become more important than speed. The speed of implementing new business processes doesn’t necessarily indicate innovative leadership or economic success in marketing. The agility of a business in adapting to changing competitive conditions is much more important, and is fundamental to hyper-personalization. To contact your target customers successfully in the digital landscape, you need to know exactly who they are. And you can only get to know them by integrating and matching all the data available: on- and offline-data, and all their purchasing behaviour. It’s only by bringing all that data together that you will be able to create one coherent view of the customer – and for many companies that means a new way of working.
- Co-working will replace data silos. Yes, customer data is an important and valuable business asset, so it is highly understandable that we get protective. But we’ve got to learn that cooperating with the right partners can give you an even better database, particularly in terms of the refinement of second and third-party data. It’s natural to be cautious about the eventual misuse of data but these fears are unnecessary, because the anonymisation of first party and transaction data is a mandatory requirement. Vetting and selecting the right partner is the shortest path to addressing data fears before they become marketing problems. While we tend to focus on technology, capabilities and cost, don’t overlook the service layer as a key value differentiator in data activation. You should expect your supplier to increase the value of your investment through expertise, proactive thinking and informed recommendations.
- No success without measurement. Even the best customer insights will turn out to be meaningless if the success of a personalised marketing campaign can’t be measured. Many forward-looking and innovative businesses are already investing in comprehensive cross-channel-measurement – it’s a key topic for marketers in 2016. It’s about a realistic mapping of cross-channel and cross-device marketing measures aimed at ultimately converting the user into a customer. Only by tracking the real journey of the user and quantifying each of the distinct marketing measures will you be able to measure your ROI in the long run. It’s not about measuring clicks, it’s about measuring results which means criteria such as Incremental Revenue Analysis (ICA) or the Return on Advertiser Spending (ROAS) will become more significant in future.
- The personalization of content will lead to a new relevance. The debate about ad blocking is currently discussed on a purely technical level. But questions like ‘How can publishers prevent ad blockers from stopping users reading their ad content?’ are missing the point. Online advertising – and especially display advertising – has to gain a new kind of relevance. Today it functions too much on the one-to-many principle, therefore aligning itself with newspaper ads, billboards and TV-commercials. For me, only the personalised approach – meaningful, one-to-one communication with the individual customer – can give new relevance to display advertising and end the ad-blocking debate.
Innovative and forward-looking marketers have realised: cross-channel user identification and one-to-one cross-channel communication with users – in short, hyper-personalization – will significantly shape our industry in the coming months and years. So, what are we waiting for?