The new frontiers of online marketing see a new role emerge: that of Interactive Marketers. No matter what business they’re in, marketers have one goal: lead potential and existing customers through the conversion funnel. Knowing why and how customers convert becomes crucial to plan marketing strategies and optimize investments, as we’re moving from a channel-centric to a customer-centric approach. Interaction, conversion and purchase behaviours change from one customer to the other based on thousands of factors, however it is possible to group customers into segments based on similar behaviours and common characteristics.
Segmentation is a foundational practice allowing marketers to tailor offers, communication and channels to their audience, however compared to the practices deployed in traditional marketing by their colleagues, Interactive Marketers face many more challenges:
- Data are fragmented, coming from multiple sources and most often channel-based rather than consumer-based. Websites content fruition is still measured through clicks, pageviews and shares and does not take into account who is viewing your content and how likely he/she is to react to it, as it does not combine content fruition with user information in an actionable manner.
- First party data, usually managed through CRM’s, are rarely reconcilable with third party data that marketers buy from different vendors. However, it’s first party data that contain the most meaningful information and most of the predictors of your customer behaviour: (1) who your audience is; (2) when, how and why they enter the conversion funnel; (3) how much they’re worth; (4) how they interact with your media touchpoints (response to campaigns, visits to your websites, advocacy etc).
- Even if Interactive Marketers manage to combine multiple data sources maintaining a customer centric approach and identify the right segments to go after, they face more challenges as they look for impressions to buy: publishers hardly go beyond age, gender and channel as they define the audience they offer, while advertisers look for buying personas and specific consumer profiles. As a result, they often rely on third party data to optimize targeting, but the quality trade-off they make is huge: third party data do not include insights on how these prospects interact with the investors’ media touchpoint, nor with the publishers’ sites, and whether their behaviour is a predictor of likelihood to buy.
It’s like saying that the way you talk to your audience is determined primarily by the side conversations you overhear as they speak to others, rather than by the way they interact with you and with the place you meet them in. How effective can you expect to be in catching their attention and generating a positive response? If we believe that first party data are crucial to identify conversion opportunities for a given brand who wants to BUY a presence where its audience is, they are as crucial for a brand who wants to SELL that presence. The more a publisher is able to identify the target segments an investor is after and label them using the investor’s consumer-centric language, the more its offer is worth.
So the value lies:
- For buyers: in their capability to identify the segments to target based on observed customer behaviour, and target them in the right place at the best price
- For sellers: in their capability to identify those segments as they are on their poperties and maintain control over this key piece of information so as to sell impressions at the best price
Third party data are still a useful source of information, but they should not be the primary indicators for target audience profiling and advertising budget allocation. Combining data coming from different sources and turning these into targetable segments that can be reached in real time is the purpose of a DMP. Consider building your own DMP to leverage first-party data at best and maintain ownership of their value.