As retail brands work to create a future-proof identity strategy, many are moving from generic third party data behavioral targeting to more granular identity targeting.
The benefit of identity is that brands can individualize ad targeting. Rather than messaging to a large segment based on assumptive data, identity allows for personalization.
Identity has been typically used for advertising, but it can be very valuable for marketing purposes, too, especially to help brands expand the insights they have access to in order to personalize messaging on their site and across other channels and deliver a safer, more relevant customer experience.
Many brands are thinking about marketing from an “inside out” perspective.
For example, a retailer will use previous on-site shopping behavior to retarget and personalize their site visitors when they come back. And for new site visitors, they will model off of their group of recognized visitors to show them something similar.
In this common scenario, many brands miss out on identity-based insights about new site visitors that they might already be accessing for advertising purposes.
Take a retail customer who comes to an ecommerce site interested in beach clothes for an upcoming vacation to Hawaii. Not only has this customer not visited the site before, but they are about to make a purchase that is based on a one time event.
In a typical marketing program, the site experience might include product recommendations based either on a general third party data segment such as “working moms” or from a model that compares their behavior to other site visitors.
This typical setup generic segmentation causes the marketer to miss out on an opportunity to improve the customer experience and likely miss out on a sale.
This same marketer might actually have those insights available through their advertising team. Many ad campaigns use recent data such as searches and purchases to drive targeting, and they can be incorporated into marketing too.
An advertiser typically has the ability to test behavioral data and other audience segments with a pretty straightforward set of metrics including the effective CPM, conversion rate and other performance indicators.
A segment such as “working moms” can exist in the form of a third party data segment that includes anyone that’s ever read a mom blog, all the way to first-party identity-based data from logged-in members of a LinkedIn working mom’s group.
As advertisers move to an identity strategy, they are becoming savvier at valuing the latter, while using modeling to find more people based on this much more reliable data.
Marketers should embrace the same concepts, even if they don’t have the benefits of measuring CPMs. Take the shopper with a vacation planned in Hawaii.
If a marketer has bought a segment of generic “beach travel enthusiasts,” it will do nothing to help them know that at that moment, this person is looking for bathing suits, not parkas.
First, marketers should test different data segments not just on overall conversion performance, but also on metrics that will pay off a little later, once true identity-based personalization is achieved.
For example, how recent the data is, how much of the data is based on reliable search and purchase behavior, not just browsing or context. And of course, how capable that data set is at augmenting an identity strategy.
For a marketer with good first party data, adding data partners that expand their 360 degree view of their customer can also improve their identity approach.
Having an approach to data partnerships that look for verifiable information that can increase an identity strategy and expand it deeper into marketing doesn’t only increase performance, it creates a more relevant customer journey.
As more and more people have switched their shopping from in-person storefronts to digital commerce, marketers should work to unify their company’s identity strategy across teams, and look to use those insights for as many improvements in performance and customer experience as possible.
Another benefit of an identity strategy that stretches across advertising and marketing is to increase the confidence in transactions, even with new visitors.
Data that’s tied to an identity, such as location, recent purchases, use of their mobile phone, don’t just help with message targeting and personalization, it also helps with verification. Take the traveler to Hawaii.
Someone who has committed to a flight using their own identity is likely to be who they say they are, which can lower the need for other fraud hurdles (for example bypass multi factor authentication), creating a safer marketer environment, and a more streamlined customer experience.
Edward Cannon is Director of Solutions Architecture at ADARA. He is a successful IT leader with more than twenty years of experience across development, architecture, operations, analytics, ecommerce, and sales in the Travel, Retail, CPG, B2B, and Transportation industries. Eddie is an innovative patent holder that has developed and sold unique customer experience and analytics Cloud solutions for startups and multinational organizations.
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