30-second summary:
Pre-pandemic, marketers could make some safe assumptions about how their customers lived and what interested them most based on their available first-party data.
That’s no longer the case. Today, brands and publishers are missing key parts of the consumer profile if they rely on historical first-party data alone.
First-party data should absolutely be a priority for marketers because of its relevance and quality. It helps businesses understand their target audience better, locate missed opportunities and create innovative personalized strategies to increase ROI.
On the quality meter, data providers who are reputable won’t hesitate to share with you where the data came from, how it was collected, and more. Do your due diligence but don’t shy away from the power of third-party data because of a few bad apples.
To understand what consumers’ lives really look like now, marketers must pandemic-proof their data assets by combining them with second- and third-party data and working with partners and industry organizations like the IAB and the Partnership for Responsible Addressable Media that are actively building for the future, not looking to the past.
First-party data is a great start but not the end-all, be-all
Collecting first-party data is the foundation of a smart marketing practice. A brand or publisher’s first-party data can reveal that a person is male, from Manhattan and listens to news podcasts on his drive to work every morning.
Pre-pandemic that profile helped marketers begin to understand who their best customer or future best customer is.
But that profile was always somewhat incomplete and let’s be honest, biased, as it’s defined by the parameters of a marketer or publisher’s experience with that consumer and not how that consumer operates everywhere else.
What that first-party data doesn’t tell you today is that he’s moved his family to a house in upstate New York to ride out the pandemic and that he’s juggling working from home while home-schooling his grade school aged kids.
Furthermore, he’s shopping completely online to avoid any risk, and is tuning out the news because he doesn’t have time to dig into it anymore. These are all relevant pieces of the puzzle that are missing in a brand or publisher’s consumer profile if they rely on first-party historical data alone.
First-party data should absolutely be a priority for marketers because of its relevance and quality. It helps businesses understand their target audience better, locate missed opportunities and create innovative personalized strategies to increase ROI.
But even before COVID-19, first-party data couldn’t provide the scale and depth of consumer understanding that marketers need to get a full picture of who their audience is.
Significantly, it’s nearly impossible to know what information they are missing. Without a full picture, marketers risk missing out on sales from their current customers and prospects and, unfortunately, competitors who have access to those blind spots can swoop in to steal potential revenue.
For example, one of our agency partners discovered that their client was missing connecting with a huge revenue-generating fan base when they just relied on first-party data.
Along comes second- and third-party data to broaden the view
Once the client I mentioned before added supplemental data to enhance their customer profile, they were able to convert on a previously missed revenue opportunity! Much like this client, marketers rely on second- and third-party data to fill in the gaps and enrich their personas.
As consumer behaviors and lifestyles change — especially amidst COVID-19 — marketers will increasingly rely on high-quality data to get closer to customers and understand their shifting pain points.
You might be thinking, is third-party data actually privacy compliant and high quality? In Europe, it must be compliant due to GDPR. The U.S. is catching up, albeit state by state, but very soon privacy regulations are going to become the norm.
On the quality meter, data providers who are reputable won’t hesitate to share with you where the data came from, how it was collected, and more. Do your due diligence but don’t shy away from the power of third-party data because of a few bad apples.
Don’t abandon audience data: Contextual isn’t the answer
Maybe you’re still skeptical about using supplemental audience data. With third-party tracking challenges, everyone was already talking about contextual targeting as the new advertising industry solution.
With this, marketers would use the first-party data they have available to show ads based on what pages the person is visiting, what their interests are, and what their intent is.
While this does sound like a good solution, especially during a pandemic where everything is in flux, it’s unlikely that contextual will actually replace audience-based targeting.
Everything old is not new again. The industry has moved light years ahead to embrace people-based marketing, enhance precision, and deliver more meaningful advertising. Don’t throw the baby out with the bathwater by abandoning audience targeting in favor of contextual alone.
Without cookies, device IDs or other identifiers, contextual will struggle with scale, frequency capping and, most importantly, measurement, which is critical to attract spend from advertisers, especially now.
Why? Because it only accounts for that company’s first-party data. We need identity solutions and audience targeting to help marketers understand consumers and engage them responsibly and relevantly during the pandemic and beyond.
Speaking of responsibility, it’s time for the industry to step it up
Let’s agree to “cancel” fearmongering. Digital advertising is facing some serious challenges. There’s no doubt about it. But true creativity and innovation always find a way to lead us forward.
We have a responsibility as an industry to come up with new ideas that push the envelope on quality and precision and consumer experience.
If we believe in the promise of an open Internet, we owe it to consumers to do the hard work to support the diverse content they’ve come to know and appreciate.
What can we do to increase the accuracy and precision of our data, to deepen our understanding of the consumer while respecting privacy choices, to deliver meaningful experiences on every device, platform and channel?
Returning to the past can’t possibly be the answer. We simply can’t afford to go back. The world is moving too fast for us to grow complacent or comfortable living in the past. I, for one, am energized by the road ahead of us.
I challenge each of you in digital advertising to ask the “why not / why can’t we / what if we tried?” questions and then follow through on the work to innovate and create a future we can be proud of.
Eight months into the global pandemic, many brands and publishers are fighting just to keep their businesses open. In this harsh new reality, having a clear understanding of who your customers currently are can mean the difference between survival and closing down.
Things have changed in ways that simply aren’t going to be captured by first-party data alone.
To understand what consumers’ lives really look like now, marketers must pandemic-proof their data assets by combining them with second- and third-party data and working with partners and industry organizations like the IAB and the Partnership for Responsible Addressable Media that are actively building for the future, not looking to the past.
Ruby Brenden is the Head of Data Products at Lotame. She takes a creative approach to product development and is passionate about reaching the right audience to make advertising matter. Ruby has a panoramic view of the industry, gained through her experience leading product development in the Measurement, Advertisers, and Agency landscape at such companies as Havas, Media Group, AppNexus, and Comscore.
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Source: ClickZ
Link: What marketers can do to pandemic-proof their data assets
