How the Impact of COVID-19 Is Changing Marketing

Well, it’s not as if we can start 2020 all over again — we’re already halfway through this year thus far. Yet, we can say one thing, COVID-19 and its recessionary impacts may be hanging around awhile. How may this have changed marketing mid-year, and possibly changed it permanently?

Well, it’s not as if we can start 2020 all over again — we’re already halfway through this year thus far. Yet, we can say one thing: COVID-19 and its recessionary impacts may be hanging around awhile. How may this have changed marketing mid-year, and possibly changed it permanently?

Such prognostications have kept The Winterberry Group, a marketing research consultancy, plenty busy since March: reading the tea leaves of government data, industry interviews, marketing dashboards, econometric algorithms, and the like. Principal Bruce Biegel told a Direct Marketing Club of New York audience this past week that indeed June has been better than May, which was better than April — when the U.S. (and much of the global) economy was in free fall.

So what’s underway and what’s in store for us midyear? Have we turned a corner?

Our Comeback Will Not Be a U-Turn — ‘Swoosh!’

When unemployment shoots up to 17.1%, and 40 million American jobs either furlough or disappear, there’s going to be a lag effect. The “wallet” recession is upon us, as consumers hang onto their savings, or eat through them, so there’s not going to be the same level of demand that drives upward of two-thirds of the U.S. economy.

New York City is a COVID-19 epicenter — and the commercial real estate market may take five to 10 years to recover, reports The Economist (subscription required). Knowledge workers will return, eventually. But densely populated urban centers, where innovations accelerate the economy, may look and feel different for some time, and that in and of itself could hamper national and global growth. Can other innovation clusters stave off the virus to protect collaboration?

And then there’s our world of advertising. Biegel sees digital being a “winner,” as traditional media continues to take a drubbing. Linear TV spending dropped by a quarter this quarter, and direct mail by half. Experiential and sponsorship spending has been slashed by 75%, as concerts, live sports, conferences, and festivals all took a public health-ordered hiatus. Yet, even in digital categories, Q2 has yelled “ouch.”

Email is the only channel to have held its own, though pricing pressure has cut margins. Social, search, and digital display all have posted drops from 25% to 40% during the quarter — and though all our eyes were home watching Disney+, Netflix, and the like, even OTT/addressable TV ad spending was down by 5%. With the Newfronts coming this week, it will be interesting to see what types of digital media may post gains.

So if June’s “recovery” in media spend is any indication, Q3 (sans Olympics) and Q4 (yes, we’re still having an Election, last time I checked) should be solid though not buoyant. Biegel says it may be a “swoosh” recovery — think Nike’s logo — down fast, but up again slowly, steadily and resiliently. Which begs the questions: Can ad businesses, business models, and brands cope with a new reality?

The “new normal” is about coming out of the COVID-19 crisis — and half of executives surveyed by The Winterberry Group aren’t expecting miracles:

Medium-Term Budget Cuts

IAB-Winterberry Group State of Data (2020)

 Q3 Will Start a Recovery … of Sorts

Source: Advertiser Perceptions, Pivotal Research Group (2020), as reported by Winterberry Group

And, Biegel reported, that it may indeed take to 2024 — with COVID-19 firmly in a rear view mirror — for a recovery to be complete, according to IPG Mediabrands Magna. It is predicting a 4.4% ad spend contraction this year, a 4% recovery next year, and “subdued” results thereafter until mid-decade.

So How Have We Changed — and Will These New Behaviors Stick?

Some effects, though, may indeed have permanence in how Americans consume media — perhaps hastening trends already underway, or creating a whole rethink of how we act as consumers. Consider these impacts:

  • Streaming to TVs more than doubled during COVID-19 crisis. Have we rewired our video consumption habits away from scheduled programming for good?
  • Mobile data traffic surged 380% in March alone. Consumers have taken to their smartphones everywhere — so how has mobile viewing altered consumer’s screen habits across devices, and will it stick?
  • DTC brands and catalogs know all about remote selling — and so do millions of consumers who have now come to love shopping this way.
  • Video game use is up 60% — opening the door to more in-game advertising opportunities. This may change the mix of brands seeking to engage consumers there.
  • In January there were 280,000 posted job openings in data analytics. There are 21,000 today. More than half of marketers expect predictive modeling and segmentation to occupy their marketing strategy concerns for the balance of 2020.
  • Tangible value matters. Consumers will be demanding more pricing benefits from brand loyalty, and less VIP experiences. We may be getting tired of lockdowns but we are steadfast in a recession, savings conscious mindset.
  • Business travel – yes, your clients may be returning to the office, but do they really want to see YOU? What can B2B marketers and sellers achieve virtually?

It’s ironic, Biegel said, that privacy laws and the crumbling cookie are making customer recognition harder in the addressable media ecosystem, just as consumers expect and demand to be recognized. Identity resolution platforms will evolve to cope with these new marketplace realities — both of which are independent of COVID-19 – but the solutions will bring forth a blend of technologies, processes, and people yet to be fully formulated. These are still open and important marketplace issues.

So assuming we’re healthful health-wise, we have some challenges ahead in ad land. I’m glad to have some guideposts in this unprecedented time.

2020: A Big Year for Media Spend Will Underscore Data’s Role in Marketing Strategy

With the longest U.S. economic growth span on record, one might think the wheels may be about to come off of the economy — and marketing spend along with it. Not so, says Bruce Biegel, senior marketing partner at The Winterberry Group, during his annual forecast about marketing strategy.

It is the best of times.

With the longest U.S. economic growth span on record, one might think the wheels may be about to come off of the economy — and marketing spend along with it. Not so, says Bruce Biegel, senior marketing partner at The Winterberry Group, during his Direct Marketing Club of New York annual presentation, “The Outlook for Data Driven Advertising & Marketing 2020.”

marketing strategy
Source: Winterberry Group (2020), with Permission | Credit: Winterberry Group

Sure, there is caution. The Great Recession displaced many — and served to accelerate digital disruption from retail to finance to certainly marketing, forever. Perhaps businesses have never felt safe, sound, and secure ever since. One might call it “wise agitation.” And it really has been consumer spending that has served as the primary driver of growth, particularly in 2019.

Not the R Word …

Outside of business caution and flat earnings, where are the signs of another recession? They are hard to find.

Inflation and wage growth are hardly sputtering — even as the nation’s unemployment rates are at record lows. Trade rows and impeachment proceedings only appear to buoy the stock market. Even inside the world of marketing, privacy restrictions have not diminished the luster of data deployed for marketing and insight. And with the Olympics and a General Election this year, it should be times aplenty for many media channels, agencies, data providers, and tech companies — as these events are traditional hallmarks of spending.

So who are some of the winners in the current marketing and media environment?

… But plenty of D, Even Still

D, as in Direct: Biegel noted that “Buy Direct” is creating continuous rise and sale in DTC [direct to consumer] brands. The subscription economy is booming and traditional distribution channels — read, retail — continue with a “D” of their own, “disintermediation.”

“The five-year growth (through 2019) of DTC retail is four times that of the retail market revenues — 7.64% growth vs. 1.78%,” he reports.

That doesn’t translate to digital-first success, however, as such approaches are not scaling as rising costs in paid social, for example, are inhibiting customer acquisition.

marketing strategy
Source: Winterberry Group Spend Estimates (2020)

D, as in Digital: Online media spending overall grew by 19.1% in 2019 — compared with a 5.9% decline in offline media spending for the same year. Among all digital media categories in 2019, paid search grabbed the largest share — followed by display and paid social. Yet search spending “only” grew by 13.2%, compared to 21% growth for display, and 23% growth for paid social. For 2020, online media spending will continue to climb — reaching $166.4 billion in spending, while offline media will reverse its decline and post a 2.3% climb this year (remember, Olympics and Elections) to $223.1 billion.

D, as in Data: Data spending also posted healthful growth in 2019 — up by 5% — with another 6.2% growth expected in 2020. Is data working harder for marketers — as in, increasing marketing efficiency? Possibly. Spending on offline data dropped 5.5% in 2019 — while spending on email data and analytics posted 22.4% growth, and spending on digital media data and analytics (other than email) grew by 14.4%. Yet businesses are wholly satisfied with their own level of “data-centricity.” Biegel says, “Organizations are slightly more ‘data-centric’ this year than when asked in 2017 — on the whole, industry data-centricity is not progressing as envisioned.”

marketing strategy
Source: IAB-Winterberry Group Data-Centric Org (2020)

What’s Driving Data Strategy at Businesses?

Beigel reports three primary facilitators:

  • A desire to deliver better customer experiences;
  • Heightened regulatory compliance requirements and need to honor consumer preferences; and,
  • Increased demand to better leverage both first- and third-party data assets.

With a data-for-marketing marketplace in the United States now valued — both offline and online —- at $23 billion, those are three very important drivers that marketing professionals needs to get right. Or else our C-suite credibility may be diminished.

Artificial intelligence also has benefited from this reverence for data. Beigel reports that $11 billion has been invested globally in AI in the past five years — with 80% of marketers seeing AI “revolutionize” marketing in the next five years. Much of this investment is set on drawing insights from both structured and unstructured data sources.

And Where Are There Lingering Concerns?

Besides enterprise command of data assets, which could go either superbly or not, there are other concerns — both macro and micro, Biegel reports.

U.S. economic growth will likely slow to 1.9%, with global growth at pronounced risk. Corporate earnings may disappoint — leading to tightened purse strings. Tariffs may be reduced – nation by nation, region by region — but to what immediate impact? In short, Biegel says, “Limited tailwinds indicate that growth must be earned or bought.”

Among offline media there will be pockets of growth — outdoor, shopper marketing, linear and addressable TV — though direct mail will only squeak growth, with radio, newspaper, and magazines continuing their declines (even as their digital counterparts grow).

Search, display, and social will continue to dominate online media spend — but less mature channels, such as influencer marketing, digital video, and OTT [over-the-top] streaming, and digital audio will post rapid growth from much smaller bases. That portends good times for online data — but is it all rosy?

marketing strategy
Source: Winterberry Group Spend Estimates (2020)

For example, are customer acquisition and retention costs, though, declining in these channels? It may be that media inflation will eat into marketing efficiency, particularly if “targeting” data gets less precise and, as a result, relevance gets more elusive. Privacy restrictions, while well-meaning, are not always implemented in such a way that serve best consumers. Still, only 16% of businesses have reduced their spending and reliance on certain kinds of data as a result of new and potential data privacy regulations, Biegel reports.

So, come December 2020, will all of these predictions and concerns bear out? That’s one of the reasons I attend Bruce Biegel’s Annual Outlook at DMCNY each year. As great a prognosticator as he is and as on-target as his business, data, and economic models are — he’s always close enough to the market to say where struggles remain, where the work of data-driven marketing is hard, where hiccups happen, and the like. These are all of the many micro and macro reasons that any best of times can go awry.

His January 2020 predictions are now in the books — and we will all be back again in January 2021 — barring any hiccups.

Were Publishers the First DTC Brands? How 2 Areas of Marketing Align

DTC brands are hot entities. Practically any consumer product can be translated to a paid subscription business model. As a direct result, circulation and subscription marketing professionals have become very attractive new hires to the growing bevy of direct-to-consumer brands.

DTC brands are hot entities. Practically any consumer product can be translated to a paid subscription business model.

As a direct result, circulation and subscription marketing professionals — a mainstay of the direct marketing discipline for decades — have become very attractive new hires to the growing bevy of direct-to-consumer brands. In reverse, too — publishers are enriching their content offerings for their customers in service to them, acting as DTC brands, themselves.

That was a main thrust at a recent joint meeting of the Direct Marketing Club of New York and The Media and Content Marketing Association. The joint meeting, titled “What DTC Brands and Publishers Can Learn from Each Other in Today’s Subscription Economy,” allowed publishers to exchange ideas with DTC brand reps and others.

DTC brands meeting
Source: DMCNY, Twitter @dmcny | Direct-to-Consumer Brands, Publishers and their Admirers exchange perspectives around customer value and experiences.

“Magazines are the original DTC,” said Mike Schanbacher, director of growth marketing at Quip, a subscription business for toothbrushes and dental care,. He noted that traditional circulation metrics, such as lifetime value and churn rates, very much factor in the business and marketing plans of a subscription commerce company.

Alec Casey, CMO of Trusted Media Brands Inc. (TMBI, which manages 13 brands, among them Reader’s Digest), described how his business continually explores expansion of product and content — to books, book series, music and video — and potentially podcasts and subscriber boxes.

“We are always DTC,” he said, meaning that customers’ interests drive every brand extension in the company.

Data can reveal interesting patterns, he noted. Visitors to Family Handyman digital content is 50% men, 50% women, for example, while print content is dominated by men.

DTC Is High-Speed

One hallmark of the newest DTC brands is velocity.

“When bananas and avocados are sitting in the warehouse beneath you, there’s urgency,” said Tammy Barentson, CMO of Fresh Direct, who previously had had a lengthy career in publishing with Time, Meredith, Hearst, and Conde Nast. Innovations are sought for and tested constantly … and rapidly: “There’s a mindset here … ‘That bombed. What did we learn?’’ ” she said, which is a marked change from her previous publishing posts, where testing was more considered.

Barentson also noted that the Fresh Direct executive team meets every morning to listen in collectively on each department’s dashboard of metrics — and that can inspire action.

“There’s a lot I can learn from operations and customer service data,” she said. “For example, how many deliveries are made per hour might tell me geographies where I might focus more customer acquisition.” Her own team pores through subscription data — who orders groceries one, two or three times a week, or just for special events — “how do we bring them up the food chain?” she quipped.

One of the first publishers to capitalize on digital was Forbes and Forbes.com, said Nina LaFrance, who is Forbes’ lead for consumer marketing and business development. Today, the corporation’s digital sites generate 80 million unique visits per month — but it’s the drill-down on the data that is perhaps the most exciting, enabling Forbes to help advertisers connect with customers across print, digital, programmatic display, brand voice, social channels, live events, apps, webinars, and more. Forbes has its own in-house studio to help brands develop content for marketing across the portfolio.

“We adapt and embrace,” LaFrance said, responding to the all the challenges and opportunities presented to publishers and DTC brands alike — issues, such as coping with “walled gardens,” tech giants, privacy laws, data restrictions and regulations, and the Cookie Apocalypse.

Communities Are Sticky

A common theme expressed by the panel was the desire to create a sense of “membership” and “community” — going beyond the transaction to create “stickiness.” That’s where content development matters. “

At Quib, we try and give a membership feel,” Schanbacher said. “Data is the goal,” noting the better consumer understanding and insights that come from content engagement, data collection, and analysis.

However, not every piece of content translates equally to profit, LaFrance reports.

“Visitors to our home page, or who respond to direct mail, may be more profitable to us than those who link to an article from a social post,” she says — and the ability to measure that customer value across channels is a success, in its own right.

Which is probably the most valuable insight of all. These professionals — DTC brands and publishers — revere how data serves, bolsters, and builds the customer relationship, and they have all pursued a shared culture for measurement, insight, and application to build the brands, build the business, and connect to consumer experience. As subscription commerce grows — it has doubled in the past five years — we know how invaluable such data reverence can be.

Toasting 2018 Silver Apple Honorees: In Their Words

You might have heard of a big event that happened last week in the USA. No, not THAT one. I’m talking about but the presentation of the Direct Marketing Club of New York’s 2018 Silver Apples honors. Here’s more about the awards, from the Silver Apple honorees themselves.

Silver Apple Honorees ballroom
Photo Credit: Edison Ballroom via DMCNY, 2018

You might have heard of a big event that happened last week in the USA. No, not THAT one. I’m talking about but the presentation of the Direct Marketing Club of New York’s 2018 Silver Apples honors. Here’s more about the awards, from the Silver Apple honorees themselves.

The Silver Apples recognize leadership, stewardship and business success mid-career in the data, direct and digital marketing field. Each honoree has (more or less) 25 years of experience, with matching achievements to point to … and all have additional contributions to our industry, community, mentoring and giving back.

With the assistance of newly named The Drum U.S. Editor Ginger Conlon, I thought it worth amplifying a few key industry insights shared by this year’s individual honorees:

Anita Absey, Chief Revenue Officer, Voxy (New York):

Favorite Data Story: “Back in the very early days when I was at Infobase, we were doing data overlays on customer databases, which was novel at the time. While working with a large insurer, doing overlays of demographic and socioeconomic data on their database, the profile and segmentation scheme that emerged from that work actually defied some of the assumptions that they had about the characteristics for their customers’ profile. The insights we provided them helped them make subtle changes in their communications and targeting to customers, which improved the overall risk profile of their customer base. It was gratifying to see how data could affirm or deny assumptions and enable our client to make decisions that helped improve the risk profile of their business.”

Measurement: “Hope is not a strategy. Your actions have to be data-based, not hopeful. Similarly, you can’t manage what you can’t measure. Unless you have data that points you to the actions and decisions that are best for the business, you’re running blind.”

Matt Blumberg, Co-Founder and Chief Executive Officer, Return Path, Inc. (New York):

On Choosing Marketing: “The thing that drew me to marketing was the Internet. I had been working as an investor at a venture capital firm that invested in software companies. Once Netscape went public and people started figuring out the short- and the long-term potential of the Internet, I got very excited about working in that field. Unbeknownst to me at the time, the Internet is all about direct marketing. For the first several years of my career, I would never have described myself as a direct marketer; but in hindsight, obviously, I was.”

On Inspiration: “It’s several sentences out of a speech by Theodore Roosevelt called ‘The Man in the Arena.’
It’s incredible. It goes:

” ‘ … The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.’

“I take it as the entrepreneur’s motto. It’s a beautiful passage that I have taped up everywhere.”

Pam Haas, Account Director, Experian Marketing Services (Providence, RI):

Overhyped: “Display and programmatic technologies are overhyped. It’s like the early days of email marketing: People just started sending millions of emails, hoping some would stick. The same thing is happening in display and programmatic. That part of the industry still needs to mature.”

Best Metric: “Right now, it’s the ROAS: Return on Ads Spent. I love that. For every dollar that the client is spending, we know that we are driving X number of dollars in sales.”

Career Advice: “Diversify. In marketing, there are so many different angles and specialties that you can focus your career on. Throughout my career, I’ve [been] able to gain experience in multiple facets of marketing: direct response, email technology, and in databases and modeling. Digital is so sexy right now, but the fundamentals still apply; so it’s important not to pigeonhole yourself into one area.

“While in a mentor program at Equifax, my mentor was a woman and she told me, ‘You have to be your own PR person. You have to make your accomplishments known, because nobody else is going to do that for you.’”

Keira Krausz, EVP and CMO, Nutrisystem, Inc. (Fort Washington, Penn.):

On Her Current Assignment: “I’m proud of where we are at Nutrisystem and I’m particularly proud of what we’ve built as a team. Our job is wonderful, because we get to help people live healthier and happier lives. Since 2013, we’ve nearly doubled the business, which means we’ve helped a whole lot more people get healthier and happier. Along the way, we’ve revamped nearly every aspect of our business that you can think of, and we’re just getting started.”

On Mentoring: “In my first years in marketing, I was always being asked what my goals were and how I saw myself in years to come, and I always felt flummoxed, because I didn’t know what to say. I wasn’t one of those young people who had their whole life planned out when I was 25, and I often felt insecure about that. But it turns out that was OK.

“So, one thing I did that I would advise is, from early on, try to work for someone you can learn from. Somebody who you admire, who has something unique, and who can teach you something that you think you’re missing. The rest will fall together.”

Tim Suther, SVP and General Manager, Data Solutions, Change Healthcare (Lombard, Ill.):

On Career Choice: “I’ve always been technology-oriented, from learning to code when I was 17 to graduating college with a finance degree. With that background, naturally, I was suspicious of marketing. A lot of marketing felt inauthentic and superficial to me. But I had this one moment where I actually saw a dynamic gains curve for the first time and I thought, ‘Oh my god, this is one of the most interesting things I’ve ever seen.’ It was the intersection of the art of marketing and the science of data that really drew me in; and boy, did I get lucky on that one, because that’s what it’s all about today.”

On Being Data-Driven: “This might surprise you a little bit, but it annoys me when marketers say that they’re data-driven, because that’s like saying, ‘OK, it’s time to turn off my brain and just let the data drive the story.’

“I think marketers are far better off when they are data-informed, where they’re combining what the data is telling them with their own business judgment to make the right decision. Human behavior is still too complicated to purely reduce to what an algorithm tells you to do; it has to be a combination of what the data is saying, creative savvy and business judgment.”

This year, DMCNY added two special awards not tied to mid-career, but recognizing two huge drivers in our business today: advocacy and disruption. The inaugural Apples of Excellence 2018 honorees include:

Advocacy:

Stu Ingis, Chairman, Venable LLP (Washington, D.C.):

On Policy-Making: “The whole privacy concern is overhyped. What’s not getting its fair recognition, in the policy world, is all of the innovation that the marketing community brings to society. For instance, they’re bringing real-time targeted marketing to television and delivering marketing communications that consumers are interested in on a personalized basis.”

On Careers: “Take the long view. Work really hard; don’t worry about the compensation or the glory, and then persevere. Stay with it. Don’t switch jobs all the time thinking that something else is always better. If you develop your skills, the good work will come to you. You don’t have to go to it.

“I’d been representing the DMA for about two years, and I had an opportunity to leave the law firm and go out in the early Internet age at Yahoo!

“Yahoo! stock was going up. I would have made millions of dollars a day. I went to Ron Plesser and said, ‘I like working for you; I like the clients; I like the work I’m doing. But I could go get really rich working for this company.’ He said, ‘Why do you want to do that? It’ll ruin your life.’ For whatever reason, I actually believed him and agreed with him. And I stayed at my job. It was probably the best decision I ever made. I don’t regret it for a second.”

Disruptor Award, Presented by Alliant:

Bonin Bough, Founder and Chief Growth Officer, Bonin Ventures (New York):

About Bonin: “His unique approach of applying innovative technology to create breakthrough campaigns helped to reinvigorate traditional marketing brands, such as Gatorade, Honey Maid, Oreo and Pepsi.

“But his influence doesn’t stop there. Bonin believes in supporting young talent and savvy entrepreneurs. While at Mondelēz International, for example, he created internal programs to mentor young talent and launched a startup innovation program, Mobile Futures, to provide a platform for marketing-tech and agency start-ups to work with the CPG giant.

“Stephanie Agresta, global director of enterprise growth at Qnary, describes him best in her recommendation on LinkedIn: ‘Bonin is a force of nature … A true rockstar from Cleveland to Cannes, Bonin has been [at] the forefront of the digital revolution from the beginning. Smart, successful, and connected, Bonin has the pulse on what’s next. Those that know Bonin well can also attest to his generosity, commitment to mentorship and a deep belief that anything is possible.’”

Since I had the privilege of interacting with Bonin at DMA &Then18 recently, I can attest the walls fall away when you converse with him. Disrupted, indeed.

All of these honorees as well as corporate recipient Winterberry Group have many things to teach us. That’s why it’s important we continue to recognize these business leaders, as marketing today, as Matt Blumberg says, is a 100 different things. It’s the business outcomes that matter.

Thank You, Arthur Blumenfield, Joyful Storyteller

This past week, we bid farewell to a gentleman and a marketing pioneer, Arthur Blumenfield. For those of us in the New York marketing community, who revere data and data-driven marketing and media — as well as the camaraderie of our community — Arthur truly was a leading light.

This past week, we bid farewell to a gentleman and a marketing pioneer, Arthur Blumenfield.

For those of us in the New York marketing community, who revere data and data-driven marketing and media — as well as the camaraderie of our community — Arthur truly was a leading light.

Arthur was full of stories, and he was a masterful storyteller. He was also joyful, and one couldn’t help feeling the warmth when you were with him. One of my favorite stories was a visit he had taken to Jerusalem, where the locals told him to get a room at the Yimcah Hotel. Up and down he rode the bus route, having to remind the forgetful bus driver a couple of times to drop him off at the stop nearest to the hotel. Peeling his eyes along the route, looking for the hotel — back and forth, as other riders jumped in to say the bus had passed the hotel. Really? Finally, when he actually had the correct stop, he exited the bus and wandered about, finally discovering the Yimcah Hotel, otherwise known as the Y-M-C-A.

That was it, you never knew if it was urban lore — or a true experience. But it really didn’t matter, it was Arthur sharing a tale, and earning a laugh.

He loved his regular OGLE meetings — Old Guys Lunch Experience. Last summer, I received a coveted invitation.  And Arthur truly had a plan for inviting me there. There were plenty of folks in our field — with wisdom a-plenty — with their own stories to be told, and shared. He shared with me Eddy Boas’s book, “I’m Not a Victim, I am a Survivor — how one of our industry’s own endured the Holocaust in a camp with his family, only to survive, rise and build a career in Australia and beyond as a direct marketer. Arthur’s career crossed paths with many such personalities, most of them colorful like himself.

His accomplishments professionally preceded him:

  • He invented the de-duping processes for mail data files, as well as “Me-Books” — that’s personalized print and storytelling coming together;
  • He served as longtime treasurer for the Direct Marketing Club of New York, earning both Silver Apple (1994) and Golden Apple (2013) honors. The company he founded, BMI Global OMS, a family business, was a Silver Apple corporate honoree itself last year;
  • He was a founder of Direct Marketing Days of New York;
  • He cared deeply for the education mission of DMCNY — and our collective support for the future of our field;
  • He developed an order management system first used by the Direct Marketing Association (now Data & Marketing Association) for its conferences; and on and on.

He loved his craft, he loved our field, and loved most of all his family — husband, father, grandfather.  You know when you were invited to a summer outing in Easton, Conn., it was an extended family affair.

Thank you, Arthur, for your warmth, stories and achievements — all of which you so readily shared. We are all the better for it, and — in your spirit — I’m hopeful that any of us can pay it forward at least half as good as you did, with that ever-present smile. That would be remarkable.

In My Mailbox & Yours | An Artful Invite to a Special Evening

It’s my favorite mail piece this year — and it didn’t even include a check.

direct mail
Credit: Chet Dalzell

It’s my favorite mail piece this year — and it didn’t even include a check.

But it did include an invitation for payment. You may have received it, too.

Late next week (Nov. 16), 300-plus marketers will gather in New York for the 2017 Annual Gala Evening, the presentation of the 33rd Annual Silver Apples Awards. There, we pay homage to marketing leaders who have given 25 years (at least) of distinguished service to our field.

[This year’s Silver Apple honorees are Fran Green, ALC; John Princiotta, PCH; Eva Reda, American Express; Randall Rothenberg, IAB; Jay Schwedelson, Worldata; Rita Shankewitz, Bottom Line, Inc.; Corporate Honoree BMI Global OMS; and special Golden Apple Honoree Stu Boysen, Direct Marketing Club of New York (DMCNY).]

It is a fete. It is New York’s data, digital and direct marketing’s annual night out. You even see a national audience there.

But what I want to talk about is the marketing effort for the event this year. Each honoree is remarkable in his or her own way, which is why I really appreciated this year’s marketing campaign executed by DMCNY volunteers and partners.

Since on or about Labor Day, I — and a few thousand others like me — received a customary “Save the Date” email and the news announcement of the winners, first announced collectively. [Disclosure: I prepped the news release.]

But this year, we were introduced individually to each of the honorees, in a short email every 10 or so days, which gave a little bit of biographical color — personal and professional — on each honoree. The single honoree-focused digital effort culminated in a colorful direct mail invitation with a reply card and envelope, and a protected film envelope, which had each photo of the honorees in a frame. The backside of each framed photo included their career highlights.

The art is outstanding — somewhat reminiscent of Pollock or Calder — which I can appreciate as we celebrate somewhere between MOMA and the Whitney (Edison Ballroom, to be exact).

I often think about when is the right moment for print, a moment for mail, amid our increasingly social-digital-mobile lives. Physically receiving, opening and touching an invite still feels special to me, and I do think it elevates the “weight” of the honor we will be celebrating, and the important contributions these professionals make. While the gala itself will serve as the climax, I did find the mail moment here to be an exciting precursor — and well-timed, following the wave of individual honoree-focused emails, and just ahead of the last-minute digital reminders and follow-ups. Not every creative element was new in concept, but they were certainly fresh in concert.

Well done, DMCNY. As a past honoree, I am blessed to be able to say “thank you.” As I think about the upcoming week, I can say we’ve raised the curtain to this year’s honorees with elán and spirit — one I’m hopeful carries through the experience of the event.

See you next Thursday in New York.

[Credits for the DMCNY Silver Apples marketing effort go to several folks, including: Invitation & Program Cover Design: Robert Snow of Robert Snow Marketing Communications; Invitation Printing and Mailing & Program Book Printing: McVicker & Higginbotham; Program Booklet Design: Cheryl Biswurm, Turner Direct LLC; Email Design and Execution: Briana Kovar and Carolyn Lagermasini, Association & Conference Group; as well as an entire Silver Apples Planning Committeeso you’ll need to be there presently to give them all kudos.]

Billion-Dollar Baby: Customer Data Onboarding

Last week, Bruce Biegel, senior managing director of Winterberry Group, led a Direct Marketing Club of New York discussion on “customer data onboarding.” It’s the process of linking offline data with online attributes (cookies, IP address, device IDs, non-cookie identifiers, among other identifiers) in order to perform any number of marketing use cases, what often is referred to as “data activation.”

This blog post opens with a 2014 local TEDx talk of Dr. Charles Stryker, who left us unexpectedly last month. To say the least, “Charlie’s” legacy as a data innovator, business leader and financier is very much alive, well and profound.

Dr. Stryker truly set a stage for what has transpired three years hence — and likely decades to come.

Last week, Bruce Biegel, senior managing director of Winterberry Group, led a Direct Marketing Club of New York discussion on “customer data onboarding.” It’s the process of linking offline data with online attributes (cookies, IP address, device IDs, non-cookie identifiers, among other identifiers) in order to perform any number of marketing use cases, what often is referred to as “data activation.”

These use cases for customer data onboarding most often include (but are not limited to) digital display targeting, “walled garden” targeting (such as ad targeting inside social media platforms), consumer analytics and insights, measurement and attribution, site personalization, and addressable television and online video targeting. (Readers, please don’t confuse customer data onboarding with customer onboarding — they are not interchangeable.)

Winterberry Group estimates this market to exceed $300 million today — but may eclipse $1 billion by 2020.

“Consumers are constantly connected,” Biegel said, noting each connection can generates volume and variety of data. “Today, the average consumer uses close to eight connected devices per day. One of my colleagues counts 22 connected devices!” Such connectivity generated close to 44 zettabytes of data in 2016 — and should more than quadruple that data generation to 180 zettabytes by 2020.

How do we structure these data to help recognize that customer from device to device in privacy responsible ways — to enable all these vital use cases? The answer, customer data onboarding.

Certainly, the big driver of customer data onboarding is brand engagement — all those use cases demanding customer identification and data quality to enable 1:1 prospect and customer communication. First-party data (a brand’s own data on its customers) needs supplemental third-party data (read, ad tech and data providers) to complete the customer view across connected devices, enhanced by offline data (often transactions).

Joining Biegel were panelists Anneka Gupta, co-president, LiveRamp; Kevin Whitcher, VP for product, Oracle; and Paul Chachko, CEO, Throtle — all of them representatives of distinct industry players in the customer data onboarding space.

In onboarding’s nascent days, according to the panelists, brands may have matched 5 percent to 10 percent of their offline-digital customer file — but today, such match rates have grown to 50 percent or more, depending on the device (mobile versus laptop, for instance), helped by more deterministic (certain match) and probabilistic (likely match) means for identifying unique individuals and households.

“Never trust a vendor who claims a mobile match close to 95 percent,” Chachko said. “Probably the best upper match rate we have [in mobile] is 75 percent.”

With individuals changing devices all the time, adding new ones and retiring old ones, moving inside and outside login environments, adding new email addresses while not necessarily discarding old ones — all of these data points help to inform a “consumer ID graph” that is increasingly person-specific (rather than household), according to the panel.

“It used to be [data onboarding companies] used these graphs to facilitate the data matching inside their operations,” Oracle’s Whitcher said. “Now more and more clients want to access and use the graphs themselves — it’s a new product offering in and of itself. … It all comes down to what does the brand want to do? Digital display targeting is the most common use case — but more marketing uses are emerging, such as attribution.” Mixed media attribution models are becoming more common.

In omnichannel marketing environments, CMO’s know that last-touch attribution falls short when consumer paths to purchase are so varied.

LiveRamp’s Gupta noted that addressable television is also gaining advertiser attention, but online video targeting is a very hot use case now.

As bullish panelists are toward customer data onboarding’s growth, not all brands are ready for the discipline of such data enhancement. “Global brands must worry about privacy rules, particularly in Europe,” Whitcher said, where European Union General Data Protection Regulation and ePrivacy Regulation loom.

Closer to home, many enterprises are not yet realigned around customer experience. Data siloes by channel, and by product, interfere with a full customer view — and these siloes must be broken before data integration and quality regimes — and the insights they produce — can be applied.

“Retail and financial services are perhaps the most mature adopters of customer data onboarding, largely because they were the earliest to invest in whole-customer views,” Gupta said.

Whitcher concurred on retail — noting that competing with Amazon has spurred all types of data innovations. He also noted that auto, travel, media and entertainment, and consumer packaged goods are also fast-rising in data onboarding use. “Not all sophisticated marketers are sophisticated data users,” he said.

“When we see clients fail, it’s because they bite off more than they can chew,” Gupta said. Data science requires testing, proof of concepts, data quality and rollout testing — all practices very familiar to traditional direct marketers, but not necessarily mass-market brands.

Still, the billion-dollar market is gaining steam — just like Charlie said it would.

Note: Also see from January 2017, “Customer Data Onboarding: Winterberry Group Publishes State of Market.”]

Will Ad Spending Really Be ‘Sluggish’ in 2016?

I was surprised as anyone to see reports last month from GroupM that ad spending may only muster modest growth of 4.5 percent in 2016 — after 4.3 percent growth this year. I’m not an economist, but it’s hard to fathom that that’s all we can expect. But then again…

Image: Shutterstock
Image: Shutterstock

I was surprised as anyone to see reports last month from GroupM that ad spending may only muster modest growth of 4.5 percent in 2016 — after 4.3 percent growth this year. I’m not an economist, but it’s hard to fathom that that’s all we can expect. But then again…

Usually, years of Presidential Elections and Summer Olympics are boon years for advertising, certainly here in the U.S. Taken together with continued U.S. economic growth and China stabilization, if ad spending is only going to grow this slowly, one must ask what’s holding it back?

According to the report, television advertising in the U.S. is competitive — meaning there’s softness in the market. This is primarily because eyeballs are migrating to digital, video streaming and mobile devices, at the expense of television — eMarketer records more than 5 hours of a day spent on digital channels, and just four hours on TV. Globally, however, TV is resilient in strength.

GroupM also reported that 90 percent of ad spending growth is in digital – which now comprises 30 percent of global ad spend, compared to 19 percent in print media.

Perhaps, sluggish may be the new normal — as media shifts continue to flow in fits and starts. 2016, with all the traditional bolsters for U.S. ad spending in place, should really show if there is indeed a less bullish norm.

In two weeks, before the Direct Marketing Club of New York, The Winterberry Group will present its forecast for U.S. media spending – including general, direct marketing and, within direct, digital media spending. I’ll be there taking notes!

To Thank an Industry (or a Method of Marketing)

On Nov. 12, more than 300 colleagues in our field gathered at the Direct Marketing Club of New York’s 31st Silver Apples Gala. I am humbled to be a 2015 recipient.

On Nov. 12, more than 300 colleagues in our field gathered at the Direct Marketing Club of New York’s 31st Silver Apples Gala. I am humbled to be a 2015 recipient. Let me find a way to say “thank you” in this blog post — by prefacing these remarks with an echo from Direct Marketing Association Hall of Famers and industry advocates Pete Hoke and John Yeck, who would have corrected my headline: “Direct marketing is not an industry — it’s a method of marketing used by all industries.”

And so it is.

What a night to be honored, especially because the “Father of Direct Marketing” Lester Wunderman received a rare “Golden Apple.”

My Mom always dreamed I’d get a job hosting on QVC. Mom, you just never know, no one knows, just what’s next for Chet Dalzell. Instead, I wound up at DMA, Harte Hanks and Digital Advertising Alliance — plus freelancing for a host of DM leaders — and in this dynamo of a city, in this fascinating marketing discipline, I truly found a home.

When we look this year’s honorees, and the entirety of the Silver Apples honorees since 1985, these are movers and shakers in the marketing. These are people who have defined this business, exemplified leadership and shown us how to give back. They are my colleagues and my clients, they are our innovators and teachers. I am only around to amplify their messages.

I learned that in looking for a great job, you look for a great boss and a great client. I’ve had them all, in Jonah Gitlitz and Connie LaMotta (DMA), in Richard Hochhauser and Mitch Orfuss (Harte Hanks), in Lou Mastria (Digital Advertising Alliance) – and in marketing leaders such as Liz Kislik, Rick Witsell, JoAnne Dunn, Peg Kuman, George Wiedemann, Terri Bartlett and — of course — my blog editors at Target Marketing. Through these wonderful individuals, you wake up and realize that the best boss in the world is yourself.

There are plenty more I love and adore in my professional and personal life — and there’s no justice in trying to include them all by name. Instead, let me pass on a few pearls I’ve learned from them, and see if the necklace fits:

  • Get up every day and smile. Just being on the journey gives you gratitude. And with a smile, gratitude can be shared.
  • Think of everyone as an individual, and walk a mile in his shoes — and five miles in hers. Feel her joy and pain. See what life could be like.
  • Listen to that little boy or girl inside, every day — and act on what he or she has to say. When we were in kindergarten, we all raised our hands when the teacher asked if there was an artist in the room. Somehow, many of us forgot how to express ourselves creatively.
  • Patience, kindness and love wins the race. If you’re employing other means to get ahead, choose another race.
  • Live to learn — and be the dumbest person in the room. In other words, surround yourself with people who share their intelligence, and never stop asking them how and why. (Oh, and read The Economist.)
  • Standing still breeds crisis. Instead keep asking “what’s next?” And prepare.

To my New York family — from friends, to clients, to leaders in this field — I “thank you” for keeping me around. I love you and this life you’ve made possible, to which my own personal family says thank you, too.

Mr. Wunderman, look what we’ve done to your song.

Attribution and the ‘Mail Moment’ in the Multichannel Mix

At its Sept. 13 meeting, the Direct Marketing Club of New York hosted an engaging panel discussion regarding the use of direct mail in a multichannel world, and the panelists included representatives from Citigroup, Gerber Life and The Agency Inside Harte-Hanks. … Hearing from two financial service brands, and an agency that services brands in several markets, packed the house. I’m not sure if it was the topic or the brands who spoke, or both, that was the draw—but the information imparted prompted lots of audience interest and questions.

At its Sept. 13 meeting, the Direct Marketing Club of New York (DMCNY) hosted an engaging panel discussion regarding the use of direct mail in a multichannel world, and the panelists included representatives from Citigroup, Gerber Life and The Agency Inside Harte-Hanks.

The representatives included Linda Gharib, senior vice president, digital marketing, for Citi’s Global Consumer Marketing & Internet division; David Rosenbluth, vice president, marketing, Gerber Life Insurance Company; and, from the agency side, panel moderator Pam Haas, who is both vice president, sales, for agency services at Harte-Hanks (and first vice president for DMCNY), and Michele Fitzpatrick, senior vice president, strategy and insight, The Agency Inside Harte-Hanks.

Hearing from two financial service brands, and an agency that services brands in several markets (tech, consumer package goods, automotive, insurance, pharma and more), packed the house. I’m not sure if it was the topic or the brands who spoke, or both, that was the draw—but the information imparted prompted lots of audience interest and questions.

First, customer acquisition—at least in the financial services area—still appears to be very dependent on mail. At Gerber, Rosenbluth said, as many as a third of new business policies are still generated by direct mail, even as the brand is “omni-channel”—digital (including web site, search, display ads, email), direct-response television, as well as direct mail. For Citi, the brand is positioned No. 2 in the nation by Target Marketing in its “Top 50 Mailers” ranking for 2012 (which is ranked by overall revenue, not mail volume), Gharib said, solidifying its importance in both acquisition and retention.

Fitzpatrick agreed, noting that in financial services, where marketing is modeled most precisely for risk and performance, direct mail remains an acquisition workhorse, particularly on new product launches. For automotive and pharma verticals, however, where as much as 80 percent of transactions are researched anonymously beforehand online, digital media is used for hand-raising, and direct mail may be then used to deliver a brochure of other information in a highly segmented way to close the deal. “Consumer preferences [for media] are situational,” Fitzpatrick said.

Who gets credit for attribution, when a multichannel communications mix produces a desired response? At Citi, Gharib said, such discussions are a “work in progress,” where the final interaction point currently gets the credit, whether that is chat, direct mail, email or some triggered communication. Adding to the multichannel attribution discussion is the mix of advertising purposes—some are pure branding messages, while others are intended to elicit a response, but both may compel or influence customer behavior in some discernible (or indiscernible) manner. Hence, there is complexity in the attribution discussion.

Yes, indeed, says Rosenbluth, where “allowances” are given for each channel in regard to the brand’s most importance metric to manage: total costs to convert a policy. Currently, “last touch” gets the attribution on response, but the policy conversion metric is the bigger-picture measurement, where everyone gets to take some credit.

Fitzpatrick pointed to recent Forrester research where “fractional attribution”—first touch, mid-touch and last-touch on the path to purchase share credit—and “engagement” is modeled, rather than response (alone). Every brand should undertake a channel impact study to determine, as best it can, the impact of incremental sales as a result of a multichannel customer experience, while also researching receiver reaction research. Clearly, direct mail, email, chat and other channels can be both or either “conversation starters” and “conversation extenders,” but analytics is the only way to know the role of the channel for any given customer.

“There’s credibility in paper,” Gharib remarked, “that helps with both the brand and its consideration.” Where email is cluttered, direct mail largely is not.

At Gerber, Rosenbluth, there really is no brand spend, all market spending is intended to produce engagement.

Fitzpatrick sees almost all “below the line” spending getting a branding blend—branding and direct marketing have come together. All the panelists agreed: it’s really about the consumer experience across channels, and having a database that enables customer recognition and a full customer view. Having tons of data is not enough—it’s having technology and processes in place for customer data integration and analytics to create smart engagement rules.

The verdict? Direct mail is and will remain a vital part of the media mix—because it’s an anchor in the consumer’s experience and brand consideration mix. As digital gets more clutter, boy that mailbox is looking pretty.