Consumer Marketers, Looking to Test New Data Categories? Try These

We are all trying to create and sustain customers, using data to discover new patterns, new audiences, and new prospects — and that requires a lot of testing, and innovative data sets to explore (responsibly). Let’s make it experiential, as well as experimental.

We in the data marketing business love to test — at least, we should. And what we should test for is new data categories.

Expanding the marketing universe — and stretching the marketing budget — depends on higher efficiency in our lists, offers, and creative. We should be eager to test new proofs of concepts and new categories of data sources as they enter the market … if only to know whether or not they produce incrementally or otherwise.

I’m still surprised when I hear some of my data-vendor friends say that a good number of their clients pass on testing — and just go all-in on new lists and data sources. It seems like testing is still too much work for some, or they feel the only way to test is with an entire data source. Guess these client-side folks have money to burn, or are operating very much on-the-fly.

In some ways, digital marketers have it all over offline marketers in their ability to test, cycle, test again, and so on — often, many times over by the time a direct mail or direct-response print or broadcast test cycle has run its course. Yet, in this speed, have we sacrificed some quality in our prospecting strategies?

Online audience algorithms can produce some highly categorized niche segments, based on site visits and app usage — much of it de-identified, from a personal perspective. But how do these segments really stack up against a transaction database, or response lists, or even compiled lists, based on personally identifiable information? Thankfully, we can test for this, or even overlay data! (I am not advocating re-identification here, nor should you. Oh California, please don’t force us to identify non-PII. It’s soooo anti-privacy.)

Recently, the Direct Marketing Club of New York (DMCNY) held a very interesting breakfast program titled “Beyond Demographics: The Data You Need to Max Out Marketing Performance.”

Some Fresh Categories for New Reach and Affinity Discovery

Consider some of these data sources for testing:

  • Values Data — Test cohorts based on “shared values,” rather than simply choosing audiences based on demographics or psychographics. David Allison, principal, David Allison Inc., and author of “We Are All the Same Age Now,” pointed to his firm’s internal research that shows that popularly defined age groups rarely (or barely) match on what they agree upon, or value, as a generation. For example, Baby Boomers agree with each other about 13% of the time; Gen X, about 11% of the time; and Millennials, 15% of the time. Thus, targeting based on demographics alone can be extremely wasteful if the marketer is assuming some sort of shared attribute among them, other than age.However, when targeting based on shared “values” — Adventurers, Savers, and Techsters, and the like — all of a sudden affinities jump sky-high. In these cases, 89%, 76%, and 81%, respectively. These “valuegraphics” are based on “big data” segments — rather than small data (response lists, for example). Still, when compared to demographics targeting alone, shared-value targeting offers an eight-time lift!  Well, that’s worth testing.
  • Attitudinal Data — Another perspective on “beyond demographics” came from Mark Himmelsbach, co-founder, Episode Four, a creator of “brand hits,” such as this one for Charles Schwab. We often have stereotypical views of many demographic and other audience categories — and too many algorithms, he said. But analyze the data for unusual patterns, and suddenly you can find “who knew?” commonalities among certain audience segments that would wow any of us.Who knew that ultra-high net worth individuals are electronic dance music enthusiasts? Who knew that African-American married women are high on the e-sports genre? Or that young Hispanic/Latino adventurers are really into escape rooms? These discoveries give brands new advertising, product placement, and sponsorship opportunities, for example, which might otherwise go untapped. I’m still trying to get my head around these reported affinities, based no doubt by my own preconceptions.
  • Location Data — According to the World Economic Forum, 90% of the world will soon have or already has a supercomputer in their pocket — a smartphone. We’re actually closing in on four connected devices per person, reports Jeff White, founder and CEO, Gravy Analytics. With smartphones alone, as constant companions, we have a huge opportunity to leverage responsibly use of location data. Location can provide huge “affinity” targeting opportunities.A casual wine user might search and buy online his or her wine. But a wine aficionado visits a winery (Location X), or attends a wine tasting (Location Y), and now you have a true affinity opportunity. Granted, location data has a level of sensitivity that carries, more often than not, an opt-in requirement — but the marketing lift can be a significant reward for the advertiser who strategically applies such insights from it. Makes me want to tag every latitude and longitude for some hobby or interest!
  • Experiential Data — Live Nation may own concert venues, Ticketmaster, online game communities and music/culture festivals — but across these many first-party experiences, the company can provide deep analytics that help monetize its various audiences through enriched second-party relationships, said Anubhav Mehrotra, VP, Live Nation. Hilton, American Express, and Uber are just some of the brands Live Nation has teamed up with to enrich brand users with engaging experiences, such as backstage tours and “meet the artists.”

We are all trying to create and sustain customers, using data to discover new patterns, new audiences, and new prospects — and that requires a lot of testing, and innovative data sets to explore (responsibly). Let’s make it experiential, as well as experimental: I sure hope to meet some ultra-high-net-worth individuals at the next Electronic Dance Festival I attend. Or not.

Zeroing in on Your Consumers With Geo-Marketing

Mobile geo-marketing is growing at a rapid rate. This growth is driven by applications such as navigation, local search and social networking, as well as the public’s understanding of location-based marketing. With the increasing comfort level of sharing location data, brands are turning to location-based marketing to tap into consumers’ behavior to deliver more timely, personalized mobile experiences

Mobile geo-marketing is growing at a rapid rate. This growth is driven by applications such as navigation, local search and social networking, as well as the public’s understanding of location-based marketing. With the increasing comfort level of sharing location data, brands are turning to location-based marketing to tap into consumers’ behavior to deliver more timely, personalized mobile experiences.

Geo-marketing comes in a variety of flavors that utilize different technologies depending on how you are communicating with your consumers:

  • Geo-Fencing: This method is essentially a “virtual fence” designed to enclose a specific area for a marketing purpose. For example, a retailer can run a geo-fencing campaign where they “fence” in an area around their stores for the purpose of pulling in consumers who are near, but not shopping at their stores. Geo-fencing is not location detection in itself, but the geo-fences you setup—and the business rules you define as to what message to communicate to consumers when they are inside, or outside, those geo-fences—can be leveraged in conjunction with location detection capabilities.
  • Broad-Range Location: Some campaigns can leverage general area, such as city or ZIP code, to determine the right message to communicate. For example, an airline simply needs to know the metro area a consumer is closest to in order to personalize offers for flights out of the nearest airport. Location detection in this case does not need to be highly accurate to get the job done, and can generally be supported through most any mobile interaction.
  • Geo-Conquesting: This specific method of geo-targeting allows businesses to capture consumer spend away from competitors. The effectiveness of these campaigns can be further enhanced if the technology partner you are working with can layer on additional data that helps to understand the consumer better, such as third party sources that identify likelihood to purchase certain types of product.

For this article, let’s focus on geo-fencing. What you need to know is that geo-fencing simply needs to be paired up with a location detection technology, such as GPS or carrier network triangulation. Once detected to be inside a geo-fenced area, a brand can then alert potential customers who may not have visited your store otherwise. Retailers can also choose to send information, such as directions to the store, or run hyper-local promotions.

Retailer Takes Geo-Fencing to the Next Level
Belk, the nation’s largest family owned and operated department store, has added geo-fencing to drive in-store traffic and increase revenue across all of their stores by selecting very specific times, like major holidays (Easter and Mother’s Day) or sales (Belk Days) to geo-target customers with time sensitive coupons. For example, coupons for 20 percent off between the hours of 9 a.m. to 1 p.m. were sent out to customers who were near a Belk store to act now before the coupon expires. By offering relevant, time-based coupons, Belk has been able to grow their mobile marketing database and target real customers more effectively.

More Data, No Problems
Today, GPS, Wi-Fi and Bluetooth-enabled smartphones are capable of aggregating and sharing huge amounts of data. This data is very helpful for marketers to get a better understanding of their consumers’ behavior and target them in a more relevant manner.

Geo-Fenced data can then be used to see which offers and locations actually attract more customers, and whether that translates into more sales. Other possible metrics include the effectiveness of advertising, how often a customer visits the store, and how long they shop for. Additionally, geo-fencing can lead to better customer rewards programs. Once you know where your customers are and how they behave, you can encourage and reward them effortlessly.

Geo-fencing gives the customer a much more personalized interaction with brands by offering them timely, relevant offers via their mobile devices. 

Although privacy has been a concern in the past, recent surveys show that customers are happy to trade their personal information in favor of receiving special offers —but it needs to be additive, not intrusive. If it’s done right geo-fencing will revolutionize location-based sales and drive customer loyalty.