Speaker Q&A with Tim Flagg, CEO, Advantagious and ClickZ Podcast Host
Ahead of his chairing of the MadTech Theatre at Technology For Marketing/ad:Tech 2018, Tim Flagg talks to John Bensalhia about the evolution and trends in the Data Marketing field, and explains how technology and legislation is giving power to the consumer...
1. What are the origins of Data Marketing?
Marketers have always looked for data to inform their decision making, you can find examples of Victorian soap brands A/B testing in newspapers. What’s changed this century is the scale of data available and the ability to store and then access that data. The 1980s saw the arrival of computer based databases. As those database gathered more data about audiences, marketers were able to target their ads not just by demographic but by profile and make predictions about their behaviour. New industries arose to build and sell these databases, but the really clever activity was building the profile in the first place. You may remember the A5 direct mail supplements in weekend newspapers from the 90’s. These gathered valuable profiling data about a household’s composition, behaviour and needs. This profiling data was much more valuable than the revenue they received from selling ‘home laser displays’ or ‘garden kneeling pads’. Data and direct marketing became a critical part of any marketing plan in the 90s and many statistical scientists and data analysts were attracted to this area during this time. As marketing became more measurable, it was important to establish benchmarks for what ‘good’ looked like to truly assess the performance of campaigns. Performance Marketing as it became known was driven by database and direct mail.
The arrival of the internet and mass consumer adoption saw three important developments:
The Website Cookie: Cookies were established as the standard way to track and identify individuals on the internet, particularly to serve more targeted advertising. Publishers assumed that they ‘owned’ their online audiences, just like they had ‘owned’ the audience of their print titles.
The Customer Journey: As online purchasing became more commonplace and ‘eCommerce’ grew, marketers could finally see the customer’s journey more readily able to identify the influences on the final purchase decision, and giving us an understanding of the time frame. In theory, we could now see the full picture from initial ad to final purchase.
True Accountability: More data has made marketing more accountable and commercial. Modern marketers are data scientists. Because we can measure more, we can test more effectively. Having the data allows us to be more experimental, but marketing hasn’t caught up with the vast amount of data that is being produced. The volume of data is overwhelming.
2. What notable developments have recently occurred in the Data Marketing field?
Well, I’m sure everyone has heard about GDPR by now. For me, this is part of a bigger trend. 27% of UK adults are using an ad-blocker, this increases to 40% amongst 18-24 year olds. This indicates the deeper change in the consciousness of the consumer. Over the last decade consumers have become more aware of the value and vulnerability of their data, and of course the huge volume of data that is held about them. Adblockers are an indication of this trend and GDPR (and ePrivacy) is merely a piece of legislation that will act as a catalyst for this growing consciousness. Data marketers have been kept busy for the last 12 months ensuring their data is GDPR compliant, repermissioning users, a process which was useful in removing inactive contacts and in putting database maintenance at the front of board priorities. But what this really means is brands now need to have a reason to contact individuals, they need to be transparent and willing to remove any data they collect. Above all, brands need to respect consumers privacy and handle their data securely and that to my mind is well overdue.
Unfortunately, the last decade has seen marketers employ a ‘spray and pray’ approach both in email and programmatic display. Not only is this lazy but highly inefficient. When you consider that a 1% click through rate is a good result, this means that 99% of the spend is wasted. It is inefficient and it has led to low quality advertising geared for the lowest common denominator, the click. Advertisers would be more targeted if they had access to better data and of course you might think that post GDPR that’s much harder, but that’s where I think we need to rethink the model. By putting the consumer in control and at the heart of the value exchange, advertisers can request access from consumers, and get much more accurate data than we’ve ever had access to before. That’s what my company, Advantagious, is pioneering. We provide the platform for advertisers to request access to the profile of an individual.
3. What are the issues with Data Marketing?
The problems stem from a lack of transparency and control. Historically data has been collected about consumers and then stored and sold by large corporate organisations. In this model the consumer gets nothing, but the businesses that collect and sell their data are making money from the consumers’ profiles. The industry has been tainted by these somewhat shady transactions, most recently and famously by Cambridge Analytica. The value exchange has to change, it was changing before GDPR and it will only accelerate afterwards. That’s why at Advantagious we’re building the tools that allow users to take control of their data and sell access to their data profiles to businesses, such as advertisers, who want to access it on the consumers terms. In our model, the data always belongs to the consumer and we just provide the platform and tools to monetise it. Not only is this more ethical and therefore sustainable, but it means that advertisers have much more accurate data about consumers and their purchase intent. This data is available to all businesses, who are willing to request permission. Ultimately this will lead to better and more relevant advertising. I believe that by putting consumers at the heart of the value exchange, everybody wins.
4. What are the benefits of using technology for marketing?Technology brings lots of advantages to marketers, but if you look at the expansion of the MarTech landscape you’ll notice that there are now thousands of suppliers, solutions, software and tools. Quite frankly it is impossibly hard for marketers to keep up. When I spoke to Scott Brinker (Chiefmartec and VP at Hubspot) recently about the growth of adTech he said, ‘If you’re not feeling overwhelmed, then you’re not doing your job very well”. Marketers have to be curious, we have to be scientists, constantly experimenting and progressing based on evidence.
It’s a great time to be a marketer, I see technology benefiting marketing in four main ways:
Firstly, technology allows us to process more data, automate more sequences and therefore cope with more volume. Marketers desperately need this to be able to fulfil the myriad of new channels that digital technology now presents us with. Digital technology has also opened up the world but this also presents marketers with the challenge of having to deliver not just more campaigns, but more campaigns in different languages, adding an additional level of complexity. So marketers need to rely upon tools such as CRMs, email automation, Data Management Platforms (DMPs) and Digital Asset Management platforms. All of this means that as an industry we’re turning into Marketing Technologists, and we’re required to have opinions about ‘tech stacks’ and ‘roadmaps’, often responsible for massive database, APIs and sometimes even business wide digital transformation.
Secondly, technology allows us to respond quicker and better. Consumers expect faster results, this is constantly being driven by new technology and new business models driving up consumer expectations. Customer service is an area that is being massively disrupted by technology. Just look at how some companies (and local government) is investing in smart customer service ‘robots’ like Amelia that adapt their facial expressions to match a customer’s emotional state and when they don’t know the answer listen to the response given by their (human) manager so they can learn for next time. Other companies are using VR as an ‘empathy engine’ to train customer service staff to see the world from the eyes of a customer. They can watch a role play from the exact perspective of the customer, using VR goggles, and then flip to see the same role play from the eyes of the customer service rep. We’ve already seen how technology such as social media has enabled brands to have a real-time dialogue with their consumers. Whether it’s voice search or augmented reality, technology allows marketers to understand consumer expectations better and respond quicker.
The third way that technology benefits marketing is where it empowers collaboration. In order to fully exploit the power of technology and cope with the increased volume, speed and complexity marketers need to collaborate both internally with other teams and externally with consumers. Taking internal collaboration, by building one central CRM marketers can create a single view of the customer and this allows common goals to emerge. Project management tools such as Slack, Trello or Dropbox are commonplace in most tech businesses. This collaborative technology is essential to fast moving, highly agile, rapidly learning, constantly experimenting teams. As marketers become more agile, they rely upon these tools. Externally, brands need to find ways to collaborate with their audiences rather than broadcast at them. Large multinationals like Johnson and Johnson, P&G and Unilever, are investing in technology platforms often with a social purpose, empowering communities to collaboratively generate content. A great example is J&J’s ‘Donate a Photo’ platform that allows people to donate photos in return for $1 that J&J donates to the person’s nominated charity.
Lastly and perhaps most importantly technology allows us all to be more accountable. Marketers can now measure the performance of almost all of our activity. This data can be brought together in reporting and analytics software, quickly and easily visualised and shared with the entire company. Technology allows us to report the right information in order to make decisions faster. The result is a more analytical and commercial marketing team.
5. What does the future hold for MarTech and AdTech?
The MarTech and AdTech landscape has seen a huge boom over the last decade, but the majority of those companies have been middlemen, selling software, data processing or ways to make existing processes more effective by using technology. The first chapter of any marketing handbook starts with the consumer and that’s something that we too often forget about. The recent GDPR and forthcoming ePrivacy directive mean that legislation now enshrines the power of the consumer, to the long term detriment of companies who have hitherto traded consumers’ data. The new reality is that consumers are taking control. So instead of talking about MadTech, we should really be talking about ConsumerTech. It’s a fundamental paradigm shift and something that Advantagious is really excited to be leading the way in. Watch this space!