The Future of Digital Acquisition Series: Part 2
Data and Privacy. Delivering Customer Acquisition while respecting privacy
17 August 2021
Digital at its core is based on ones and zeros, and numbers don’t lie (unless manipulated ofcourse). We are surrounded by these ones and zeros, sometimes willingly and unwillingly. Since everything is number based, it’s easy to track what we do with those ones and zeros, hence giving brands visibility over what goes where. It’s not easy to understand whatever that goes on at the back of the number crunching platforms, because it is complex in ways which are sometimes difficult even for the best data analysts. So how can anyone expect a non-technical person to understand these things?
However, humans evolve rapidly, and so does our understanding of the world we live in, including the ones and zeros. We had a good run knowing when our customers sleep and wake up. Knowing the habits of people on the internet helped brands understand their customers’ needs and aspirations, resulting in a hyper-relevant user experience, and the most addressable media optimization ever.
There are hard workers and there are smart workers. Often there is a fine line between smart and unethical, and a thief is not a thief unless caught. Knowing users’ online behavior was a blessing till it was used to “spy” on them without their permission. It is theft if something is taken without consent, the same applies to data. And as more common people become aware of ones and zeros, the more they become aware of such thievery and start taking action against them. This is happening right now, and things will get really complicated (if not totally irrelevant) in the advertising world. With Apple taking the first step in providing its users with permission to deny tracking users with the introduction of iOS 14.5, and Google getting rid of cookies, things are not looking good for the future of intrusive marketing.
With Android owning more than 73% of the global mobile device share, and being an ad vendor as their primary business, it’ll come down to the ecosystem people are in, Apple or Android. Apple users will have some impact on the way brands target them, but for Google, the war is not against brands, and there will be a close alternative (see FLoC) available before anything bad happens.
There are two sides to the privacy story, the consumer and the advertiser. From consumers’ point of view, providing them with an adequate option to control their privacy builds trust and confidence. And you can see that from the way Apple Stocks (NASDAQ:AAPL) are soaring since the introduction of iOS 14.5. But does that disrupt the way brands have been reaching out to consumers? Short answer, yes. That’s the other side of the coin, where it’s not as easy to target people using their behavior across the internet. Brands can still use contextual targeting methods, which may or may not be as efficient as behaviour-based targeting. It’s too soon to say how it actually impacted the buying behaviour of any consumer.
In an era where brands cannot target people using intrusive methods, the most important thing to do is to go back to basics of marketing, and start building top of the mind recall. If you don’t know how to reach out to your customers, make sure they find you. Our over-reliance on intrusive and private data for marketing resulted in brands focusing only on the bottom part of the funnel, which we also call performance marketing. By doing so, we managed to get the max bang out of our bucks by putting ROI on everything that we do on digital, but that shrunk the top of the funnel. The impact of a smaller top funnel: more people are buying things when they come to your shop, but less and less people are coming to your door - because they lack brand familiarity. Imagine comparing a restaurant to a food truck park, you can convert people easily but there are a lot of trucks with cheaper options, and no brand recall, so the fight is more difficult.
Somewhere during the race to become highly relevant in digital marketing we started losing our integrity without even realizing. When I say integrity, it’s letting people have a private life. It’s not fair to customers that brands spy on them in the bedroom, just so that they can sell cat food the next day. People will look for what they need, that’s where brands need to understand the context rather than behaviour. And it’s not even brands’ fault, not completely. They are just given an option to be highly relevant when running their ads, without disclosing how this relevancy is being achieved.
Respecting people’s boundaries while making sure they recall a brand is not that difficult. What’s difficult is to know how to mark your presence in a contextual way. Customers are trusting you with their data, use it carefully and definitely don’t pass it on to others. And now it’s not even a request, or a guideline, it’s becoming a law everywhere in the world.
That was about the issues with living with and without privacy laws. But what do we do to make marketing relevant in a privacy-first world? Let’s list down a few things to begin with.
1. A well equipped data management team and system - Brands need to stop being careless with how they collect and process data. It cannot be excel or shared docs if you’re dealing with Personally Identifiable Information, or PII data. It’s not safe for PII data to be left loose on such unsecure platforms. There needs to be a system for proper data access policies, for data which is stored in a secure and restricted place, managed by qualified individuals.
2. Responsible data sharing - With hundreds of new martech and adtech companies sprouting every month, and an equal number of marketing companies coming into existence, it’s important how you share this data with them. Like I mentioned before, your customers are trusting their data with you, not with the platforms you work with. It’s brands’ responsibility to make sure that all partners they use are as responsible about data privacy as the brand itself.
3. Audit third-party platforms - We have to rely on third-party platforms for a variety of needs, like Website Analytics, Social Media channels, Ad Serving and Tracking, Remarketing, Dynamic Content Optimization, Mobile Analytics Partners, Customer Relationship Management and Customer Data Platforms, and many more. And it’ll be really difficult and costly to either not use them or build something in-house from scratch. Since avoiding all third party channels is next to impossible, it’s important to have a discussion with the Data Management teams of these platforms to understand how they process your customers’ data. Checking their data privacy compliance (PDPA and similar laws) for all countries they operate in is the first step.
4. CRM and CDP - Most brands who have collected a customer database need to have a proper Customer Relationship Management (CRM) platform. CRM platforms usually have the capability to manage PII based marketing, or integrate the databases to other PII marketing channels like email and SMS marketing. In the privacy first world, there is a greater need to efficiently manage the database for marketing. What we need is a platform which not only integrates with email and SMS marketing platforms, but also can create audience profiling based on multiple data streams. The data streams to be managed are both inbound and outbound. To do all these, you need to move from a simple CRM to a Customer Data Platform (CDP), which can not only manage your database, but also integrate it with most of the digital marketing channels including email, SMS, Facebook, Instagram, Google, and programmatic etc.
5. Data clean rooms - Once you have finalized the CRM and CDP systems you need, you’ll come across another problem - Data Duplication. Since a lot of marketing channels are not interconnected, especially when it comes to PII data collection, these channels may reach out to the same person creating duplicate entries. You may experience that the data you have collected is big enough for your marketing efforts to kick-off, but after removing duplicates, it may come down to 30-40% of its original value. Data Clean Rooms will use all the first-party data you’ve collected, and then match it with the aggregated data from other platforms like Google and Facebook. It identifies how much of your data is getting matched across this aggregated data, hence streaming back the unduplicated data for your marketing purposes.
6. Focus on top and middle of the marketing funnel - With limited customer information, brand familiarity will play a vital role. Because brands will find it difficult to be hyper-contextual in the communication, lower parts of the funnel will get influenced by what happens in the upper and middle of the funnel. However, building brand trust and familiarity takes time.
You start with reaching out to the maximum number of people, but that’s just announcing who you are and what you can do. You may end up getting some traction, and possibly some customers. But once that’s done, you’ll need your brand advocates, people who will take care of your marketing for you by creating a ripple effect. It sounds easy in theory, but the job of marketing is to bring people to your doorstep, what happens after that is much more complicated and interconnected.
At the core of everything sits the product itself, and it should be what you promised it to be in your marketing - if not more. Then comes the after-purchase care, how to respond to happy and angry customers in the same gratuitous and empathetic manner. These things sound simple, but they’re not. But if done right, you will not need to spend a lot of money talking about yourself by focusing heavily on top of the funnel marketing, your happy customer will do that for you. More about this particular topic in the upcoming articles.
Want to learn more about data and privacy? Schedule a chat with us today.
See you next week as we continue the Future of Digital Acquisition series.