opinion
The explosion in internet usage, both personal and commercial, was seen to be a godsend for marketers and digital channels have often been heralded as a panacea for the ills of traditional marketing. Especially given the growing consumer apathy to marketing and media generally, the internet promised to invigorate communications by providing a direct, targeted and measureable channel to reach consumers.
Indeed, official figures paint a positive picture too. The Internet Advertising Bureau reports that in the first half of 2007 over GBP1,334 million was invested in internet advertising - this soaring investment means more is now spent on digital channels than traditional DM and email volumes now exceed direct mail volumes (DMA Benchmarking survey). But most importantly, consumers are mirroring this investment with their own shopping habits. The British Market Research Bureau (BMRB) found that 73% of internet users have shopped online in the past 6 months, equating to a total spend of GBP13.8 billion. Over the past 18 months, BMRB found that consumers spend is increasingly migrating online from the high street - good news for catalogue marketers, but only those who are ready to make the most of the available opportunities.
Of course a lot of brands are already using digital channels as a means of communicating with consumers and email marketing has become a core element of this. Yet, in general, the level of sophistication applied is somewhat lacking. Which is concerning, as without segmentation and the resultant insight, creating relevant and personal communications is nigh on impossible.
When it comes to email many marketers use it in exactly the same way as much traditional direct mail - embodying a low cost, high volume mentality, basing their promise of success on reaching enough people to instigate sufficient response. And even though digital communications do not produce the same amounts of environmental waste as direct mail, this approach is still less than 'green' and has the same effect of clogging digital channels with 'junk' communications. Moreover with email still developing its position in the marketing mix, irrelevant and irresponsible use puts it at risk of damaging its reputation. The same issues of permission being reneged as seen with MPS and TPS will erode opportunities for good marketers.
So how can marketers make the most of the direct, targeted and measureable medium that is email? The answer lies in the wealth of data that online channels produce. Thanks to these vast pools of digital data, marketers have almost instant indicators of consumer behaviour. The challenge for them is to create strategies which can apply this data and react to the buying signals consumers are giving out online.
At the heart of this has to be an application of the same fundamental principles of good direct marketing to their digital marketing - know your customer, build a personal relationship with them over time and use the available data to help you to do so. Direct marketers are particularly well versed in the use of customer data to develop personal relationships. Applying insight from data to identify groups of customers and tailor the most relevant messages to them is a crucial element of a direct marketers' toolkit.
Unlike above the line advertising, digital channels generate real-time data that opens up a world of personalisation opportunities. We know whether people have opened an email and the action taken as a result, allowing for a whole new level of measurement accuracy. But marketers should not stop short at just measuring how their customers and prospects interact with their communications - they should be extracting insight to create more relevant and personal messages. Relevance and timing are key to generating a positive outcome from any interaction with consumers; where both brand and consumer get what they want. What's important is developing the means to understand, instantly, what is the most appropriate response. To the customer, they stop being 'marketed' to, and instead are presented with a communication that is more likely to generate what we call a 'Positive Interaction' between a consumer and the brand.
So if using data is the foundation of getting personal with email, how should marketers be using and applying it? First and foremost, we have to recognise that personalised email marketing is much more than just including the recipients name. Just think to all the times we've used websites which 'remember' us as customers, and those which recommend products based on our previous purchases. Sadly the amount of email marketing that mirrors even this simplistic approach remains woefully low. Personalisation of this type is easy for brands to implement and creating tailored messages not only makes consumers feel more valued, but is also makes for significantly more effective communications.
To do this data has to be incorporated at the beginning of an email campaign. Marketers have to establish how their email content will differ for the various segments of their customer base. It should not just be the offers consumers are presented with that vary, but the creative execution as well. Aligning the look and feel of an email to a consumer profile will help enhance the resonance of the message.
But brands must exercise caution when using data. Fears about consumer data and its use are rising rapidly. Consumers are more acutely aware of how, where and why their data is stored and used than ever before - and marketers cannot shy away from the challenges that this presents. The protection of consumers' data and privacy should be of a paramount importance at any organisation, but the application of insight has to be handled delicately. The level of personalisation should be at an appropriate level for the brand and the relationship that consumers have with it.
There is still an even greater level of sophistication possible - by combining online data with traditional offline datasets brands obtain a complete, joined-up view of their customers. We must remember that many transactions still occur offline, and digital is still just one of the channels that consumers use to interact with a brand. But by using all available data on a customer (whether stored or instantly generated) brands can develop rules which identify the offers or services most appropriate to the individual. The significance of all this is that marrying online and offline data doesn't have to result in the use of a digital channel. In fact, the message or the channel is almost irrelevant. Brands may favour email and online communications but ultimately consumer preference should be the deciding factor in media channels. But no matter what medium is being used the same principles of relevance, timeliness and measurability should apply.
The important point is to challenge ourselves at every step of the work we undertake for clients. If a banner ad is being created, let's think about how it can elicit a response, what data this response collects, and how this data can then invoke a Positive Interaction further down the line. Even offline advertising can be subject to this scrutiny; how can it drive footfall to a website or encourage customers to call an information line? And again how can we translate this action into a favourable reaction?
Consider this example; an existing customer visits a brand's website and begins browsing a product of interest. Offline data (i.e. their transaction history) reveals that the customer in question hasn't bought this product line or anything similar before and is an infrequent purchaser that sticks to particular products. This gives the brand an immediate opportunity to broaden its relationship with the customer. So combining on and offline data in real time could trigger a personalised offer to the customer, offering them a discount on a product they've been looking, and giving them an incentive to encourage a purchase.
Another customer looking at these products might be identified as someone who makes regular purchase from many departments - again from the transactional data held - and so could be made a combined offer to upsell additional units or lines.
A process such as this embodies intelligent marketing - ensuring that all messages to the individual are personalised, relevant and timely. But the principles discussed can and should be applied to all media channels. To do so requires a change in the accepted approach to marketing. Instead of spreading the net far and wide, in the hope of catching some interested parties, consumers should be cherry-picked and every communication made relevant and personal to them. When used effectively personalisation helps brands build closer relationships with consumers and it works for consumers too. They stop being 'sold' to, and instead are presented with a communication that is more relevant, targeted and useful to them.
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