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The direct marketing industry has been predicting it for years and at last data strategies are sweeping through global marketing departments like wildfire as brands finally wake up to the power of customer analytics and predictive approaches.
Sir John Hegarty may not be happy about it, yet the BBH chief’s declaration that “data creates nothing; but creativity has all the time” appears to be falling on deaf ears in most marketing departments, according to new research from the World Federation of Advertisers (WFA).
The study, conducted in conjunction with The Customer Framework, found that 72% of senior marketers view data as a strategic asset, but flags up the growing potential for agencies and suppliers to get involved as more than half are only just starting to give it a central place in their marketing.
Based on responses from 32 companies with a global annual marketing spend of $35bn, the survey found that 31% described themselves as advanced or highly advanced in the adoption of data-driven marketing, using multiple data personalisation and segmentation techniques.
These advanced companies were underpinning their efforts with a range of technology solutions, including CRM systems, analytical systems, data management platforms and rules engines.
However, not all companies are as advanced. Some 56% of respondents recognise they are still early in the journey, at best in the initial planning stage and have yet to deploy a data-driven marketing strategy.
The study also found a range in confidence in analytics, with only half “somewhat confident” and 27% “not very confident” in their ability to identify return on investment via data analysis.
Nevertheless, investment into analytics and insight is on the rise with 89% of respondents expecting to increase budgets and 31% to boost them “greatly”. The goal is to evolve the analytics function from historical reporting of “what happened” to more predictive and prescriptive approaches, something that a quarter of respondents already claim to be able to deliver.
The desire to build direct customer relationships via the use of first-party data was clearly highlighted by the research, with 73% of respondents considering this “business critical”, and 88% planning on ramping up usage.
However, with the increased use and processing of consumer data, 85% of respondents acknowledged that privacy is integral to building customer trust, and more than just legal compliance.
And it would seem that despite looming EU General Data Protection Regulation – which could trigger an opt-in marketing data regime – brand owners recognise that their ability to embrace a data-driven future relies on increasing consumer trust, which in turn, requires brands to go beyond compliance.
Some 85% of respondents viewed data privacy as an integral component of customer trust, not just legal compliance.
Matt Green (pictured left), senior global marketing manager at the WFA, said: “It’s no secret that data has become important for marketing purposes, though it’s interesting to note that even some of the world’s biggest companies are only at the early stages of delivering data driven marketing strategies.
“Data consumption is set to increase rapidly and with that sophistication – clarifying how data will be used and how consumer privacy will be protected, should be a fundamental component of a brand’s strategy as it advances into data-driven marketing.
“Enhanced transparency and a strong value proposition will be vital to ensuring consumer trust in how the industry collects, stores and uses data today and in the future.”
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The claims, made by Professor Andrew Ellis of Aston University’s School of Engineering & Applied Science, will come as a further blow to the digital ad industry, which has been under close scrutiny of late.
He reckons that current technologies will reach their limits within the next eight years, and without radical developments and rapid deployment of alternatives, capacity will be unable to match increasing demands.
Professor Ellis, who was speaking at the recent Lightfest 2015, said: “Demand for internet capacity keeps soaring, and we’re now reaching the point where it’s increasingly difficult to stay ahead of that demand using current approaches.
“It’s incredible we’ve managed to stay ahead this long, but now researchers are finding they just cannot fit much more data down traditional fibre optic lines.
Ellis added that unless costs are increased by deploying more fibres, there will need to be radical changes to the way data is used and distributed if the capacity crunch is to be overcome.
“We should start having the conversation now – are consumers willing to accept higher charges for increased bandwidth or can we be more considered about the capacity we consume? Will we lay additional cables, or will we look to the likes of Netflix to help us manage demand?” he added.
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Personalisation is no longer optional for retail companies that are serious about future-proofing their online strategy, according to findings in a new white paper by digital performance agency, Found.
Specifically, with the widely anticipated slowdown in ecommerce growth predicted over the coming years, getting the right content, to the right people, at the right time has never been more important for online retailers looking to achieve increased sales and conversion rates as well as heightened customer loyalty and long-term spend. However, it’s clear there’s a long way to go before the industry fully realises the potential of personalisation, with Econsultancy alone revealing that while 96% of retailers believe personalisation makes good business sense, only 6% have a plan in place to actually use it.
Tina Judic (pictured), managing director of Found, said: “As an industry, we are now moving away from static, heavily-scheduled campaign planning and delivery, to instead embrace more instant and agile activity which enables more intuitive response to customer need. And it’s the need of this now always-on consumer that is the driving force behind this major shift.
“With growing numbers of consumers expecting, and deliberately looking for, more relevant and tailored customer experiences, irrespective of device, time or location, it’s clear that personalisation is no longer optional for any business looking to maximise all that digital has to offer.”
Found’s white paper lifts the lid on the current resurgence of customer expectation for more personalised relationships with their favourite brands and explores the technology, approach and the impact of personalisation for businesses focused on brand stand-out as well as return on investment. Written in conjunction with personalisation specialists, Monetate, the study equally dispels any misconceptions over how personalisation works and gives practical advice into how it can be integrated into existing marketing campaign strategies.
Personalisation is now a key consideration for any business and the white paper – Personalisation: Future-proofing your Ecommerce Strategy – shows how one-size-fits-all marketing is fast becoming a thing of the past. It also reveals how once over-protective privacy shields appear to be coming down with more and more consumers realising the benefits of sharing their data to receive more relevant products and services.
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