While it gets easier and easier to measure marketing’s impact on its consumer and business targets, it gets harder and harder to compartmentalize marketing spend into channels. This is good, considering marketing thought leaders have been advising professionals for years to avoid marketing silos and instead be customer-centric.
To that end, the chapter on data in the Direct Marketing Association’s recently released “2015 Statistical Fact Book” shows the link between digital, database, real-time, programmatic and predictive analytics.
“Why will this be the year where addressability and programmatic drive better audience targeting,” asks Kevin Dean, SVP of global product management at New York-based Experian Marketing Services, who authored the Fact Book’s overview of the data chapter. “A short history lesson is required. Every time a medium becomes digital, it becomes addressable at the household level. And every time that happens, the data and the tools for planning, targeting and communicating in that medium change. Throughout the history of direct marketing, this has always been the case. Nearly four decades ago, this happened in direct mail, then it was telemarketing, then it was email, then it was site optimization, then it was social, then it was display, and now we’re seeing the evolution take hold in TV. So it’s very reasonable to believe that at some point in the near future, most media will be transacted around a household-level audience and resemble something that very much looks like a mailing list.”
What Dean writes in the Fact Book released on May 26 notes that there’s a difference between today’s marketers — the ones who stick with their guts and decide not to target on Gourmet or Bon Appetit’s digital platforms in order to reach 18- to 34-year-old males with display ads because they think men won’t see them, and the ones who know better. The marketers who know better are using data available in real-time, programmatic programs to find and target the 1 to 5 percent of men who do visit those sites. Also, using predictive analytics, those marketers can target future visitors.
So, as FTI Consulting announced on Monday, marketers will spend $41.8 billion on online advertising this year and that number will climb to $55.6 billion by 2018. Many of those same marketers are budgeting $11.5 billion “on data and related solutions across the three most prominent channels (email, direct mail, and display advertising),” according to the May 26 DMA announcement about the Fact Book. Those marketers will be collecting and analyzing data from a staggering number of sources, including what DMA calculates will be “50 billion connected devices over the next five years.”
Many marketers will find an advantage in doing something proactive with that data. Here’s a snapshot of what DMA and Experian found marketers plan to do in predictive analytics in 2015:
1. Modify business processes: 36 percent
2. Enter new markets: 35 percent
3. Drive marketing automation: 33 percent
4. Predict lifetime value of each customer: 32 percent
5. Influence marketing messaging: 30 percent
6. Influence product development: 27 percent
7. Influence M&A activity: 20 percent
How else do marketers use predictive analytics? How are marketers using attribution to drive budget allocations?
Please respond in the comments section below.