Advertising can have a profound impact on driving sales. But in this digital, data-driven, customer-centric, age of choice, what’s your definition of advertising? The concept isn’t necessarily elusive but it has become difficult to define with certainty and consistency. As new channels, new data and new opportunities to connect with consumers emerge in real-time, paid media is increasingly fragmented and the separation between earned and paid less clear.
Largely thanks to digital, advertising isn’t the only marketing genre with an identity crisis; the entire spectrum of the brand-consumer relationship is evolving, blurring traditional boundaries and established silos. Digital advertising is shopper marketing. Retailers are brand marketers. Publishers sell products. Media is “shoppable.” Among all this change, developing the right strategy to engage the right customers with the right message becomes harder for marketers without access to customer data.
But there are many that do have data. Retailers, armed with granular loyalty and transaction data, have the hard data to link digital advertising to consumer behavior and online strategies to sales. With their manufacturer vendors, retailers are delivering digital ads as personalized branded experiences, in the form of tailored recipes, helpful articles and imagery for products available a click away. These branded messages engage consumers with a “virtual endcap” when they are in the mindset to buy or browse. As a result, retailer-published display ads are less likely to be seen as annoying interruptions but helpful and engaging content. Amazon recently setup their own demand side platform to capitalize on this and is estimated to generate up to $1 billion in ad revenue this year, according to Baird Equity Research.
Not only is this new breed of digital “advertising” rewarding and relevant for the customer, it delivers clear ROI to the brand. According to Forrester Research, digital media will influence 53% of in-store sales by 2014. As this happens, the popularity of retailer-branded advertising is likely to continue to surge, giving brands the opportunity to measure what matters, sales over clicks, and improve campaigns overtime. Will this retailer-driven model eventually replace the publisher model digital marketers have come to rely on?
The advertising and media industry is on the cusp of a major transformation around relevancy and accountability. As customers continue to demand communications, products and services tailored to their personal needs, the publisher model of digital advertising and “spray and pray” methods won’t be sustainable. Retailers are definitely positioned to play a key role in this environment. Only retailers can truly “close the loop” to measure impact of marketing because they have shopper sales data. There is no advertising more measureable than marketing campaigns run with a retailer.
So, what does this mean for marketers? We need to expect more from advertising. Advertising can be personalized, engaging and measureable so that campaigns become more sophisticated and our understanding of the customer grows over time. We need let go of our definitions. The traditional, business-centric channels, budgets, campaigns, and marketing plans are no longer customer centric. Modern marketing is about the customer. The customer is our anchor to help us navigate all through the blur; a new digital ecosystem that is constantly influx.
-Allen Mason, Vice President, Analysis, Strategy and Planning, dunnhumbyUSA
Hear more from Allen Mason at the Digital Non Conference on “Are Retailers the Future Media Publishers?” on Wednesday, October 24th at 3:00p.m. at FB’s, 126 W. 6th Street.
Allen Mason, Vice President, Analysis, Strategy & Planning, dunnhumbyUSA has spent his career on the cutting edge of brand management and digital communications, launching global digital strategies and programs for billion-dollar consumer packaged goods brands like Gillette and Pantene before joining dunnhumbyUSA. Mason leads the development of dunnhumbyUSA’s digital shopping and communication solutions, which enable brands and retailers to personalize their engagement with customers across channels. Mason spent over fifteen years in digital and brand marketing roles across multiple categories and markets at Procter & Gamble. He is a member of the Advisory Board for Total Beauty Media, advising on digital and business strategy for websites like TotalBeauty.com. Follow him on Twitter @allenrmason.