CRM in Programmatic: Part Two
The second article in a series aimed at helping marketers put their first-party customer data to use in digital display advertising
After discussing the definition of CRM and why it should be considered essential for marketers in the first article, in this second part of our CRM series we’ll focus on the existing market trends within CRM, how CRM enables better customer segmentation and thereby personalization, and what CRM-driven marketing looks like within different verticals.
To start, we should ask ourselves one simple question: what do we want?
We Want Data
More than ever, businesses aspire to be data-driven. It makes perfect sense: proprietary data can be your trump card. Data can be what makes the difference between knowing and understanding your customers or prospects…or not. Data enables you to make more informed strategic decisions about how to manage your business.
The rise of programmatic advertising, which has given marketers more control and ability than ever on whom they want to reach, helped to push CRM into priority status in the world of big data. Even for a simple email campaign (as an example), the available CRM can (and should) be used, and marketers need intelligent data in order to know how much a customer is worth to them. This means that CRM needs to extend to both offline and online channels – after all, customers exist both online and offline, and companies need to reach, delight, and
With this in mind, the ability to build a unified, exclusive database of all your customer interactions, tallied across all buying channels and marketing touchpoints, can be seen as the ultimate goal. Many companies are still in the early stages when it comes to having a CRM program that is fully integrated with all business channels and datasets, making the process of creating an actionable CRM database a long and costly one. There’s no doubt, however, that CRM functions best when it’s cross-channel.
But what should we would use that expensive database for, exactly?
According to Econsultancy’s Cross-Channel Marketing Report, 68% of companies agree that their “priority is for all key marketing activities to be integrated across channels,” but only 39% say they “understand customer journeys and adapt the channel accordingly.” Cross-channel marketing is obviously a priority for most businesses, but many are wrestling with the realities of making it happen.
Additionally, as mobile penetration continues to grow, there’s the more pressing need for marketers to bring mobile into the CRM mix. Mobile is increasingly the channel of choice for most customers, and particularly millennials. In the US, for example, comScore data showed that mobile accounts for two out of every three minutes spent on digital channels. One of the challenges marketers face with integrating mobile is where to put it within their CRM program, and how to tackle the complex ecosystem of data that it holds – the wealth of customer data that mobile holds is not to be ignored. If cross channel isn’t achievable, at least you can at least start by focusing on mobile.
Segment & Personalize
Incoming customer data can be overwhelming in volume. Even with the most sophisticated CRM systems in place, it can be hard to make sure data passes between various channels and technology platforms, and is distributed across all aspects of the business where it can have an impact.
With these issues, data can sometimes block personalization instead of enabling it; with so much information to process, companies can give up and merely generalize – exactly the opposite of what data should allow. According to Econsultancy’s Measurement and Analytics Report, only 30% of businesses agree that their “current data architecture is an enabler for personalisation.” Additionally, less than half (48%) of respondents said they have a good understanding of customer behaviour and just 28% have this understanding broken down by segment.
This last statistic is a clear indicator of where businesses are versus where they want to be. In an ideal world, marketers crave the ability to deliver truly contextualised marketing. However, with most companies unable to even understand behaviour at a segmented level, delivering a completely personal experience for each client is more of a distant dream than something close to realization.
Depending on how far you are with your CRM program, there are different approaches you can take to segmentation. You can segment by simple demographic factors such as age or location (how close is a customer to your nearest retailer branch?), loyalty status, how long someone has been a customer, how long it’s been since their last transaction, and many other options. Skipton Building Society, for example, is segmenting customers by life stages (such as age and affluence) and customer journey, while high-end fashion retailer AllSaints segments based on how the customer discovered their brand.
How do companies manage to do that, though? How is all this data managed?
The Platform Play
As we’ve seen, it can be extremely hard to grasp all the multichannel data that markets need to reach their audience. Never has the industry changed so much and so quickly, forcing marketers to adapt very quickly to all the new channels that keep popping up. Along with this, marketers now want to merge third-party data with their own, in order to better segment audiences. All this has created the need for DMPs – Data Management Platforms.
According to Econsultancy research, investment in data management platforms has doubled in the last 12 months, from 15% to 30%, which shows how important they are for many companies. When it comes to providing the next stage in cross-channel marketing strategies, DMPs can be a big help.
In essence, DMPs are repositories of online consumer behaviour data. This allows brands to target customers exhibiting genuine purchase intent based on real data, in the form of programmatic ad buying, for example. The major benefits of having a DMP include gaining centralised control and standardization of existing first-party data, and using the data they already have for better email, web, social and content personalization.
We shouldn’t forget to focus on the big issue at hand, though: having all of a company’s data in one centrally accessible place is ideal, but the big challenge is to analyze and use that data. That’s where the treasure is buried.
Want to know more? Head over to the Econsultancy report, The Role of CRM in Data-Driven Advertising.