In 2014, to make our organization more inclusive to the entire advertising and marketing community, sfBIG changed its name from SF Bay Area Interactive Group to SF Bay Area INNOVATION Group. The Bay Area is known for innovation and sfBIG is here to pique your curiosity, educate, and start conversations about innovation in our industry.
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I keep hearing the phrase, “own your customer.” This is like saying that you own your spouse, ridiculous! Anyone who is married or even dated knows that it takes time and effort to really know someone. So, why do brands think if a customer bought something from them and is now in their CRM or CDP, that they own them. I would argue that you don’t even know them, yet.
Millions of people have made a purchase at Nike.com. All Nike really knows about them is what they bought and where they live. They can infer gender but that’s really it. Just because someone buys a running shoe, that doesn’t mean they are a runner. Perhaps they are a fashion statement or they use them just for walking. Maybe they were a gift. Regardless, a person is more than a purchase. One hundred people could buy the same shoe today but that might be the only thing they have in common. Each person has a different composition. Maybe there is a cohort that works in the medical profession, drives a sports car, and also likes hiking. Another cohort might be a business professional and like science. The point is that it takes time to get to know someone and their purchase behavior is just one piece of who they really are.
Thousands of brands have or are in the process of investing in a CDP or upgrading their CRM. This is a good thing but simply setting these up doesn’t give you anymore information about your customers. You need to continually fill these databases with information about your customers. The more that you get to know your customers, the deeper your relationship can become with each of them. It’s like dating, if you rush things, the other person might be turned off.
Several months ago we purchased a sofa from a company called Valyou Furniture. Since this purchase, I have received 4 SMS messages per week promoting additional furniture, often times more sofas. I haven’t made another purchase, ever. This brand is tone deaf and turning me off. If I haven’t engaged, slow your roll. Better yet, find ways to get to know me better. In November, I purchased a smoker from All Things BBQ. Now I receive 1-2 emails per week with recipes. If I like a recipe, they make it easy for me to buy the products I need. They also ask me to submit recipes and share my experiences with them. I know this is self-serving for them, but it also has value to me. With each recipe I read and purchase I make, they are learning more about me. As good as this is, they don’t know much else about me. On the flip side, I bought a grill from BBQGuys around the same time and they slam me with emails and SMS constantly and half the time they are pushing grills on me. Whomever managers their email and SMS programs really needs to learn how to segment better. Nonetheless, they don’t really know anything about me.
So in a world of “privacy first” and relationships second, how is a brand going to build long-lasting relationships with me? I used to be a member of Trunk Club. I would visit their LA location when I was down their on business and meet with my personal stylist. Her name was Stefani and on each visit, she would learn a little bit more about me, my family, my job, etc… She took her time and built trust so that then we could have a long-lasting relationship. I understand that this is easier to do IRL but still, not everyone takes the time. This doesn’t mean that brands can’t think about customer relationships the same way. The key word to CRM is RELATIONSHIP and there is more to a person than what they bought.
DTC brands have been hit the hardest by all the changes to privacy law and the changes made by Facebook in June of last year. DTC brands relied heavily on the precise targeting and reporting capabilities that Facebook offered. When the changes went into effect, campaign performance seemed to tank. However, it’s been proven by brands like Measured that Facebook can still drive incremental sales, just measuring it is more difficult. These changes made Facebook a black box. Brands no longer have the deep insights into their customers that they once had. Now Facebook says, “give us your customer file and we will find more people that look like them.” Many brands are at the mercy of Facebook so they reluctantly went along with it. But is Facebook the company you want to trust? Facebook is out to maximize revenue and drive just enough performance to keep you coming back for more. But if a brand is spending money on any platform, they should understand who they are targeting, what their composition is, and what is working at a cohort level. With this information in hand, brands can strategically target the right consumers with the right message. This will drive even more conversions at a much lower overall cost. If brands have deeper insights into their customers, they can begin to build relationships with them and meet them where they are. If you sell shoes on Facebook, wouldn’t it be helpful to know that there is a large cohort that likes to ski? This kind of information can lead to better messaging and product development.
Brands need to target based on the interests of their consumers. I don’t mean the interests they checked off 10 years ago when they signed up for Facebook. I mean, what are they reading today? What have they posted? Where have they visited? And they need to look beyond Facebook. What do they search for on Google. What do they buy on Amazon? What do they like on TikTok? Your customers are three dimensional so take the time to learn about them from all angles. How do you do this, you ask?
ProfitWheel is Cogent’s newest partner. They are bringing the AdTech and MarTech worlds closer. PW makes it very simple for brands to instantly gain a deeper understanding of their customers and then builds them several cohort audiences to target in their effort to acquire new customers. And unlike others in their space, they don’t charge a percentage of media. They want brands to use the data anyway they can, as much as they can. To get started, all a brand needs to do is give ProfitWheel access to their Facebook Business Manager so they can gain access to the brand/clients audience set. ProfitWheel will then unpack rich and granular audience insights such as audience passions, cohorts that work for a brand and those that dont etc. to help you unravel and discover your next most valuable audience. ProfitWheel acts as a layer of intelligence over native platform consoles to place you in control of your data and allow you back into the driver’s seat of your campaigns. Plus, the tool’s deep intelligence will increase your ROAS and LTV as you continue to build relationships over time by deciphering your next likely performing cohort and help you expand insights globally. Cogent members can get a heavily discounted trial so talk to us.
Measure To Grow
- Measured Provides clarity on the true incremental contribution of every media channel, campaign, and tactic, using transparent and proven experiments designed for each unique platform. By measuring across all channels at once via a 3rd party incrementality partner, 1+1 will always equal 2.
- ProfitWheel analyzes your customers to deeply understand who they are and what they look like online. To remain privacy compliant, ProfitWheel aggregates your customers into cohorts after they discover what they read, post, and buy online. You then use this data to buy look-a-like audiences in an open and transparent manner so you can continuously be optimizing. Your CPM’s will be less expensive than if you were to leverage Facebook’s black box methods and you will drive more sales revenue while spending far less. Best of all, you can use this information to buy media on other channels and contextualize/personalize creative.
- Hunch is a creative services tool that helps brands and agencies scale their creative for every campaign through audience personalization and contextualization. You can leverage your ProfitWheel data, weather, geography, time of day, sports scores, and several other attributes to help your creative resonate and stop the scroll with display or video..
Is it Personalization or Contextualization?
How Important is Personalization?
As an industry, we have overused the term “personalization” to a point where it has lost its meaning and purpose. Now, changes in our industry and law have made personalization something that is more difficult to do, but maybe that is a good thing. These changes have forced us to rethink how we communicate with our (potential) customers. Over the last 10 years or so, we have used the term to describe how we could retarget a shopper. If they leave your shopping experience after looking at a pair of shoes, we would chase them around with those or similar shoes, even long after they were no longer in market for those shoes. At the time, this made sense because this is what the technology allowed us to do. But that doesn’t mean it was the best use of the technology. I think most brands did this because their competitors did, so they felt like they had to.
Personalization is still very much important, but where we do it, how we do it, and when we do it are 3 very important questions we need to ask ourselves when developing our strategies.
Should We Continue to Attempt to Personalize Advertising?
Laws and privacy policies are making 1:1 messaging within advertising very challenging, but not impossible. Where you are able to message in a 1:1 manner, the audiences will be very small. However, some brands may find it beneficial to speak directly to the ones they can. For most though, developing contextually relevant campaigns might actually perform better. This isn’t a new concept by any means. I recall as a teenager seeing a TV ad for a movie on ESPN that focused on the sports story and action within the movie. But then, I saw an ad for the same movie during one of my sisters soap operas that focused on the romantic relationship in the movie. This blew my mind and made me question everything about advertising. Perhaps this is where I got my first nudge into this industry and career.
There is certainly a place for 1:1 personalized messaging. If I am shopping for something that is a considered purchase (regardless of price), sending me a piece of direct mail that highlights the benefits of that product can be extremely impactful. This has worked on me several times and it’s why we are partners with PebblePost. But if you want to capture my attention for something that I haven’t thought about or want to get me to a website that I haven’t visited, a contextually relevant ad will be the way to go. Much like the TV ad I described earlier, brands today need to make their ads align with the content. The most simple way to do this is to have the content of the ad align with the programming or editorial content around the ad. For example, On ESPN, Expedia should run Ewan McGregor ads about remembering where you visited, that focus on viewers traveling with their favorite team. On the Food Network, the ads should focus on culinary experiences around the world. Expedia doesn’t do this to my knowledge so I always seem to get the same ad. This is a missed opportunity.
Prioritize the Personalization of Your Website Experience
Consumers will be more apt to give you their personal data if you use it to make their experience better. Too much personalization in your ads can creep people out, but too little personalization on your website will reduce loyalty and repeat purchases.
As with any relationship, it takes time to learn details about the person. In personal relationships, you remember and use data such as, birthdays, anniversaries, favorite colors, foods, places, things, etc… so as a brand/Marketer, why wouldn’t you do the same within your relationship with a consumer? Don’t use data for the sake of using data but use it wisely to create a better experience.
Here are some ways to personalize a shoppers website experience:
- Offer Engagement Opportunities: 1:1 Video Shopping Experience can make shoppers feel special. All the attention is on the shopper and you are able to learn about their preferences so you can recommend the right products, grow the cart, LTV, and loyalty all at the same time. Due to the pandemic, eCommerce adoption accelerated but as things get back to normal, eCommerce will continue to grow for the brands that offer the right experiences. Check out FEEL if you want to learn more about these types of offerings.
- Make Communication Easy: Pretty much every eCommerce website has some sort of chat experience but more often than not, these experiences fail to do what they were intended to do. Some simply offer a web form and then take up to 24 hours to respond. Unless you offer something I can’t get somewhere else, you will lost my business. Most other chatbots aren’t taking advantage of all the innovation in this space. Your chatbot needs to know all the possible questions and variations of those questions that shoppers ask or it will fail. There are advanced analytic tools like Dashbot that can help you understands what questions are failing so you can be improving your bots in real-time. A good chatbot experience will minimize the escalation rates to a real person and reduce failure rates where people just leave. Both will lead to higher conversion rates and more repeat purchases.
- Help Shoppers Find What They Need: One of the biggest challenges for shoppers and brands is matching products together to make everything work better. If I am shopping at Dick’s Sporting Goods for workout clothes, the last thing Adidas wants me to see is a pair of Adidas pants with a Nike shirt, and New Balance shoes. Having me wear these together is even worse. And quite frankly, as a consumer, it will be a big turnoff to me if you show me these brands together. Companies like FindMine help brands and Merchandisers pair together the right products from across your entire catalog so I have a better experience, the brand has a better experience, and the retailer sells more and provides a better shopping experience. Most people aren’t fashion designers and don’t know how to match products the way professionals and technology do. The same is true for home decor and cosmetics.
- Speak to Shoppers, When They Need to be Spoke Too! Brands today start popping up ads the minute you land on their website. This is a huge turnoff for me. Why would I give a brand my email and phone number before I even know if you have what I want. Then they follow up with pop-ups throughout my shopping experience because they are worried that I am going to abandon their website. This is a fair concern because the data supports it but unnecessary pop-ups will drive me away even more quickly. In a physical store, Associates can see when someone is in need or about to exit so they can engage with them at the right time. Within eCommerce, brands need to leverage data to predict when some is about to leave so they can react accordingly. Companies like Metrical focus on these types of predictions and methods for engaging with users with the messaging they need to convert and build Loyalty:
- Incentivize with Loyalty: Having a loyalty program is one thing, having a loyalty program that generates ROI is another. It’s not enough to simply give points away with each purchase that convert to dollars off in the future. Modern day loyalty programs should be a way for you to build a relationship with each shopper, over time.Your customers should be your biggest advocates, but you need to make them feel special and incentivize them to do take different actions that benefit everyone involved. Companies like Zinrelo do this far better than those keychain cards Petco used to give out…
- Use Your Data but Be Smart: Brands today have data all over the place, including but not limited to their CDP, CRM, ESP, in-store DB, loyalty, etc… Brands need to leverage someone like Zembula to pull data from all their sources and organize it in email and SMS messaging to make every email personalized. Their Smart Banner tech helps brands do this within their email or SMS without having to change the content for every single user. You and I may receive the same promotions but the smart banner will show us our individual loyalty points, product preferences, and previous purchases to consider. There are so many use cases that I will stop there and let you use your imagination.
Your Marketing and eCommerce Friend
The Most Overused Term in Marketing and eCommerce?
As the co-manager of an innovation lab, we get to speak with Entrepreneurs all the time about their innovative technologies that leverage AI and Machine Learning. I have heard this phrase so many times now that I roll my eyes when I hear it. It’s unfortunate because there are so many great technologies that do leverage AI and ML. The problem is, the phrase can mean different things to different people. These terms are so commonplace that they have become innocuous and now serve little meaning when they are used.
Where can AI be used in Marketing and eCommerce?
In my view, the term AI is an evolution from the term “Big Data.” This terms was overused from 2010-2015 and caused the same effect on me, eye rolling. However, AI is able to do what humans cannot possibly do and that is to make sense of Big Data. 2.5 Quintillion Bytes of content is created daily. I cannot tell you how big that is but I know with certainty, no human can sift through all of it in a lifetime. This is where AI can play a huge role in marketing and ecommerce.
If you manage just one brand’s marketing and eCommerce business, you are collecting an enormous amount of data on a daily basis. Consider your SEM, Social, Display, Video, Audio, TV, and email marketing campaigns. How many different consumers do you touch within each channel? How many interactions do you have with them? When they come to your website, how many products do they view, how much time do they spend on each page, do they add to cart? Do they buy? Are they a previous customer? I could go on but you get the point. So how do you leverage all this data to drive those conversions, find even more consumers, and keep them coming back to buy more? The answer is AI.
Communication is another area where brands can really benefit from AI. Chatbots are becoming more and more popular but all of us have had a bad experience with them. However, when a customer or shopper needs to speak with someone, a good experience can be the difference between making a sales or not. Acquiring a new customer or not. This impacts ROAS, LTV, and margins. The more people that need to touch a consumer prior to a purchase, the small the margin earned. You can start with a chatbot by pre-loading the most common questions asked to your customer service teams, email support, or website support. This will instantly reduce your escalation and failure rates. But don’t stop there, leverage analytics technology to help you understand what else people are asking and how they ask things differently. Clustering questions together can create efficiencies. This can all be done with AI. AI can learn from prior communications and help you activate learning from ongoing communications. You just need to know who the players are and how they all differ. This is where a relationship with an innovation lab comes in handy.
Data privacy and data quality are two very important topics that don’t always show up on the bottom line. It is best to work with point solutions that think about these topics all day long and have the staff to manage them. With these comes data cleanliness and data management. You can’t do this alone unless you have unlimited resources. Your main job is marketing and selling products, not managing data, so use a partner.
Here are some ways that AI is used within Marketing and eCommerce
- Bidding on Programmatic Media Buys
- Selecting the Right Message
- Granular Personalization
- Chatbot and Conversational Experiences
- Predictive Marketing Analytics
- Marketing Operations
- Dynamic Pricing
AI will replace people within many tasks, especially within Data Science and Communications. This shouldn’t scare anyone. If you are good at what you do, there will be a job for you. Automation will help companies and industries scale, much like the Internet has over the last 30 years. The most successful people will be the ones that understand the technologies and learn how to use it to their advantage. Here are a list of companies leveraging AI to help Marketers and eCommerce leaders maximize their returns while limiting their expenditures:
- Dashbot: Chatbot Analytics company that is agnostic to which bot you are using. By implementing their findings into your bot, you will reduce bounce and escalation rates dramatically
- FindMine: Merchandising entire product catalogs together based on detailed availability, brand identity, and customer preferences. When implemented on PDP’s or other marketing messages, you will increase engagement, convert more shoppers, increase ROAS and LTV.
- Frequency: Personalizing audio messages based on any number of data inputs, from geo to specific audience segmentations. When implemented across multiple streaming platforms, your messages will be cohesive, your CPM’s will decline, and your ROAS will increase. As an added bonus, creative development and distribution will be easier.
- Hunch: Social Creative Personalization based on every element within the creative and its historical performance. This will stop the scroll and lead to higher engagement rates.
- Measured: Measuring incremental lift holistically across all your media channels and tying ROAS from each to your source of truth so 1+1 always equals 2. They also help you understand where you can efficiently scale your efforts. In a world without cookies or IDFA to stitch together the consumer journey, this is your best option.
- Metrical: Predicting when a user is about to leave your website, just prior to leaving so you can intercept and persuade them to convert. This will reduce the amount of retargeting you need to do while increasing ROAS and make the customer happy.
There are obviously many more companies that leverage AI and ML. These are vetted and proven technologies. If there is another one that you are considering, we would love to know about them.
Written by Sean Simon, Communications Chairman @ sfBIG
The Metaverse; What, Why, and How
What Exactly is the Metaverse?
So we shouldn’t get hyped up over the term “Metaverse” because for now, it’s just a branding vehicle for all things virtual. Facebook (Meta) is just trying to own something that really isn’t ownable. It took me a while to understand and appreciate NFT’s but I think I get it now. I am not going to run into the Metaverse and buy any, but I get it. The same people that bought bitcoin early on are likely the same people buying NFT’s now. If you aren’t sure what an NFT is, it stands for Non-fungible token. These are digital items that are unique. They must be one of a kind to be non-fungible. They are purchased and managed using blockchain technology (which needs to be a separate post) so to ensure and guarantee its uniqueness. Most of what we hear about today is digital art but it could really be anything. I can see a world where every brand has their own collection of NFT’s as a way to build brand equity outside IRL. Just like with real art, NFT’s can be copied but there can only be one original. Check out the details on the Gucci Ghost below:
Coming back to the Metaverse, for now, just think of the Metaverse as anything that provides a digital experience. This can be a full immersive experience like on an Oculus, a 3D experience like Roblox or Minecraft, a PC game, or even a mobile game with specific characteristics like 3D immersive technology. From an advertising perspective, there are plenty of opportunities today. There are custom built experiences like American Eagle Outfitters created with Anzu inside Roblox to in game product placements to programmatically inserted ads. Check out the AEO Country Club Experience and an integrated Nike ad below. Both are in the Metaverse but at two different ends of the ad spectrum.
So why should you care? Should you engage now as a brand or should you wait and see? You should care because the Metaverse isn’t going away. It may change shape over time, just as the Internet has, but it will be around. If you haven’t ever tried VR, you need to if you want to fully appreciate what it has to offer. Computing power will continue to increase and this will just lead to better and better experiences. Money is flowing into this space from every direction so we should see exponential changes over the next 5 years. Meta (Facebook) alone has invested over $10 B into the Metaverse and some experts forecast that the Metaverse presents a Trillion dollar opportunity for brands.
Contrary to what some believe, the Metaverse isn’t just video games for the kids. There are applications for business, design, and sports just to name a few. Brands that jump in now will cement their positions and earn the business of their target audiences. Those that wait may feel like they are saving money but in the long run, they will have to play catch up and that will cost even more. My advice, if you aren’t sure what to do, dip your toes in with programmatic ads and measure the impact. If you see positive results, increase your budgets and engagements next year and the year after. Perhaps some day soon, we will be able to have this conversation in the Metaverse and share ideas in a virtual world that feels like real life. The truth is, we probably already can do this… Check out Anzu and let Cogent know if you would like to learn more. This is our preferred partner for advertisers and we can help you navigate this seemingly confusing universe.
Podcasting and Streaming Audio
Podcasting and Streaming Audio in general has grown 30% year over year since 2018 and is expected to grow at this pace over the next decade. This week we will focus on the creative and analytics that can help brands scale within this channel.
Audio is one of those channels that old but yet new again. For decades, radio was only available on your AM/FM radio and the SiriusXM changes the game with digital audio and eventually streaming digital. Now we have players like Spotify, iHeart, and Pandora putting their own spin on digital audio. The race now is for podcast content. If you are just entering this channel from an advertising perspective, it can be difficult and confusing. But fear not, Frequency can help. I like to compare the audio channel to display so follow me for a second.
In the early days of display (mid-late 90’s), we purchased display ads directly from publishers. In the beginning, no one had an ad server and then DoubleClick came along. In the 2000’s, ad networks came on to the scene and made it easier for buyers to consolidate their budgets and IO’s wit one network that could target a specific genre of websites. Then in 2009-10, ad exchanges really started to take off, making programmatic buying the choice of buyers. However, it wasn’t easy to understand, buyers and agencies learned how to do it well and now almost all media is bought programmatically.
With audio, many advertisers started with buying a single host-read podcast or made a network buy from iHeart or Spotify. Starting with one of these platforms can make a lot of sense as you are in the learning phase. The rate at which we evolve is much faster now. Today, a buyer can place an audio buy via The Trade Desk or other exchange and target their audiences with data or based on content. You will pay a premium for Spotify and Pandora, no doubt and they may be worth it for your brand and strategy. However, if you want to find the same or similar audiences and save 50-100% on your CPM’s there are many other networks and exchanges you can buy from. The perceived challenge is that measurement, tracking, and analytics will be challenging to stitch together, but this is where Frequency comes in.
Frequency helps advertisers personalize and contextualize audio creative with built in workflows and partnerships. Then, Frequency can serve your ads to the right people and/or along with the right content just like you serve video ads with a 3rd party (VAST). This allows all your analytics and measurement to be aggregated in one place so you can optimize media and creative with ease, even with Spotify, iHeart, and Pandora. Given all the challenges with tracking cookies and IDFA, why not try an old but new channel withs scale and ease, before your competition does?
Let us know what your experience has been with audio or if you want to learn more. We can always help make connections.
Written by Sean Simon, Communications Chairman @ sfBIG