What are CMO’s Saying (Part 1)
This weeks post takes a look inside the CMO Survey and pulls out some nuggets so you don’t have to read the 93 page report.
The CMO Survey collects and disseminates the opinions of marketing leaders in order to predict the future of markets, track marketing excellence, and improve the value of marketing in companies and in society. This years survey was led by Christine Moorman, Sr. Professor of Business Administration at The Fuqua School of Business, Duke University. The results were generated from 320 participants from the top for-profit companies in the U.S, 96% were VP level or higher.
When it comes to managing digital marketing returns, investments in data analytics have jumped to the top of the list, increasing almost 40% from 56.5% in February 2021 to 77.5% in February 2022. With privacy issues center stage and platform partners pulling back on what information they will share with advertisers, brands are needing to invest in resources that will help them better understand their customers. Up until last year, Facebook would gladly share insights on a brands customer as part of their investment. But now, Facebook won’t share any granular level data and expects brands to just trust their marketing tactics. We don’t think any brand should be outsourcing any part of their strategy, but especially activities related to better understanding your customers with 1PD (first party data). Investments now in 1PD will pay dividends down the road.
But how do you increase your 1PD? Many brands are investing in CDP’s which is generally a good thing. But be aware, CDP’s take time to stand up and the information within the CDP is only as good as the data you put in. CDP’s are a way to manage all of your customer data but they do not produce 1PD. So how can you get more 1PD for Marketing purposes?
- Conversational Data: Most brands are sitting on terabytes of conversational data but they don’t know how to access it. If your company has a call center, accepts email, utilizes chatbots, or has a social media presence, then you have a plethora of conversational data. This could be the most valuable data that hasn’t been touched. This is data coming straight from your customers. The nuggets in this type of data can help drive marketing efforts, ecommerce experiences, product development, and customer communication. If used properly, this data can help drive sales, loyalty, and LTV. Dashbot is a company purely focused in helping brands organize their unstructured conversational data so that it can be used to improve a brands business universally. If you don’t know what your customers are saying, how can you talk to them properly?
- Cohort Data: The word cohort has been used more times by Google over the last 2 years than during the entire history of the Internet. It is generally being used as a way for brands and tech companies to aggregate data in large enough groups that the data can’t be reversed engineered to discover attributes on individual users. Facebook lookalike audiences might be the largest cohorts being used today. The reason for this is because Facebook doesn’t let brands drill down in their audience targeting anymore. Brands can’t target on diseases, religion, political affiliation, activity, etc… This means that you just have to trust Facebook’s targeting. Even if it’s worth trusting, broad targeting like this doesn’t allow for targeted creative, target optimization, or any learning to help a brands business. ProfitWheel was created to solve this specific problem. The data brands crave is accessible via API’s but it’s not easy to get at and if you do, it’s even more difficult to decipher for audience targeting. ProfitWheel does this for brands in a transparent way at a cohort (100) level so you can target creative, generate learning, and optimize most efficiently. Brands need to optimize more granularily than at an adset level in order for Facebook to be efficient. ProfitWheel will provide you with media plans that can be executed on Facebook, Snap, DV360, TTD, etc… They even have a contextual tool that will provide you will specific URL’s Video ID’s, and keywords, all based on your customers behaviors by unpacking your Facebook lookalike audiences.
- Shopper Behavior Data: Old school Marketers will be familiar with the idea of a ride along. This is when a retailer sends an employee shopping with a customer while someone else quietly trails behind taking notes on every movement and interaction. This can help with store layout, product selection, and product presentation to name a few things. This is much more difficult to execute digitally so no one does it. If you think of your homepage as the store entrance, the department as the high-level category, the brand section as the sub-category, and the product someone picks up as the PDP this will make sense. Metrical does exactly this in a digital experience and they do it for every user, not just a panel of a select few. Metrical will observe every user that comes to your website and learn their behaviors so they know what people do before they do something else. The power of numbers is a beautiful thing. After observing for 6-8 weeks, Metrical is able to predict with 90% confidence what a shopper will do next. This means that you can intercept users during their shopping process with personalized recommendations for a better experience or by giving them a reason not to leave if that’s the path they are on. This is harder to understand because you can’t physically see the shopper but in many ways, it’s far better.
- Measurement: Brands have historically relied on media/platform partners or MTA (multi-touch attribution) for marketing performance data. These were the easiest ways to understand how effective your marketing dollars were being spent but they were never the most accurate. My assumption was always that brands didn’t want to take marketing dollars off the table for measurement. Now they don’t have a choice unless they want to fly blind. Marketing platforms should never be trusted as they are incentivized to spend more and MTA is dead. MTA relies on 3rd party cookies which is highly inaccurate and probabilistic at best. MTA companies that are still in business have resorted to making predictions based on a small set of data points. This will result is budgets being mis-allocated and you won’t realize the data is wrong until it’s too late. Brands need to rely on Incrementality testing.However, methodologies are key if the data is to be trusted. You still can’t rely on a 3rd party that has a vested interest in you spending more money with them. Measured is a measurement company that was born from MTA. These guys know how to run experiments. They can tell you which channels and partners are driving incremental sales and show you where and how much you can push into a vendor. They do this by leveraging your source of truth, your 1PD. If you aren’t using Measured or someone exactly like them (beware), then you are optimizing on inaccurate data.
Please check back next week for part 2 of this series where we will focus on experiences and how the top marketers think about it.