The profound generational shift taking place in the realm of marketing has been a harsh awakening for brands and agencies. Research demonstrates that 74 per cent of UK consumers are concerned about brands being able to view and track their online behaviour to target them with advertising.
And despite regulatory interventions, such as the GDPR and the UK’s Data Protection Act, only one in four (27%) say they completely understand how their personal data is used by brands and companies to target them with advertising online. This lack of trust and transparency regarding the usage of their data is causing consumers to opt-out at an increasing rate.
Even more, brands that have been “renting” customer data from third-party data sources and then relying on external digital identity graphs to match their data with ad platforms are no longer viable as data privacy laws and customer preferences evolve.
If that wasn’t enough, browser restrictions on cookies and mobile ad IDs and privacy-first browsers are growing and affecting identity-focused marketing. And the walled gardens of Amazon, Google, Facebook and major retailers are making it challenging to take data out for use elsewhere, inhibiting cross-channel planning, buying and optimisation.
Data fragmentation and the paid media pinch
In essence, data accessibility is becoming fragmented. The cohesive fabric of customer identity, interwoven through third-party sources, is losing strength as identities become superficial, duplicated and fragmented.
Let’s break it down:
- The data rental market is collapsing, threatening almost every form of online behavioural advertising: The third-party data that the ad ecosystem was built on is collapsing. The only reliable data left for marketers to base their strategy on is their own first-party data and publisher’s data, sourced directly or via second-party marketplaces.
- The media buying ecosystem is experiencing a reset: Even as effectiveness goes down, costs are still high. The bidding language DMPs/DSPs/ad servers use to communicate in real-time with each other is broken over concerns about customer data leakage.
- Identity resolution across channels is more and more challenging: It’s a consequence of the deterioration of third-party data and Apple IDs, and it results in far lower match rates when trying to acquire new customers.
Sure, paid media channels like Google Ads, Facebook Ads, etc. can effectively reach current and prospective customers. However, the most effective way to use these channels going forward is with first-party data, which results in higher match rates and future-proofing benefits. Your existing customer data allows you to target consumers with relevant content that will increase organic interaction and make them less likely to view the ads as spam. Win win.
Embracing privacy by design with first-party data
Progressive brands are actively distancing themselves from inferring behaviours, context and intent through invasive and questionable tracking mechanisms. Instead, they’re deploying ‘privacy by design’ within a first-party data strategy, ensuring that data collection is based on consent and usage is transparent to consumers.
To gather valuable insights, they are implementing tactics that encourage customers to willingly share their data in exchange for meaningful perks or benefits. Compelling calls-to-action (CTAs), such as captivating offers, exclusive content or personalised recommendations have the ability to inspire action and foster engagement.
By embracing the power of first-party data and steering away from questionable practices, digital marketers can proactively establish a foundation of trust and provide exceptional experiences that effectively convert anonymous visitors into loyal, known customers. This approach far surpasses the alternative strategy of seeking loopholes around cookies through various third-party solutions.
Moreover, digital marketers are exploring alternative digital media buying modalities to navigate the changing landscape. Connected TV and streaming platforms offer new avenues to engage with audiences whilst adhering to privacy standards. By embracing these emerging channels, they can deliver targeted messages to consumers in a privacy-safe environment.
In addition, alternative targeting approaches, such as contextual targeting and leveraging publishers’ data are gaining momentum. Rather than relying solely on individual user profiles, marketers are tapping into the contextual relevance of content and the aggregated insights provided by publishers. This approach enables them to reach their desired audiences effectively whilst respecting privacy boundaries.
Unified customer profiles: A true game-changer
To tap into the contextual relevance of content and harness the power of publishers’ data, marketers face the critical challenge of connecting the dots and creating a unified view of their customers. This is where identity resolution takes centre stage. It acts as the missing puzzle piece, allowing them to stitch together fragmented data points, eliminate duplications and gain a holistic understanding of their target audiences. And it’s key to building a successful first-party data strategy.
However, very few providers can actually muster the technical capabilities, legal compliance and financial resources to deal with data deprecation. Whilst an abundance of data may seem promising, critical questions arise: Is it accurate? Is it clean? Is it comprehensive?
Amidst this uncertainty, one critical provider capability emerges as a game-changer – a unified customer profile. Acting like the brain and memory of the modern digital marketer, a unified customer profile holds immense value. It merges identified first-party data into one coherent source of truth that reflects all customer online/offline touchpoints and interactions with a brand, both current and historical. This is especially crucial for larger retailers whose majority of transactions still happen offline or in stores.
Leveraging a unified customer profile, marketers can
- Gain a complete and accurate understanding of customer behaviours, preferences and needs
- Develop increasingly personalised and relevant marketing strategies that enhance customer experiences and build relationships, which boost lifetime value
- Mitigate risks, costs and time associated with third-party data assets
- Measure activation impact on KPIs
By having control of their customer data, brands and agencies can pursue customer-centric planning, mapping and sequencing paid media interactions to consumer journeys down the funnel. Unifying online and offline data sources also increases first-party data signals.
Unlock the first-party data advantage
A significant rupture exists in the value exchange between brands and consumers. With heightened expectations, consumers now demand improved transparency in the utilisation of their personal data. If these expectations are not met, they are likely to reconsider engaging with a brand.
Consequently, paid media teams that embrace a first-party data strategy, constructed upon unified customer profiles and implemented in privacy-safe manners, have the potential to generate higher revenue by providing enhanced customer experiences. By prioritising the responsible and ethical use of data, these teams can foster trust, loyalty and satisfaction among their customers, leading to increased profitability and business success.
Unlike other approaches that use fixed and brittle matching rules, Amperity’s patented, AI-powered identity resolution and unified customer profiles build a complete view of customers that increase match rates, drive suppression and retargeting and generate high-value audience segments.
This foundation allows digital teams to quickly build targeted segments, directly activate with leading ad platforms and effectively measure the impact of digital ads across online and in-store purchases.
Superior data equals superior results
Amperity’s paid media campaigns have proven to be a game-changer for customers, yielding remarkable outcomes that leave a substantial impact on their bottom line. Leveraging its industry-leading ad connectors and patented unified customer profiles, renowned global brands have witnessed match rates as impressive as 85 per cent across vital channels. Even more, they’ve also improved return on ad spend (ROAS) by up to 5X and experienced up to 90 per cent faster activation time for new campaigns.
With Amperity for paid media campaigns, major brands such as Alaska Airlines, Reckitt, SPARC Group and Wyndham Hotels & Resorts are experiencing increased return on investment (ROI). Let’s take a closer look:
- SPARC Group, a long-time Amperity customer, experienced a 5X ROAS, using predicted CLV (customer lifetime value) for segmentation.
- Wyndham Hotels & Resorts saw double-digit growth in ROAS in activated targeted audiences.
- Alaska Airlines experienced a 21% cost savings in paid channels.
- Reckitt, a global Consumer Packaged Goods (CPG) company, has seen a 30% improvement in match rates and significant uplift of seed audience size, leveraging its customer data in Amperity.
First-party data: The yellow brick road to boosted customer acquisition and ROI
Whilst the best time to unleash the power of first-party data and unified customer profiles was yesterday, the next best time is now. Brands and agencies that act swiftly and strategically in adopting these practices position themselves for success in a privacy-conscious era.
As the marketing landscape continues to evolve, those who embrace the transformative power of first-party data will forge ahead, delivering exceptional customer experiences and reaping the rewards of long-term growth.
Matthew Lubeck, Vice President EMEA, Amperity
Matthew is the vice president of EMEA where he is responsible for the commercial expansion of Amperity, a leading customer data platform trusted by brands like Reckitt, Under Armour and Wyndham Hotels & Resorts. Lubeck joined Amperity in 2017 to help launch the company and has served in a number of key roles building sales, customer success, and marketing functions. Matthew established Amperity’s LGBTQ employee resource group (ERG) and is a trusted advisor and customer-centricity change agent to the C-suite across leading consumer brands.
Prior to Amperity, Lubeck spent 10 years with global beauty conglomerates Estee Lauder Group and L’Oréal as Group Head of Customer Data Strategy and Analytics, leading 30 brands across luxury, mass and salon professional divisions to better use data & unlock incredible beauty experiences, establishing L’Oreal as an industry leader. He resides in London with his husband and four-year-old daughter.
About Amperity
Amperity delivers the data confidence brands need to unlock growth by truly knowing their customers. With Amperity, brands can build a first-party data foundation to fuel customer acquisition and retention, personalise experiences that build loyalty, and manage privacy compliance. Using patented AI and ML methods, Amperity stitches together all customer interactions to build a unified view that seamlessly connects to marketing and technology tools. More than 400 brands worldwide rely on Amperity to turn data into business value, including Alaska Airlines, DICK’S Sporting Goods, Endeavour Drinks, Planet Fitness, Seattle Sounders FC, Under Armour and Wyndham Hotels & Resorts. For more information, visit amperity.com or follow us on Linkedin, Twitter, Facebook and Instagram.
