Organisations have never had so much customer information, and yet in many cases they have never had less of an idea about how to achieve effective customer engagement, according to Harry Parkes, product director for WHY from VisualDNA, who here explains why e-commerce marketing is often poor on insights and action despite being so rich in data.
The missing piece to date has been understanding customer personality and motivation. It is useful to track what a customer browses or when he buys. But how much more valuable is it to understand the motivation of those purchasing customers? To create a profile of those individuals most likely to buy based on a range of emotional criteria, from aspirations to openness and interests; and to use that profile to automatically tailor marketing activity?
According to Parkes, the use of psychometric profiling to determine the motivations of core customer groups in conjunction with tight integration into ad platforms and ecommerce systems is transforming the quality and relevance of the online customer experience and driving new levels of customer engagement.
Taking business online has been great for sales and for profit margins. But it has without doubt incurred a long term business cost - channel fragmentation and customer disintermediation. As a result, for the past decade digital businesses have invested heavily in improving customer engagement; in creating the personal relationship; and transforming the relevance of every interaction. But with how much success? While businesses can without doubt gain insight from customers' online behaviour, this information is usually two dimensional focusing on the what and the where.
Tracking where a customer came from and how much time was spent on a page provides no real understanding of who the customers are or why they embrace certain behaviours. Effectively, despite the petabytes of data now being collected, we often have little idea about who is buying our product.
It also provides the marketing team - and CMO in particular - with limited insight into how and where to prioritise activity and invest the budget. The result is fragmented marketing strategies - with teams pulled from analytics to optimisation, from paid search to email campaigns. So how can the CMO evolve from today's fragmented marketing budget and ad hoc personalisation strategy toward a model that uses actionable insight to deliver measurable ROI? The answer is understanding who is buying; and that means moving beyond just demographics and understanding psychographics.
Organisations have always wanted to understand why a customer buys a product - or wants to buy a product - and this data has been gathered for many years using focus groups and one to one interviews. But while a focus group can suggest whether a group of customers is looking to buy a product for a specific reason, the brand has no insight into whether these individuals are actually making a purchase online. Understanding customer motivation and intent is fine but it is just a part of the story; and out of context it provides little value to a CMO looking to effectively allocate digital budget and build up customer rapport.
It is the ability to tie a deep understanding of these personality drivers with purchase behaviour that fundamentally changes the game. Integrating psychographic profiling with the end to end customer experience information - from browsing history to purchase - provides a marketing team with the quantitative certainty required to understand exactly who is buying from them and how.
Critically, it provides the marketing team with actionable insights that can determine where the marketing budget should be allocated; which customer groups should be prioritised; and supports on-going product development by delivering the motivational insight alongside behavioural.
So how does a business tie emotional intent with sales behaviour? Emotive segmentation is providing a new way of understanding the motivations, aspirations, attitudes and value of customers. For example, is an individual buying a new smart metering system to reduce household energy costs, driven by environmental principles or simply an early adopter to fuel a love of new gadgets (or all of the above)?
Understanding motivation transforms not only the way in which a brand can engage with customers - but also the timing. By analysing the customers buying a specific product, spending over a certain amount per basket - or any other key criteria - the brand can identify the shared characteristics. Armed with this understanding of the key motivations of the target customer group it is then straightforward to target marketing activity at individuals with the same profile, via paid for search or display activity, for example.
Critically, there is no need to wait for an individual to put something in the basket or make a payment - the usual triggers required to begin some form of content personalisation. Instead, tailoring the customer experience can begin long before a consumer reaches your site, within search or display ads, and continue onsite. For example, an individual with a strong Openness personality trait typically likes risk taking and is open to adventure - and is therefore far more likely to be interested in a safari or backpacking around India than an all-inclusive package holiday on the Med.
The key to this model is enabling a psychometric data layer within the existing digital marketing activity. This is based on the 'Big Five' personality traits, or OCEAN (Openness, Conscientiousness, Extroversion, Agreeableness and Neuroticism), framework for psychometric evaluation. This rich data set can be tightly integrated with a raft of tools already used by the majority of digital businesses, from Google AdWords and A/B and multivariate testing solutions, to analytics platforms such as Adobe Analytics (SiteCatalyst), email service providers and display side platforms. These integrations make it a simple process to plan and deliver campaigns to specific customer audiences based on their behavioural data.
This insight into the motivations of key customer groups can transform your marketing focus. The marketing team immediately has proven insights into the profiles of target customer groups, allowing campaigns to be automatically triggered through the existing digital marketing portfolio to engage these key customers - while looking ahead, the depth of motivational understanding of the overall customer base can support strategic planning, even product development.
Critically, not only does the marketing team now have a new depth of customer understanding but it has insight that drives actions - from defining the personality traits of target customer groups to seamlessly engaging far earlier in the customer purchasing cycle by targeting specific versions of display ads. It is by using this insight and early engagement that brands can begin to significantly improve the overall customer experience and provide individuals with a relevant interaction that is a more akin to the traditional in store face to face experience than the bland, one-size-fits all that has dominated online to date.
So, what next?
Brands know that to truly engage with people requires an emotional connection. But to date it has simply been very difficult to join up the motivational insight provided by offline focus groups with online browsing and purchasing behaviour. At the same time, CMOs have been pulled from one digital marketing initiative to another, yet still failing to create that depth of customer understanding required to maximise the value of marketing activity.
By evolving beyond basic demographic information and sales history toward a far more detailed understanding based on an individual's psychometric profile, marketers can make more intelligent and informed assumptions about the personality profiles and intents of otherwise unknown customers. And by tightly integrating this insight with the existing tools in use within marketing, marketers can also engage with these individuals far more effectively and far sooner.
Embedding motivational insight within the existing digital marketing portfolio finally enables the CMO to make sense of the marketing budget, prioritise activity and create actionable insights that deliver measurable return on investment and realise that vision of a truly engaged digital customer base. Critically, it enables the brand to make every customer experience personal, relevant and enjoyable, ensuring both brands and consumers win.