Marketing is transforming; the marketing mix is changing and CPG marketers are shifting their funding from mass marketing to precision marketing.
According to recent research, 60% of US retail and CPG brands tailored digital advertising and marketing messages to deliver local outcomes, including in-store purchases. Through data and technology, marketers can optimize spending and deliver increased impact.
But in today’s competitive and complex environment, how do you evaluate the myriad opportunities available to advance to a more precise marketing model? This simple framework outlines the key areas needed to achieve precision marketing
1. Understand the who, what and why
You need rich data to accurately paint the picture of your audience and deliver relevant content through personalized targeting.
High quality demographic data (the who) helps you individually identify your audience. After you know who your audience is, transactional data can help you understand what actual products they’re purchasing. Lastly, attitudinal data identifies the motivations around why product purchase is occurring.
It is essential to bring these data sets together, at the individual level, to paint the complete picture of your audience.
If you’re only looking at one data set, (e.g. transactional data), you’ll only see one-third of the picture. This complete dataset helps fine-tune your targeting and enables you to improve campaign messaging and creative.
For example, a pasta company could execute a campaign targeting repeat purchasers where each is served a personalized message. Individuals focused on stretching their budget receive messaging centered on creating meals on a budget; while athletes receive messaging related to how eating pasta helps performance.
2. Reach individuals through smart media delivery
You’ve long been able to reach individuals with highly targeted direct mail and email. This can now be done with high accuracy for digital media.
Through quickly evolving technology, media can be targeted to individuals across devices through anonymized individual profiles. These profiles can be connected to offline data to identify people and their devices.
Once the connection has occurred and media plans are developed, smart media decisioning technology is used to reach the right individual with the right messages across devices and ad formats. The end result drives campaign effectiveness through better targeting while reducing wasted impressions. While one consumer may be more receptive on mobile devices, someone else may be checking their tablet.
In fact, a recent survey found that CPG categories like cereal, soap and cosmetics are particularly popular among digital consumers and online commerce will be the second leading driver of change over the next five years for the CPG industry. Deliver more relevant messages across devices to individuals where they consume media.
3. Measure your sales results
The last step is to close the loop through sales measurement.
Many CPG companies use third parties to measure campaign results since you need to read sales impact across multiple retailers.
There are many partners and methodologies used to deliver measurement. Typically, CPG market research teams lead partner vetting.
Once a partner is approved, you can measure campaigns to gain faster learning at a more granular level vs. your annual market mix. This provides you with more detailed insights and the ability to change marketing plans throughout the year. Getting back to the pasta example, you can measure total campaign sales impact as well as by targeted group (e.g. athletes only).
At the end of the day, marketers are challenged to drive growth– incremental volume and ROI. Precision marketing can now deliver impact at scale.