You’ve heard it before: this is the year of mobile (again), says Michael Twomey, SVP and MD at people-based marketing for Signal in this opinion piece. But before your eyes glaze over, consider some important insights about mobile advertising that were recently unveiled by Mary Meeker in her annually-anticipated Internet Trends Report.
Meeker states that advertising on the internet is accelerating quickly because of (you guessed it), mobile ads.
The growth of mobile ad spend is already tremendous but marketing spend is actually still “over-indexed” on other ad formats like TV when considering where consumers spend the majority of their time consuming media.
The bottom line is a $22 billion mobile growth opportunity in the US alone as marketing spend catches up with where consumers are.
It’s the same story here in Australia with PWC’s latest annual Entertainment & Media Outlook predicting that mobile advertising will account for 41 percent of the total internet advertising market by 2020, which represents $7.4 billion in mobile ad revenues.
But with this growth opportunity comes a catch. Meeker also reported on ad blocking – most of which is done on mobile devices. PageFair findings show that mobile ad blocking grew 94 per cent YoY to 420 million users globally, while desktop ad blocking increased just 16 per cent to 220 million users as of March 2016.
Marketers shouldn’t be too surprised by that – after all today’s hyper-connected consumers have high expectations, short attention spans and a long list of brand suitors at their fingertips. They don’t have the patience for mobile ads that annoy them, take too long to load, and suck up their mobile data.
If companies really want to make the most of the $22B mobile advertising opportunity, then building meaningful, useful, and personalised experiences across devices must be a top priority.
It is this premise – the idea of meeting consumer needs by being more relevant and contextual – that is driving the next wave of digital marketing. Cookie-based approaches that use browser-based bits of code not made for mobile devices will soon be replaced by people-based marketing.
This new discipline uses first-party data to reach and engage customers with immediacy and relevancy wherever they are across any device.
Brands are already sitting on a tremendous amount of precious first-party data which can be a gold mine. Over two-thirds of marketers in a recent Signal survey said that first-party data provided the most powerful campaign lift and the highest increase in customer lifetime value – which is great news for brands chasing a lift in their return on advertising spend.
Magic happens when first-party data is used to reach customers at precisely the moment that they are in the market for a product of service. This is people-based marketing, and it’s getting a lot of buzz at the moment for the following reasons:
1. It targets customers with pinpoint accuracy
Consumers are a tough crowd these days. Their expectations of brands are higher than ever, especially when they’re online and banner blindness is on the rise.
People-based advertising is powerful because it uses the wealth of information brands already have about their existing customers to reach the right person with the right message. It gives digital advertisers an easy-button for instant relevancy and targeting efficiency.
2. It cuts the fat from ad spend
I know no-one wants to hear Wannamaker’s seminal “Half the money I spend on advertising is wasted. I just don’t know which half” quote again but the fact is that targeting broad demographic segments or unreliable collections of web cookies leaves heaps of room for error.
By linking ads to people, rather than cookies or device IDs, people-based advertising enables brands and media agencies to “buy” only the people they want to target.
3. It counts on real people for real results
The cookie-based tracking methods that have been used for 20 years don’t work well across web and mobile devices, wreaking havoc on their ability to target ads and measure outcomes with accuracy. According to a 2015 Econsultancy poll of digital marketers worldwide, less than one-third are capable of recognising customers across web and mobile.
People-based marketing solves the cross-device challenge by tying back campaigns to actual people. So advertisers know who they are reaching, who is converting, what campaigns are driving conversions, and which audiences and campaigns are driving more revenue.
4. It takes advantage of the highest-quality data
People-based marketing is powered by the most fresh and accurate data that a brand can use: its own first-party data. In a recent Signal study, 82 per cent of marketers said they plan to increase their use of first-party data this year because of the value it can add to their customer understanding and engagement.
Because first-party data is based on the brand’s direct interactions with customers, it is the key for deriving immediate, unique and granular customer insights – authentic insights advertisers will never glean from assumptive third-party “lookalike” data.
5. It sees the entire customer journey, not just one stop
As customers engage with brands across the web, mobile apps, email, brick-and-mortar stores and other touchpoints, they may be represented by multiple fragmented profiles. A people-based approach pulls all this online and offline data together to create a single view of the customer.
Advertisers can therefore understand the cross-channel, cross-device habits of customers and the different steps they take on their path to conversion.
Meeker’s predictions certainly offer a bright outlook for mobile advertising. But, if companies don’t consider how to deliver better mobile experience, the $22B opportunity results in billions of dollars in wasted spend, instead.
The entire advertising ecosystem – brands, media buyers, and publishers – needs to embrace a people-based approach for precision targeting across devices, which will deliver relevance and improve return on advertising investments.