Thank you to the thought leaders who contributed to this article:
Evan Nicholson, Digital Experience Practice Director, Merkle
Jen Karlson, Commerce Strategist, Merkle
Megan Lalonde, Sr. Relationship Marketing Strategist, Merkle
Michela Baxter, Sr. Director, Promotions & Loyalty Solutions Practice Development, Merkle
Mike Adamson, Sr. Manager Experience Strategy, Merkle
Timea Szell, Sr. Manager Digital Experience Strategy, Merkle
In part one of this series, we talked about stepping away from the reactive marketing of the last two years and how brands can be more proactive in 2022. Strategists from our Commerce, Digital Experience, Digital Messaging, and Promotions & Loyalty teams identified two important themes for marketing success in 2022: transparency and authenticity and first-party data and personalization.
Be sure to check out part one of this series where we discussed transparency and authenticity if you haven’t already. Today, we’ll dive into how to utilize first-party data and personalization for success this year.
First-party data and personalization
Collecting data is the best way to listen to your audience at scale. Their behaviors and habits tell you exactly how they want to interact with your brand and provide enough detail to build a personal relationship. But if any of your data comes from third parties or cookies, it’s time to pivot to first-party data. According to Forbes, third-party data will be obsolete by the end of 2022, and data privacy legislation continues to gain traction across the United States. So, let’s dig in.
First-party data: listening at scale
First-party data is widely accepted as the gold standard of data collection because it gives control back to consumers to determine what data they want to share with brands and how they want it to be used. If you’re wondering how to start collecting first-party data, the answer is simple. You just ask. Consent is at the center of data collection, but you also need to provide a good-enough reason for consumers to hand over their data. They’re smart and they know they data holds value. We call this a value exchange. You want something from the consumer, so you have to give them something in return.
A value exchange involves offering economic, convenience, social, altruistic, or entertainment benefits. For example, many retail brands offer discounts to consumers in exchange for sharing their email addresses and opting into marketing communications from the brand.
Our strategists noted that most commerce brands are currently under-utilizing their data because it’s stored in different locations, and there isn’t cross-communication to allow brands to find trends or create a single view of the customer. For example, customer service calls and interactions, operations, and on-site behaviors can all provide insight into who is actually interested in your brand and what they want from you. However, the power in leveraging all of that data can only be used if those systems are communicating to one another. A customer data platform (CDP) is the first place to start in 2022 if you want to begin building a first-party database. Once you have a central location for consumer data, you can create personalized experiences and interactions.
Personalization: activating your data
Personalization is a strategy for creating unique, one-on-one interactions with your audience. After you have your data collection and storage strategy sorted, you can focus on segmenting that data to narrow down what will make the best experience for your different customers. You can segment data based on channels of communication, product purchases, and engagement frequency.
While Merkle digital messaging experts anticipate email to continue to be a widely used platform, they also recommend ramping up your SMS capabilities this year. As consumers crave app-free experiences, they are more eager to interact with brands over text messages. Our promotions and loyalty experts also encourage brands to build out their gamification strategy to better engage audiences. Gamification utilizes game mechanics and engagement drivers to intersect consumer motivations with business outcomes. It’s a great strategy for offering the value exchange we talked about earlier.
Perhaps the most future-focused recommendation for this year is to start experimenting with the metaverse. If you want your brand to be part of the early adoption, now is the time to test campaigns and experiment with how your company can engage consumers in a virtual play space. As more consumers join the metaverse, your brand will be ready to interact with them at scale.
If you’re looking for additional guidance throughout the next year, check out Merkle’s 2022 Customer Experience Imperatives. In this year’s imperatives, we dive into expanding your vision for customer data, using measurement as a catalyst for change, and delivering commerce experiences that drive next-gen loyalty.