2012 1 27 adaptive marketing


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The Article 29 Working Party is busy shaping the future of Europe. If you haven’t heard of this group don’t panic; it’s not the sinister new villainous organization in the latest James Bond movie. Rather it’s the European Union’s predictably dull but highly influential data-protection advisory group, who are leading the charge on the new EU Privacy Directive, due for imminent interpretation and implementation by each local EU market.

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2012 1 27 adaptive marketing

  1. 1. by Norm Johnston
  2. 2. The Article 29 Working Party is products and services. Imagine a world where Amazon couldn’t recommend books youbusy shaping the future of Europe. If you might like? Such draconian restrictions onhaven’t heard of this group don’t panic; it’s data usage are actually under considerationnot the sinister new villainous organization by some markets.in the latest James Bond movie. Rather it’sthe European Union’s predictably dull but To be fair the majority of consumers realizehighly influential data-protection advisory that in return for some of their informationgroup, who are leading the charge on the – whether anonymous behavioural or opt-innew EU Privacy Directive, due for imminent personally identifiable (PII) - brands can dointerpretation and implementation by each a much better job adapting their productslocal EU market. and associated marketing to better meet their unique needs. According to the UK’sWithout a doubt it’s a good idea to regulate latest fast.MAP/DMA Data Tracker, whereand legislate when it comes to people’s some relationship with the brand exists up toprivate information. Certainly the Internet 75% of consumers would be happy to sharestill at times resembles the Wild West; greater personal information; 62% would do likewiseconsumer understanding, consent, and if they are simply in the market to buycontrol over usage of their data is critical to something.further growing all aspects of the Internet,whether usage, online advertising, or At Mindshare we have a name for thise-commerce. accelerated data-driven and consumer- focused mentality: Adaptive Marketing, which At the very heart of this is an approach that enables marketers to truly adapt their activities in rapid and unparalleled issue is arguably the future of ways to meet their consumers’ interests and marketing itself. needs. Not just advertising but every part of a brand’s marketing mix to make its product(s) more relevant and beneficial to everyone involved. And it all depends on data.However, similar to the USA and othermarkets, privacy has become a politicalhot button, which has led to the usualscaremongering and dispersion of misleadinginformation. The good news is thatgovernments are collaborating with industryleaders, including the likes of the IAB, Googleand WPP, to come up with a sensible solutionthat balances consumer privacy concerns withlegitimate marketers’ wishes to create a moreeffective and impactful online experience.Why is this important? At the very heart ofthis issue is arguably the future of marketingitself. Without a proper – simple, intuitive,legal, ethical - online exchange of data, bothconsumers and brands will find far reachingimplications to not only advertising but also Live Dashboard Applicationthe way they buy, sell, create, and configure
  3. 3. Take advertising. Via AdaptiveMarketing advertisers can now optimize boththeir media and creative to ensure consumersare getting more relevant content both onlineand offline.For example, using tools like our Livedashboard, Mindshare can now instantlyassess both slow-moving analogue andfast-moving digital data to determine whereconsumers will most likely value and engagewith a brand’s advertising and content. Offlinemedia such as TV can now be optimizedbased on assessing real-time proxy metricslike Twitter activity, Google searches, andFacebook posts related to a TV spot. A recentGroupM/Thinkbox study in the UK showed that20% of the total response to a TV campaign isdriven immediately online within 10 minutes “Upper funnel” marketers may be inclined to relegate such talk to theirof exposure. Of course many of these online direct-response oriented colleagues. However,destinations have adaptability in their DNA, in an increasingly digitally-connected mediaeach with either paid, owned, or earned ecosystem, even those with brand objectivesopportunities to adjust brand content and will face pressure to use Adaptive Marketingadvertising on the fly. methods to increase their engagement levels, video views, and Facebook “Likes”. Mindshare can now instantly Advertising is of course only one element assess both slow moving analogue of Adaptive Marketing. Consumers are and fast-moving digital data using their personal data to adapt brand relationships in a variety of ways. For example, marketers have been experimenting with online adaptableCreative messaging can also be adapted packaging for years. Jones Soda was one ofinstantly; technology like WPP’s Xaxis, the early pioneers of customizable labelsCollective’s Tumri, and Google’s Teracent (great for wedding gifts!). Others have sinceenable advertisers to assemble ads in real- jumped on the band-wagon. Everyone fromtime based on a target audience’s behaviour Kleenex to Frosted Flakes now offer some formand preferences. Mindshare is even using of adaptable packaging of their products.social data to adapt ad units. Our Shanghaioffice recently launched Social DNA 1.0, adigital display ad unit that dynamically syncswith users’ public profiles from QQ, Ren Renand Sina to create a personalized brandedexperience for users. Visible World brings thissame dynamic ad configuration capability totelevision. For example, Lufthansa can nowadapt their TV spots featuring different callsto action, images, destinations, and pricingbased on different household profiles andtheir physical location. Kleenex Personalised Tissue Box
  4. 4. Pricing has become infinitely beverage by mixing together existing Coke products and then sharing their favouritemore dynamic. Groupon and other such creations with their friends via Facebook. P&Gcrowd-sourced Web sites bring consumers and Starbucks have set up communities ontogether to influence and dictate product Twitter and Facebook to solicit new productpricing. Dell regularly uses Twitter to offer ideas to feed into their product developmentnew price promotions based on analysing teams. Even notoriously secretive companiesconsumer sentiment. Many companies, most like Apple are rumoured to use buzznotoriously the gaming industry, analyse monitoring and consumer sentiment tools toGoogle search query volumes to predict sales adapt their products based on user likes andand consumer demand, important factors dislikes. Likewise at Mindshare we routinelywhen establishing pricing models. use such buzz monitoring tools not only to inform our client’s media activity but also Even notoriously secretive to feed into their product development and companies like Apple are customer service teams. rumoured to use buzz monitoring and consumer sentiment toolsLast but not least marketers are also usingdigital data to adapt their actual products.Nike lets runners customize their trainers viaNike ID, while millions of people routinelyuse My M&M’s to adapt the colour and texton their favourite candy. Coca-Cola hasintroduced their Freestyle vending machines,which enables consumers to create their own Coca-Cola’s Freestyle Vending Machine Leveraging Real Time Data
  5. 5. Is all this adapting worth age of margin-pressures and the constant threat of commoditization, some level ofit? A marketer’s level of adaptability is Adaptive Marketing may be a necessity ratherdependent on many variables such as the than a luxury or one-off experiment.product’s complexity, brand positioning,and purchase consideration levels. In Becoming an Adaptive Marketer can requireshort, marketers must ask whether an serious structural changes. For example, theAdaptive Marketing approach would bring entire media process - budgeting, planning,incremental value to their consumers and buying, and optimizing - needs to becometo the company. In fact, some luxury brands more fluid and “always-on” rather than staticmay actually benefit from their inflexibility and sporadic. Brands need to develop a libraryand elusiveness. For others the benefits of of creative assets – images, calls-to-action,Adaptive Marketing can be enormous: many applications – that can instantly be deployedof our clients are seeing a dramatic increase into advertising units when required.in sales with lower CPA’s while others arebuilding a powerful army of Facebook fan Fortunately offshore creative productionadvocates. facilities like WPP Deliver and our own Mumbai Mobile Centre of Excellence enable Processes need to be revised marketers to scale these asset libraries atto reflect the need for speed and low cost. Processes need to be revised to reflect the need for speed and rapid iteration.rapid iteration. New technologies should be adopted to handle the complexities of managing real- time data, marketing and pricing rules,What all marketers should consider is the asset distribution, even packaging andthreat from new companies with adaptability manufacturing. Companies will also need tobuilt into their DNA, e.g., Adorable Diapers hire new talent, including nimble uber-geeksfor customizable nappies, the Cereal Club for used to acting on rapid streams of incomingyour perfectly blended mix of cereals. In an data.
  6. 6. While all of these components areimportant, none is more critical than data,which is why you should be aware of theArticle 29 Working Party and other such There are only two sourcesgovernmental bodies. of competitive advantage: the Data is ultimately what will enable marketers ability to learn more aboutto give consumers the best content (includingads), pricing, products, and experiences. Used our customers faster than theethically it will bring rewards to everyone competition and the ability toinvolved. It’s not necessarily a new idea. JackWelch, the former CEO of GE, once said that turn that learning into actionthere are only two sources of competitiveadvantage: the ability to learn more about our faster than the competition.customers faster than the competition andthe ability to turn that learning into action Jack Welchfaster than the competition. Who knew Jackwas our first Adaptive Marketer.