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Optimisation is the New Black

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We see trends come and go, buzzwords reach fever pitch and the latest tech platform saturate the market before they have even delivered on their promise. Is Optimisation the new ‘black’? We think yes, but like all ‘next big things', we all struggle to integrate this technique into BAU and leverage it to make our marketing dollars and effort more cost effective. Find out how, download the presentation

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Optimisation is the New Black

  1. 1. Optimisation is the new black.
  2. 2. DIGITAL EXPRESSO | NOVEMBER 2016 “Optimisation… is the new black” | Forbes Magazine 2015
  3. 3. DIGITAL EXPRESSO | NOVEMBER 2016 “Math… is the new black” | Econsultancy 2013
  4. 4. DIGITAL EXPRESSO | NOVEMBER 2016 “Content… is the new black” | Content Marketing Institute 2011
  5. 5. DIGITAL EXPRESSO | NOVEMBER 2016 “Big Data… is the new black” | Said everyone 2013
  6. 6. DIGITAL EXPRESSO | NOVEMBER 2016 “Mobile… is the new black” | Everyone still saying
  7. 7. DIGITAL EXPRESSO | NOVEMBER 2016 “[Insert Buzzword]… is the new black” | In this industry there’s always a new black.
  8. 8. DIGITAL EXPRESSO | NOVEMBER 2016 An act, process, or methodology of making something (as a design, system, or decision) as fully perfect, functional, or effective as possible; specifically : the mathematical procedures (as finding the maximum of a function) involved in this. SOURCE: www.merriam-webster.com/dictionary/optimization Optimisation: [op-tuh-muh-zey-shuh n]
  9. 9. DIGITAL EXPRESSO | NOVEMBER 2016 We see there being two distinct kinds of digital optimisation: Optimisation through Testing vs. 1. A X Y X show they did Optimisation through Personalisation 2.
  10. 10. DIGITAL EXPRESSO | NOVEMBER 2016 What we’re talking about today: A X Y X show they did Optimisation through Personalisation 2.
  11. 11. DIGITAL EXPRESSO | NOVEMBER 2016 Personalisation is all about relevance. what you want to say what they’re interested in Relevance
  12. 12. DIGITAL EXPRESSO | NOVEMBER 2016 And it’s easy right?
  13. 13. DIGITAL EXPRESSO | NOVEMBER 2016 We’ve got the…
  14. 14. DIGITAL EXPRESSO | NOVEMBER 2016 So why are we struggling? We think there are two key reasons why.
  15. 15. DIGITAL EXPRESSO | NOVEMBER 2016 Which makes governing the digital experience difficult and limits the depth that we can personalise. 1# The majority of tools are rule-based.
  16. 16. DIGITAL EXPRESSO | NOVEMBER 2016 It’s a mapping exercise. Where does this need to happen? Where Homepage, Category page, Product pages What is the single most distinguishing factor about the audience? Audience Prospect What other things can digital tell us about this audience to paint a clearer picture of their needs? Attribute 1 Attribute 2 Life Stage (single) Age range (20-30) What digital information can the website gather to understand what the audience is trying to achieve? Scenario Looked at a credit card 3 times in the last 5 days If a person demonstrating this intent walked into a branch, what would the customer service rep do/say? Business Rule Re-assure with brand and product value proposition What is the digital version of this? What needs to change on the site to deliver on the business rule? What Change tag lines in relation to Life Stage andAge Range Audience Attribute 1 Attribute 2 Scenario Business Rule What Where
  17. 17. DIGITAL EXPRESSO | NOVEMBER 2016 Audience segmentation can make rule based get big fast… 16 Geotribes 9 life stages 2 genders 8 age ranges 5 defection scores 11,520 combinations =
  18. 18. DIGITAL EXPRESSO | NOVEMBER 2016
  19. 19. DIGITAL EXPRESSO | NOVEMBER 2016 So it gets put in the too hard basket…
  20. 20. DIGITAL EXPRESSO | NOVEMBER 2016 What needs to happen to help deliver personalisation with more complex audience segments?
  21. 21. DIGITAL EXPRESSO | NOVEMBER 2016 Automation. Advanced machine learning algorithms. Automated personalisation uses visitor data to match the most relevant experience with a given visitor (basically “letting the machine do it for you”). It’s really useful when you are not sure which rules are most effective – so its solves that ROI problem. Over time, the algorithm learns to predict the most effective ‘thing’, for example content to achieve your goal. This is what the tech giants use to personalise the digital experience. Think Facebook, Netflix and Amazon – in fact Amazon originates 35% of sales through it’s automated personalisation strategy.
  22. 22. DIGITAL EXPRESSO | NOVEMBER 2016 Are there any Australian brands playing in this space?
  23. 23. DIGITAL EXPRESSO | NOVEMBER 2016 Australia Post saw a 35% uplift in conversions using automated personalisation. It’s a big risk to dedicate resources and budget to automated personalisation experiments. We helped Australia Post engineer a test to determine if automated personalisation would work better than rule-based. The automation experiment used a random forest algorithm to determine the best content to show a visitor based on their behavior. The test proved that automated personalisation did in fact drive better and faster results than rule-based automation – resulting in a 35% uplift against the control. We are now helping Australia Post scale-up automated personalisation across the wider business.
  24. 24. DIGITAL EXPRESSO | NOVEMBER 2016 Should all Australian brands roll out automated personalisation?
  25. 25. DIGITAL EXPRESSO | NOVEMBER 2016 Automation can be costly and resource heavy – and probably not a viable option for every day Australian brands just yet. =
  26. 26. DIGITAL EXPRESSO | NOVEMBER 2016 So our advice, if you are tackling personalisation is to start simple.
  27. 27. DIGITAL EXPRESSO | NOVEMBER 2016 Start here. SOURCE: HUGE INC. Business rules-based logic. Manage the process between rule-based logic and algorithmic includes operations, analytics, content and testing. Machine-based, algorithmiclearning to make personalised recommendations.
  28. 28. DIGITAL EXPRESSO | NOVEMBER 2016 Just pick 1 audience. Pick one scenario, for example Repeat Customers. Lets not make this too big – we don’t want to build 11500 variations to start with.
  29. 29. DIGITAL EXPRESSO | NOVEMBER 2016 Do we know: • what they just looked at? • if they abandoned something? • what they bought last? Don’t over complicate it. A lot of the time, people jump to the end goal – the vision, and that’s when it’ll get complex. Start with the most differentiating thing you know about a visitor.
  30. 30. DIGITAL EXPRESSO | NOVEMBER 2016 Companies are not ready to invest in the people power needed to run personalisation. 2#
  31. 31. DIGITAL EXPRESSO | NOVEMBER 2016 A typical adoption curve.
  32. 32. DIGITAL EXPRESSO | NOVEMBER 2016 What makes a difference? People.
  33. 33. DIGITAL EXPRESSO | NOVEMBER 2016 “Technology, data, strategy. These are necessary elements to make personalisation function…
  34. 34. DIGITAL EXPRESSO | NOVEMBER 2016 But people — the importance placed on developing and enabling talent in your marketing organisation — they are what make personalisation thrive and succeed.” -SOURCE: SCOTT BRINKER
  35. 35. DIGITAL EXPRESSO | NOVEMBER 2016 To succeed there must be a willingness from stakeholders and management, giving permission for teams to try and fail (and oodles of platform training). ‘Doh!’ ‘’Whoops!’ ‘Darn it!’
  36. 36. DIGITAL EXPRESSO | NOVEMBER 2016 “Optimisation… is the new black” | Digital Balance 2016
  37. 37. DIGITAL EXPRESSO | NOVEMBER 2016 Start here. SOURCE: HUGE INC. Business rules-based logic.
  38. 38. DIGITAL EXPRESSO | NOVEMBER 2016 Thank you. www.digitalbalance.com.au Digital Balance Melbourne +61 3 9020 7340 Perth +61 8 9227 8073 hello@digitalbalance.com.au

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