There is a dizzying amount of change taking place right now in the world of marketing, from huge shifts in consumer behavior to tracking and attribution upheavals as third-party cookies go by the wayside. And marketers are being asked to take it all in stride, while at the same time adapting to their changing role in the sales ecosystem.
The rise of what the CMO Council calls “the self-reliant buyer” has flipped much of the sales action to the top of the funnel. Close to 80% of buying consideration now happens before anyone speaks to a salesperson, according to a Cisco study cited in a report from the CMO Council. And who’s talking to consumers mulling those purchases? Marketers. In fact, the CMO Council found that marketers are now responsible for 44% of revenue on average, compared to a little more than 10% in the mid-2000s.
“More and more now the sales action is happening at the front of the funnel,” explained Tom Kaneshige, Chief Content Officer at the CMO Council in an interview with Retail TouchPoints. “It’s slowly been moving there, but the pandemic just shot it through because now everything’s digital. And because of this upended customer journey, there’s a huge opportunity for marketers because they’re the new sales organization. They’re closer to the revenue than they’ve ever been.”
A new opportunity, yes, but also a new challenge, as marketers must now find ways to engage with these increasingly autonomous consumers who demand both authenticity and a soft touch. This means shifting the focus of messaging from immediate product purchases to building relationships.
Using First-Party Data to Have a ‘Genuine Impact’
Much of what is currently happening in the marketing landscape is seen by many as a necessary course correction after years of over-reliance on third-party customer data, which was often gathered without concern for consumer privacy or, in some cases, quality.
“We all know that first-party data is significantly more valuable than third-party,” said Suketu Gandhi, Partner in the Digital Transformation practice of Kearney in an interview with Retail TouchPoints. “So why did they use third-party data? There was a classic quote — ‘They were looking for a needle in a haystack. They couldn’t find the needle, so they decided to throw some more hay.’ Everyone just kept throwing hay and hoped something would hit.”
But such methods are not only inefficient and expensive; they also have the potential to backfire in a world of increasingly savvy digital consumers. Instead, Gandhi said that marketers need to shift their attention and their budget spend toward campaigns and messaging that have “a genuine psychological impact.”
Moving Beyond Age to More Meaningful Parameters
Marketers need to move away from generic assumptions of what consumers might want and focus more on their “need state.” These targeted need states should be very specifically defined as well, with marketers using past insights to zero in on proven conversion drivers.
“What we used to do was go after every need state within a segment of age or a cohort,” explained Gandhi. “Gen X, Gen Y, Baby Boomers, those are all inventions of marketeers, and that worked for a long period of time, but it has stopped working. Now we have enough data at a high-segment level, and we can combine that with first-party [data], to go after the need states that matter. Go after the mind space, not the shelf space.
“Five years ago, doing this was insanely expensive in terms of data, the algorithms against that and the ability to deploy it,” he added. “Now all that has been solved. We have plenty of data, the algorithms are there and the computing power is cheap. And we have the ability to actually execute on it.”
These new abilities come in large part from new AI and machine-learning technologies that allow marketers to slice and dice data at a pace and scale not previously possible. These technologies allow for more nuanced targeting, enabling marketers to home in on hyper-specific consumer sets with more relevant potential and intent.
But, to quote Spider-Man, with great power comes great responsibility, which is why Gandhi warns against misuse of these tools: “With AI and machine learning you should be 120% vigilant not to use them as a weapon of mass destruction. Any wrong targeting, any improper presentation of products or solutions or language should be protected against. Now is the time for marketeers to take a leadership role in how [organizations] send messages and personalize for the consumer.”
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