Identity Marketing

By Marsha Appel, SVP, 4A’s Research Services, marsha@4as.org.

 

Identity. All of a sudden, that word is appearing everywhere in the marketing literature. Identity-based marketing, Identity resolution, Identity solutions. These concepts really snuck up on us. Could it be that the word ‘Data’ is in danger of being supplanted? (Just kidding, Data; your place is secure).

Still, in The Forrester Tech Tide: Martech for B2C Marketers, Q2 2018, Forrester cites Identity among the 20 technologies underpinning modern marketing, and states that identity resolution is the literal foundation for all marketing activities. Moreover, in the past month, there have been at least three major studies published on the topic.

More than three-quarters of marketers are taking steps to implement identity-driven marketing efforts, according to the CMO Club. The ANA and Winterberry Group report, Know Your Audience: The Evolution of Identity in a Consumer-Centric Marketplace, says that U.S. marketers will invest almost $900 million in 2018 on services and solutions dedicated to identity solutions, and that number will balloon to more than $2.6 billion in 2022.

What exactly is Identity Marketing? Here is what you need to know.

Put simply, identity resolution is connecting all the dots, taking a single piece of contact data about a person (e.g., e-mail address, social media handle, cell number), and connecting it to signals from that same individual across other channels and devices in order to recognize that individual anywhere, build a psychographic and demographic profile, and develop a deep understanding of that person’s interests, preferences, attitudes, brand affinities, etc.

Identity-driven marketing is using that ‘whole person’ understanding to recognize that specific individual wherever and however they interact, and present them with tailored and consistent messaging at all promotional and transactional touchpoints.

Where did it come from? Well, one may consider it the offspring of market segmentation and data.

A few words about market segmentation. It was introduced in the 1950s as a process of putting prospective customers with similar characteristics into discrete groups to be more efficiently targeted by marketers. Market segmentation gradually shifted from focusing on understanding a particular group’s needs to a much more complex analysis of lifestyles, values, and so on. But while it serves as a guide to strategy development and has long been recognized as an effective marketing tool, it is limited to dealing with groups of consumers.

Enter sophisticated technology, the ability to collect much more detailed data on individual consumers, and the advent of one-to-one marketing, and voilà: Identity marketing.

For its part, data has historically come from various disconnected sources, which has hindered efforts to generate a holistic and actionable view of a target consumer. What’s relatively new, although still a challenge, are tech advances that facilitate synthesizing the disparate data inputs to enable identity resolution, which can amplify traditional market segmentation exponentially.

Done properly, Identity resolution allows marketers to:

  • Delight and engage customers with personalized offers, thus reducing churn
  • Identify and attract desirable new customers by matching detailed characteristics of elite customers to those of prospects—“look-alike targeting”
  • Verify e-mail addresses, winnow dupes, and weed out bots and fraudulent ads

Identity solutions, the mechanics of implementing identity-driven marketing, is the coordinated activation of platforms, data, and services that support persistent recognition of audience members across all devices and touchpoints. The most common application of identity solutions currently is the development of audience insights for segmentation and targeting, but there is recognition that there is potential to serve many business purposes in the future, including cross-channel attribution and dynamic content personalization.

Do consumers want this?

According to Adlucent:

  • 60% of consumers expect brands to deliver tailored customer experiences
  • 70% say they prefer content and ads customized to their interests and shopping habits
  • 43% report an increased desire for personalization in the past year
Challenges

Data issues. Consumer desire for personalization is all well and good, but it is offset by privacy concerns (Adlucent also reports that 96% of consumers want brands to be more transparent about their collection and use of personal data), government scrutiny of data collection and use, and other regulatory issues. Successfully embracing identity solutions will require solving the myriad data protection and usage challenges coming from the public sector, as well as extremely complex internal issues related to data collection and ownership among the many players in the marketing data ecosystem.

CMO skills. The CMO Club reveals in a new report, The Quest for the Perfect Identity-Driven Marketer, that traditional CMO skill sets may not translate to success in the new identity marketing world. Because it’s a new discipline, no one yet has years of experience in it. The report describes the perfect identity-driven marketer as “a renaissance marketer who possesses a rare but valuable combination of skills and insights,” and expresses skepticism that any existing single candidate would have the necessary skills required to deliver both personalized marketing and customer experience. The CMOs interviewed for the report agreed that the ideal identity-driven marketer would demonstrate the following traits:

  • A tech/data mindset
  • Proven innovation in other channels
  • Coalition-building across the entire organization
  • Good working relationship with IT counterparts
  • Strategic thinking
  • Ability to prioritize

So what does this mean for agencies? There is certainly a role for agencies that can navigate through the complex data issues to facilitate identity resolution, and that can support client CMOs dealing with an ever-expanding set of skill sets required to succeed at identity-driven marketing.

 

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