Why People-Based Marketing Platforms Will Begin to Dominate in 2017

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This past year laid the foundation for major transitions across the marketing landscape. Those trends will accelerate in 2017, ultimately reshaping our industry for decades to come. The drivers of that transformation are two-fold. First, we are in the “Era of Digitalization,” where all forms of media are rapidly becoming digitized — from planning to activation to measurement. That digitalization further breaks down the barriers between media channels, which leads to the second driver — an intense focus on single identity as marketers strive to create a unified view of their customer. In fact, these are the big enablers behind all the interest in people-based marketing. Ultimately, marketers want to engage real people in the real-world. In 2017, that becomes possible and the impact will be felt in numerous ways.

Single identity…the Shift to People-Based Marketing
The movement to people-based marketing will drive the AdTech and MarTech industries to rethink and redesign their platforms. This is a large undertaking, as technologies, data platforms, algorithms and more have all been built on cookie-based models, or more recently, mobile device ID-based models. Each of these give way to structures built around a single unifying identity. These single identities will have multiple devices and screens associated with them. They will also associate to households and other offline forms of identity, further enabling omnichannel strategies.

We’re already seeing the investment happen as companies race to transform their capabilities to support this new market demand. Cross-device solutions have matured and become mainstream with scale. The leading global agencies have launched large technology initiatives to build single-identity solutions within their organizations. Brands are investing in unlocking their first-party CRM data, which is all about single customer identity. As marketers pursue the simple notion of engaging real people, this single trend has the potential to drive a massive reallocation of media spend in 2017, defining a new category of industry growth leaders.

The Continued Rise of Programmatic
Marketers’ demand for self-service and automation will continue to increase as well in 2017. When coupled with the idea of single identity, it should be no surprise that programmatic will continue to rise. According to eMarketer, more than 80 percent of display ads will be transacted programmatically by 2018. Higher-quality data, differentiated data inputs and continued automation will work together to continue to fuel programmatic growth. Already, brands are leveraging mobile-derived audiences programmatically in entirely new applications. For example, CPG brands are executing shopper marketing strategies to engage customers based on the specific retailer where they shop. Furthermore, it has become easier for brands to onboard their CRM data into programmatic platforms for activation in support of highly relevant marketing programs aimed at brand loyalists or acquiring new customers.

The Digitalization of TV
TV media will undergo one of the greatest shifts in its history in the coming year. No other traditional media is as poised for digitalization as TV, and addressable TV will lead the way. In fact, by the end of 2016, US digital ad spending will reach $72.09 billion, while TV spending will grow to $71.29 billion (eMarketer). As a result, marketers are no longer looking to buy TV media based on how shows index on age and gender. They have become accustomed to buying richer audiences via digital, and now want the same for TV. Furthermore, marketers want to understand how TV performs for them, not just based on GRPs, but based on actual conversion metrics.

The TV industry is quickly building these capabilities to stem the tide of advertising budgets going to digital formats like mobile and desktop video. While digital-style planning, targeting and measurement is available for linear, programmatic and connected TV as well, addressable TV more naturally lends itself to these trends. Networks are racing to significantly increase their addressable inventory. While it will remain a small percentage of overall TV inventory, addressable will be the proving ground for the digitalization of TV in early 2017, and lead the way for accelerating adoption across all forms of TV.

Adoption of Location Data as Universal Currency for Measuring Advertising ROI
As these major trends take hold in 2017, the demand for cross-channel campaigns will continue to grow. In order to understand the performance of one channel compared to another, marketers need a universal metric that can be applied to all forms of media. For example, you can’t apply a click-through rate to TV advertising. As such, conversion metrics, like store visitation and purchase data, that can attribute performance to every ad exposure become increasingly important.

While foot traffic data is currently being used for offline attribution, it’s also being utilized for new performance or direct-response style metrics. For example, retailers, QSRs and other brands with a physical presence can calculate cost per visit and cost per incremental visit of getting a customer into their stores. Just as cost per install became the common currency for the app download ecosystem these new metrics can become the common currency for the retail ecosystem. In fact, retailers are already applying the economic value of a customer visit relative to the cost per visit of their advertising campaigns and are planning and allocating marketing budgets accordingly.

Fraud and Viewability Drive Digital Media Buying
Fraud and viewability are becoming requirements for media buying. More agencies will take GroupM’s approach and begin mandating that media partners effectively address fraud and viewability. While there are obstacles to overcome with mobile app enablement, most of these should be addressed in 2017. Quite simply, marketers want to make sure real people can actually see their advertising and actually engage with it, which isn’t surprising when viewed through the larger trend of the move to people-based marketing.

As we continue to move through this “Era of Digitalization,” and the industry makes a shift towards single identity, brands will reach a new pinnacle in marketing that not only allows them to more accurately reach and engage customers, but also to link all their campaigns across digital and offline platforms and measure their impact. Location data and physical-world behavior will be core signals at the center of this major movement as marketers gain tighter control and greater understanding of their interactions with consumers such as frequency and sequential messaging. For consumers, the move to single identity will change their interactions with brands in a very positive way, providing increased relevancy while maintaining anonymity to better align with their lifestyles, needs and interests.

david-staas-ninthdecimalDavid Staas is the president of  omni-channel audience and measurement company NinthDecimal.