How retail marketers can use data to personalize holiday campaigns

With less than 100 days until Christmas, it's time to start thinking about holiday marketing campaigns.

Recent research from Oracle Marketing Cloud and Edison Research shows consumers are doing their holiday shopping early, spending as much as $900 more during October than in December. And this week, it will be 60 days to Black Friday.

In past years, retail marketers have focused on omni-channel strategies to lure customers from all angles. As omni-channel further cements itself as a baseline expectation for the shopper, marketers who want to take their efforts to the next level will want to refocus their efforts on personalized communications.

Leveraging customer data

Data is available to everyone, but how marketers use it makes all the difference.

Retail marketers that utilize the data they have, and take a consumer-centric approach to fostering relationships with consumers, will see those relationships flourish. In addition to the data that retailers can already gather from the interactions they have with shoppers, consumers are willing to provide detailed personal information. But these customers expect more tailored services in return for their candidness.

Some benefits of personalization that retail marketers should expect include higher response and engagement rates, brand loyalty, repeat customers, amplified reach and more relevance with today’s shoppers. Putting data to work for personalization can also lead to higher conversions. According to a recent CMO Council survey, 43% of marketers said personalization led to more conversions.

This strategy is no longer limited to email marketing, and is a relatively inexpensive one to implement. VentureBeat Insight research indicates email marketing is still the dominant primary channel for consumer messaging, with 80% of marketers surveyed using it. However, other mediums are beginning to see an uptick, such as social media (42%), website landing pages (37%) and editorial content (31%).

Path to purchase shift

Consumer messaging is in many ways still the same conversation that the store owner had 60 years ago with each person that walked into his brick-and-mortar store, building up the business and clientele through intentional communications. The difference now is where the conversation takes place — it has moved into various digital forums and at a greater scale for each merchant. But the reality is that consumers still crave intimate, timely, dynamic and knowledgeable dialogues with retailers.

In fact, according to Autopilot, a 2015 sentiment survey of 1,200 consumers found that consumers are four times as likely to respond to messaging if they receive personalized offers. Respondents rated what they look for from retailers: 49% said they expect communications that are relevant to their interests.

The path to purchase for consumers has shifted in the last decade. Consumers now have multiple points of entry for getting to know retailers and are, in many cases, already hyper-informed by the time they begin interacting. A whopping 80% of the buying process now takes place before the first direct interaction with the brand. Between smartphones, tablets and laptops, consumers have massive amounts of information available with a tap, swipe or click.

Autopilot outlined a list of personalization best practices. The one that stands out the most is quite simple: "Give your reader access to content and data that helps them find what they need more quickly."

If brands want to secure shoppers, they have to go to them, on the devices they use and social platforms they frequent, and meet them with relevant (read: personalized) content and offers.

The age of the hyper-informed shopper

Believe it or not, but consumers are willing to share personal information.

New research from Aimia's 2015 Global Loyalty Lens found that 80% of consumers are willing to share detailed personal information, such as name email and nationality. Seventy percent said they would even be open to sharing details like birthdate, interests and occupation.

If a brands knows your interests, they can use that data to serve ads for products that you are more likely to already want. If a shopper says they like exploring the outdoors and sharing those experiences on Instagram, a brand could pitch them with hiking gear and the latest GoPro camera.

But there are challenges to using data to personalize marketing efforts. Parsing through data can be time consuming. Marketers are beginning to hire out data management companies to help keep track and make sense of the information streams that are coming in. And as VB Insight research points out, it is hard to truly personalize on the web, particularly since “there’s no consistent point of contact.”

But as early results become visible, VB Insight finds adopters of personalized marketing are seeing a huge difference. According to VB Insight, 87% of marketers currently using personalization tools have reported a 5% lift in their main metrics. Of the more than 400 marketers surveyed, 40% reported 20% increases in KPIs (key performance indicators), such as conversions, average order value, and even lifetime value.

Nevertheless, retail marketers have work to do if they want to put their data to good use. Advertisers haven’t quite connected the dots between tracking the data that comes from the new consumer journey and squeezing the most juice out of it. While retailers are spending more on personalization, they are largely only using what VB Insight dubs “beginner” metrics. The most common type of consumer data available includes on-site, search and social activity. The most oft-cited metrics used for personalization include email addresses (57%), name (45%), location (41%) and demographics (40%), according to eMarketer's personalization roundup.

VB Insight, echoing Aimia’s findings about what consumers are willing to disclose, points out that advanced marketers could capitalize on more advanced metrics such as real-time location data and lifestyle information.

Simply put, smarter tracking leads to smarter marketing, which leads to more loyal shoppers. To paraphrase eMarketer’s recent piece on personalization: Not having a grasp on the modern customer journey means marketers can’t target their audiences with the right message in the right place at the right time — unless they're just getting lucky.

It’s #HintingSeason

Last year, Best Buy took home the Shorty Award prize for “Best in Retail and E-commerce” for its #HintingSeason campaign. The electronics giant, in collaboration with CP+B, pushed out a social call to arms in October that drove people to post hints of their holiday wishlists online for friends and family to see using the #HintingSeason hashtag.

Not only did Best Buy win an award, but the campaign generated over 660 million impressions, with a 7.2% engagement rate. It garnered almost 50,000 organic posts from launch through December 2014 and helped increase online sales for the retailer by 13.4%. During the holiday season, Best Buy drove $10.1 billion in domestic holiday revenue, a 4.1% increase over the year prior.

Best Buy’s approach was engaging, sharable and took advantage of the fact that everybody knows how to hint — the company simply gave them permission to do so publicly and online, helping kickstart holiday sales early. A tangential benefit for Best Buy was the data from the free user-generated content it amassed.

“One of the benefits of social, as a medium, is the ability to optimize in real time. From messaging to targeting to timing, we constantly strived to publish the most engaging and best performing content we could create,” CP+B VP and Creative Director Peter Knierim told The Drew Blog.

The team tested and analyzed social data, from content strategy to message relevance, to tease out effectiveness and ROI. With this information, they were able to gauge how to improve upon the campaign in real-time and reach more customers through more specific messages. Best Buy responded to consumers' hintful Tweets and Vines, and offered shoppers relevant new products based on their interests to spur more hints and, ultimately, buys.

Best Buy tapped Vine’s influencer network, asking the app’s video stars (such as Evancredible, who has 1.4 million followers) to share their #HintingSeason posts with their followers, further amplifying the campaign’s reach.

The Evancredible Vine has 21.6 thousand likes, nearly 4,000 re-Vines (or shares) and 160 comments.

A Twitter Promoted Trend by Best Buy on Nov. 11 last year doubled the industry-average engagement rate of 3.4%, generating 57.2 million impressions and a 8.6% engagement rate. The Promoted Trend was the most successful among retail competitors in 2014. This and other, more personalized outreach on social media helped give Best Buy a nice bump through the Black Friday stretch.

The electronics retailer also selected a lucky few #HintingSeason participants and hand-delivered their wished-for gifts to them, recording the happy moments and sharing them on social.

For example, Courtney, a Brooklyn mom tweeted that she would like a Leapfrog TV for her kids, and Best Buy surprised her and her family with a box-load of gadgets. Best Buy made lifetime customers with the gesture, and the tweet has almost 300 retweets and 860 favorites at the time of this writing.

.@3BrooklynKids hinted at a new LeapTV, so we headed out to Brooklyn, NY to make her #HintingSeason wish come true. https://t.co/NWfEMWaGsF
— Best Buy (@BestBuy) November 26, 2014

CP+B's Knierem said one of the team’s favorite parts of the campaign happened after the campaign’s end. Consumers, unprompted, continued posting with the #HintingSeason hashtag, showing off the gifts they received, proving their — and Best Buy's — efforts to be successful.

Though Best Buy has not yet said whether there will be a round two this year, their campaign from last year shows that putting consumer data to work and incentivizing consumers to share can produce tangible results that benefit both the brand and the shopper.

'A golden moment' that could disappear quickly

Aimia Group COO David Johnston, citing his company's findings that businesses need to respond to shoppers today with tailored offers and communications, offered a cautionary note for brands thinking about personalized messaging.

“This is a golden moment for brands," Johnston said, "but this opportunity will quickly disappear if companies fail to respond appropriately.”