This Industry Viewpoint was authored by Mark Lederman, Sr. Director Product Mgt, Synchronoss
Telco data for advertising holds extraordinary promise for brands. As a mobile carrier, if you aren’t using your wealth of data – particularly location data – to help companies drive more effective, targeted advertising, you’re missing out: missing out on greater profits from new revenue streams and casting aside the opportunity to establish your company as a long-term marketing partner. The terabytes of telco data stored, and too often highly siloed, have tremendous value and can be used by advertisers desperate to effectively connect with consumers.
Until recently, digital data—most often from Google and Yahoo—has centered on spending and demographics. But this is a long way from the very specific data that can paint a detailed picture of users’ likes, dislikes and habits by location. Demographic data points, like age and gender, don’t provide the kind of highly specific information to enable targeted advertising campaigns that location data offers. To overcome this, brands are increasingly considering mobile carriers as potential marketing partners due to the high quality and trusted nature of their data.
Carriers certainly have a primary responsibility to protect consumer information, but carrier data can be used in ways that both respect privacy and comply with legal constraints. A range of techniques are used to mine relevant data while removing or obscuring details that must remain private. Only non-personally-identifiable, anonymized information is provided.
It just takes some knowledge—and some effort educating brands about the opportunities—to monetize the original source data at your fingertips.
Personalization, humanization and beyond
There are three main areas where carrier data is invaluable to advertisers: inputs personalization, contributions to humanization, and unprecedented access to content.
Nowhere is personalization more critical to effective advertising than in the digital domain. Every day the average user is bombarded with offers and promotional information. It takes only seconds to decide if content is relevant and the message appeals to our particular sensibilities. Failure to resonate means lost prospects – in a flash. The personal behavioral data based on usage that carriers possess is invaluable to advertisers. This data can also be used to reflect more humanized approaches and language, which are essential to driving more effective digital marketing.
First mile data capture is all too often ignored, but can yield tremendously detailed mobile behavioral data ranging from device information, user-generated content, travel/commuting patterns, app usage, and more. The last mile, including delivery of contextual messages such as ads, offers an education through push notifications, banner ads, inbox ads, and in-app ads, are all used effectively.
The role of analytics
Much can be discerned from petabytes of raw data. In addition to gleaning insights, advertisers can use test campaigns to optimize the offer, message and channel – continually working to refine the insights, personalization, and delivery of their outreach.
There are a number of variables that can identify user behavior and help guide advertising. For example, location data can determine how much time a consumer spends in the car and at what times of day, as well as reveal what they’re perusing. User-generated content, including texts and emails, can also reveal a wealth of information. For example, we might learn that person X is spending 25% of their time talking and sharing information with others about a professional sports team. Artificial intelligence can be used to take this data and create ideas about users – their likes, dislikes, and habits that are extremely valuable to advertisers.
How advertisers can drive value
Companies know that better targeting increases their chances by utilizing existing finite impressions available in the market. Improved context for the end user leads to higher take rates and higher CPMs. Comparing a traditional approach versus a more targeted campaign methodology illustrates the dramatically improved results possible with targeting.
Say a large retailer wants to target a million customers interested in baby products. In the traditional approach, the retailer might send one ad to the entire group, paying a CPM of $5 (or $5K) and receiving a respectable 0.1% response rate at a cost of $5 per response. In the targeted model, the retailer might send 10 different ads to buckets of 100,000 customers by targeted more specific products to each (diapers for one, pull-ups for another, etc.). In this scenario, the retailer pays a CPM of $10 (or $10K) and receives a response rate of 0.4% at a cost per response of $2.50 due to the improved targeted. Multiplied over several campaigns, and it’s easy to see how these savings quickly add up. That translates into real dollars for brands.
What carriers need to know
To make the most of the data at their fingertips, carriers need to understand the basics of analytic segmentation and targeting or enlist the help of a partner to help manage and package data. Telcos should also grasp advanced testing techniques such as experimental design. Traditional A/B testing doesn’t achieve the personalized approach and results of running many different types of campaigns. Optimized rotation of ads allows marketers to have more ads present in an ad group and therefore increase the chance of finding the right match. Response uplifts of up to 400% over control group testing are not uncommon when combining new computing power and targeting techniques.
Now is the time to explore using telco data to diversify your business, grow your revenues and form lasting partnerships. There’s too much to gain to not pursue it.