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Advertisers are at a measurement crossroads of sorts in 2023.
Device and browser blocking, as well as government privacy changes, are curtailing unique user reach on some of the well-known advertising platforms. This is increasing customer acquisition costs and severely limiting measurement of campaign activity beyond the first or last click—which has never been an accurate indicator of engagement or conversion. Omnichannel campaigns, too many bots and black-box platform forecasting has made measurement more of a directional exercise than one sufficient for hardcore evaluation of results.
With economic factors necessitating tighter scrutiny of ad dollars, how can marketers digitally target their key audiences more precisely and tie their investments back to actual business results?
Living in a multichannel world
In our omnichannel, multi-device world, many advertisers have concluded that they must find new ways to execute multi-touch measurement.
Multi-touch considers all touch points along a user’s path to purchase, not just the first or last click. However, the problem with multi-touch attribution is that it often means multi-touch across more than a single platform. To state the obvious, most marketers today use more than one platform to run campaigns. With cookie deprecation becoming more real every day, the industry hasn’t aligned upon a standard key to match across platforms at scale, and the so-called universal IDs literally only address half the audience due to match rate limitations. This makes measurement a forecasting exercise based on incomplete data.
Proof of omnichannel performance is about individual engagement, not cookies or devices. The common denominator must be the person, the audience member independent of the marketing tactic or platform.
Last-click measurement has hung on for a reason. More sophisticated measurement models like multi-touch are notoriously tricky to implement based on the investment required by the organization and the impact on internal process changes. Orchestrating IT involvement, analytics staff, behavior changes and likely new investments in technology—it can be a difficult pill to swallow for the C-suite when ROI is more of a promise than a certainty. Navigating massive data files or paying a third-party provider to do it for them layers on even more uncertainty and cost.
However, after all these hurdles are addressed, if there’s still an organizational mandate for measurement and attribution, it should include a path to inform optimization of the active campaigns, rather than weeks, if not months, after the fact.
In service of marketing to more accurate audience members
The inconvenient reality of digital advertising is that most brands have to settle for reaching some, but not all, users in their target audience. This reality may serve as a drag on the performance of some national new customer acquisition campaigns, but it is often overcome (or masked) by enough impressions and spend.
Member marketing is a different animal. The compelling part of digital outreach to members is that a contact may only cost the marketer one-tenth of one cent. Contacting a member by direct mail can cost $2 or more. So it’s no wonder that large and medium-sized member organizations like health insurers, telco companies, regional banks, as well as auto and home insurance firms line up to figure out a way to deploy digital in service of their members.
The challenge of member marketing is reach and measurement. When onboarding member files, marketers are blind to who they can reach online and who they can’t—that’s a problem. If they are blind to who they can reach on one platform versus another—that’s a problem. After spending time and money to reach members, they are still blind to who was reached and who was not—that’s a problem. Taken together, without a coherent identity strategy, the backbone of institutional business becomes dramatically less efficient for categories in consumer retail, finance, insurance, energy and businesses with their membership.
If the beauty of the digital advertising business model is that it provides cover for a lot of mismatches and inefficiencies in the customer acquisition process, the favorable economics can really turbocharge member marketing results because brand familiarity assures engagement. Consider the margin gains for acquisition and cross-sell programs that can be realized if a member outreach campaign can be properly executed and deterministically confirmed across the entire member file by channel and tactic.
A digital member marketing example
Health insurance providers must regularly communicate with their customers. Whether through direct mail, email or digital, they advertise to a finite universe of insured members.
Communicating with members digitally is dramatically more cost-effective, allowing more frequent and effective outreach. Through onboarding, members can be segmented into three to four distinct groups: highly engaged across multiple digital media platforms, preferred social platform engagement, email only and members not available online. The highly engaged can be segmented by platform preference or higher platform impact channels such as CTV. Social members can be allocated to Meta. The members who have no digital footprint can be designated to receive a postcard.
The point is, if this health insurer only has to spend 10% of their budget on email, they can reach the 90% as many as 10-15 times over a longer period and still save over 70%, compared to what they would have had to spend going strictly with direct mail.
Putting member services marketing into practice
Setting up a digital member services marketing strategy involves a clear-eyed look at three key metrics:
- What is the true match rate of members in the onboarding process? Which specific member records matched and which didn’t? If there is no match, the marketer can consider email or some other tactic to make sure they achieve full reach.
- For the matched records, does the marketer know which members can be reached on which DSP or media platform? Just because there is an ID doesn’t mean the consumer is reachable on every DSP or social platform. This is go-no-go information if marketers use more than one media platform.
- Does the marketer have a next-day match-back methodology in place to deterministically confirm reach at a member level? Member reach, frequency capping across platforms and conversion tracking at the record-level is important for optimization of messaging and media placement.
By focusing on digitally targeting member customers or prospects like them across platforms, advertisers can leapfrog competitor engagement with these customers and save dramatically doing it. Incorporating member service marketing into measurement is therefore a necessity that will provide campaign and optimization insights that future-proof businesses ahead of any targeting or attribution changes.
