How direct marketing applies to digital

One of the biggest issues we are hearing from clients today is how to translate their experience and expertise in direct marketing, both print and email, into the ability to deliver personalized and relevant customer experiences across multiple digital channels.

Many corporate marketers, especially in the insurance, financial services, and subscription services like wireless and cable, have tremendous expertise in direct marketing. Over the years, they have built sophisticated segmentation models, targeting capabilities, and optimization processes. However, they have trouble leveraging this intelligence in the real-time, contextual world of digital marketing.

How direct marketing applies to digital

Marketers should be investigating how to build data models, campaign workflow, and analytics that will support not only current direct mail-focused marketing programs but enable them to take advantage of the greater sophistication of digital marketing endeavors. The fundamental difference is moving from a static, batch-based approach to segmentation and publishing to a dynamic, interactive approach that can be used both in outbound digital marketing efforts (i.e., email, banner ads, search, and social media), as well as inbound web experiences.

With direct marketing, as a marketer you define your audiences and then build target segments, creating actual lists of people who match the criteria, derived from your own customer database or CRM system, with data appended from third-party vendors. In some cases, you may actually rent or buy lists from list brokers as well. Once the lists have been matched to the appropriate content, the campaign is published or mailed, and you simply wait until you get responses back. Then you manually conduct analysis on the response data to optimize the next batch and to calculate the ROI of the campaign.

In the digital world, a marketer starts out the same way: Define the segments, create personas, and use all your existing data to inform the appropriate content creation. At this point, however, the first and perhaps biggest difference arises. Instead of being able to go out and build a list of prospects or customers, the marketer must define the attributes associated with the profiles and then determine how to collect that implicit data online, even though the site visitors are anonymous. (There is of course a slightly different path at this point for known or authenticated visitors.)

It is the definition of the actionable attributes that is critical -- mapping them to digital data sources and creating data models that allow you to assign a visitor to the appropriate profile. Such assignments are based on the implicit information obtained through incoming data such as IP address, geo-location, referring site, or search terms. It is this data model that looks quite different from the offline customer database.

The second difference in comparing direct marketing with digital is that in the latter there is the data model associated with real-time explicit data flow. Once a visitor hits a website, every choice, click, and action he or she takes can be fed back as data associated with that individual. It can be used to evaluate intent and used to determine the next piece of content (or next offer) to be shown. This algorithmic-based data model is quite different from the traditional batch-based model in that it actually self-optimizes, allowing the visitor to see content that is more relevant to him or her, more popular, or selected via a predetermined set of business rules to be served to this individual.

This intelligent self-optimizing approach has the potential to drive experiences across virtually any distribution channel including e-commerce, email, banner advertising, search, social, and the digitalized versions of traditional ad channels like out of home and in-store.

Savvy marketers should be looking to the future when defining data models, customer databases, CRM systems, campaign management, and analytics packages. Map out what that universe should look like for you. Create the data models, map the data flow, determine the data sources, and review the metrics and reporting needs to ensure a successful and measurable outcome.

John Kottcamp is chief strategy and marketing officer of Tahzoo.

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