Most of us went to sleep on November 8, 2022, expecting to wake up to a new political landscape. Some were dreading the morning and some couldn’t wait, but as the sun rose, I would argue that all of us were surprised.
But really? Consider our behavioral changes in recent years; we have jettisoned our landlines, block calls from unknown sources and ignore unwanted texts. So many of our habits have changed in fundamental ways and it is increasingly obvious that the polling methodologies on which all political predictions are made are archaic. Still, the pundits and journalists who feed or dash our hopes, reflexively analyze the limited findings, treating them as gospel.
Emails, surveys, and contests are common zero-party data collection methods. If a retailer hopes to gain deeper engagement, unmediated by another party and voluntarily shared by its customers, high-quality content will be the key.
New World Order
So, as journalists look to polls, retail looks to social media advertising data for customer insights; like polling, social media is in crisis. In recent days Meta has laid off 13 percent of its workforce, Twitter is flirting with bankruptcy, and while TikTok continued to gain in mindshare and time spent, it has slashed its global revenue targets by $2 billion. The causes for social media’s woes are myriad, but the outcome that has most impacted retail marketing is Apple’s privacy protocol ATT (App Tracking Transparency) which has dammed up the consumer data stream. While this is old news, many in retail reflexively depend on social media for insights, but as the phantom red wave demonstrated for pollsters in the mid-term elections, it is high time to develop and deploy new tools.
Know Your Customer
If data is the holy grail of retail insights, our new tools must be designed to wean us off purchased third-party data, and instead support zero- and first-party customer data capture capabilities. First-party data accumulates in the background as retail activity unfolds on a proprietary site. This is a major advantage for retailers where the customer journey progresses from search to conversion; think: Amazon, Target, Walmart, Lululemon, etc. Zero-party data is one step closer to the consumer, it is data freely shared by a customer through loyalty programs, contests, promotions, surveys, and other incentives that require engagement.
Retailers experimenting with first-party data innovation include Macy’s, Walmart, Nordstrom, and Target, all of which have developed retail media networks. This strategy exploits the power of the aggregator that has long fueled Amazon, Google, Facebook (Meta), and other digital data consolidators. Retail media is promoted as both a source of income, as retailers rent digital real estate within their existing online retail footprint, and as an owned data source. Bain & Company forecasts that retail media will be a $61 billion business by 2025.
Owning the Search
Google has a new initiative that commercializes the black box which is the company’s search optimization, marketing it as a service to retail and brand customers. Google’s Shopping-Search tool can be embedded in a retail or brand-owned desktop site and mobile apps. BOF quoted Carrie Tharp, Google Cloud Vice President of Retail and Consumer as she detailed the initiative, “It sounds like a simple problem to solve, but it’s been extremely difficult for retailers’ ecommerce sites to understand a shopper’s intent and natural language in a search query, then map that to imperfect catalog data, and deliver the most relevant results.” Tharp continued, “With this tool, shoppers should get strong results even with long, complicated searches, like a long black dress with short sleeves and comfortable fit, without having to refine or shorten their search.” Not only does the Shopping-Search improve the customer experience, it also offers the host brand or retailer rich, first-party data.
The Zero Challenge
The hurdle to accessing zero-party data is higher. Ad-tech platforms are developing formats to capture and organize this data, but the aim of truly understanding customers requires creativity. Tim Glomb, VP of Global Content, CM Group, a leading Martech (marketing technology) company was recently interviewed by Forbes. In the interview, Glomb first acknowledged the rules of shared consumer data, “I’ll build a contract with everyone that allows them to take their data back and tell me not to use it,” then continued, “But if John tells me he’s a homeowner, and he needs to do a roof project, I’ll use that to monetize with Home Depot or Lowe’s and get the offers that he wants. It’s like taking a helicopter ride over the street. You don’t even have to navigate through it. That is the power of zero-party data.”
Emails, surveys, and contests are common zero-party data collection methods. If a retailer hopes to gain deeper engagement, unmediated by another party and voluntarily shared by its customers, high-quality content will be the key. Creative marketing innovation offers retailers an opportunity to differentiate and incentivize engagement. Customized affinity activities targeted to different consumer cohorts, brand-based newsletters appealing to different target audiences, games, events, or other activities can all be elements included in an innovative zero-data marketing stack.
Mixing It Up
Where things get interesting is in the mix. First-party retail data, (SMS chats, purchase patterns, email click-throughs, browsing behaviors), combined with shared zero-party data offer retailers an opportunity to get things right. The decline of targeted social data, while a challenge for retail, could restore a merchant’s muscle memory, triggering a renewed emphasis on really knowing the customer, not just an amalgam of data that reprsents them. Retail can get this right. It is time to retool.
