Does it add up? Data solves the puzzle

Nick Manning, one of the smartest media commentators, recently wrote in the Media Leader

The key to developing this is real consumer insight; not targeting ABC1 adults aged 55 plus, but genuinely understanding consumer behaviour, how to reach core consumers and what motivates them.

The core of addressable media is being able to reach specific, identified consumer groups. An example is Sky’s Adsmart, which we use extensively.

Adsmart is technology that distributes specific ads to individual Sky and Virgin Media home set-top boxes, so advertisers can communicate effectively on a one-to-one basis to identified households. This is around 30 to 40 per cent of UK homes (depending on audience and location.) The key to using the system effectively is data targeting.

Sky Adsmart now has over 900 individual target segments to use as target audiences: everything from location by postcode to shopping behaviour to purchase behaviour to technology use to lifestyle. These are made up using a combination of Sky’s own household data with household-level data from a number of leading data providers, including shopper data from many major retailers.

Advertisers can also upload their own data at postcode level to the platform; they can (according to Sky…)

• Target groups of existing customers with up-sell or renewal messages.
• Profile existing customers to understand their characteristics.
• Exclude existing customers to target potential new customers.

What is important is that clients can use their own data to target specific groups of prospects, achieved by profiling customer records and augmenting with other data sources.

This allows us to develop a SINGLE ADDRESSABLE AUDIENCE. It’s essential to have one agreed quantitatively based and calibrated audience that is used for all targeting. Most media owners use different data sources and methodologies, often creating look-alike audiences which can vary quite considerably.

To be able to run effective addressable activity across multiple channels, one audience nomenclature is essential.

The reality is that most brands have quite limited cohorts of users, in addition most brands generate the vast majority of their revenue and profit from around 20 per cent of their customer base, proving Vilfredo Pareto’s study of wealth distribution in Italy in the 19^th century largely correct.

Most marketing theory talks about generating mass awareness, we are entering a world where this may be impossible and need to rethink what we can achieve. Targeting and convincing the 20 per cent of customers who contribute 80 per cent of sales maybe a far better option in a fragmented media landscape. The issue is finding them.

AUDIENCE INTELLIGENCE

All of these are achievable via a data led, consumer centric addressable strategy, which we call AUDIENCE INTELLIGENCE.

Why? Because understanding consumer behaviour unlocks insight into which specific media channels they consume, also what motivates them and how they behave, therefore where advertisers should invest.

We have already established no one medium has universal effect, multiple channels are required to maximise response.

A huge benefit is that addressable advertising can be targeted using a clients’ own customer data, rather than translating data into a broad proxy defined by age or ‘social class.’ If a client has a 1 million data customer records, we can analyse and group these by location, behavioural similarity and average value. We can understand exactly what media they use, when and what combinations will influence their purchasing behaviour.

Our approach is to analyse client’s customer data, using analysing their postcode data and previous transaction data via a census-based segmentation tool, we are one of few UK agencies to subscribe to CACI’s ACORN database.

This divides the UK population into one of 65 types based on their type of housing, occupation, financial position and a lot more. We attribute every data record to one of these groups, using their postcode as an identifier. We can look at value of each group based on total value, frequency of interaction, lapsed users and emerging customers. It means we’re dividing the UK into groups of 350,000 households that we can then specifically target via addressable channels. We create granular targeting models of live customers, which link back to key business KPIs. We can go on to establish cost per acquisition and retention to fulfil commercial imperatives.

We add further ‘media’ and behavioural insight using YouGov Profiles data, effectively taking the guess work out of targeting. YouGov Profiles has a data set based on streaming behaviour, so we can get insight on how to target streamers and ‘free to air’ avoiders.



We can create very accurate targeting and acquisition models. Alternatively, it’s possible to create addressable targets based on existing consumer models and turn this into addressable audiences. So, if a client has a preferred consumer profile, developed through qualitative research or social listening, this can be turned into an audience that can be addressably targeted. We’re taking the guesswork out of targeting and create one model that works across all disciplines.