It's been said that data is a form of currency in marketing. In this podcast, you'll learn how marketers and technology professionals can begin to not only shift...
In the eighth 2 Guys and Some Data podcast, Allen and Larry discuss the evolution of retargeting and how it's not only a digital tactic for marketers today — it's being used in direct mail, TV, and more.
Allen: Hey to all the data-driven marketers out there looking for new ways to reach unique prospects and better engage audiences. This is the eighth podcast for the 2 Guys and Some Data series giving you the nitty-gritty advice you need to actually make more money. I'm Allen Abbott.
Larry: And I'm Larry Kavanagh.
Allen: And today we're gonna talk about retargeting and some cool new ways where targeting is breaking free of its digital confines. So let's get right to it. Retargeting with digital display ads really became a hot topic for marketers somewhere around 2010, which isn't that long ago if you think about it. We were already using Uber for transportation.
Larry: Allen, Uber actually launched in 2011.
Allen: Oh. Well, we were definitely all using Instagram to share photographs.
Larry: You're getting closer. I mean, Instagram did have a million users by the end of 2010. Man, you were ahead of your time if you were one of those.
Allen: Maybe not. Maybe 2010 was a long time ago. Well, way back then, Moz author, Joanna Lord, defined digital display retargeting as "A form of marketing in which you target users who have previously visited your website with banner ads on display networks across the web.” A visitor would come to your website, you drop a cookie on their device, and when they leave you can send them targeted banner ads based on products they viewed in the hopes they would click the ad and go back to your site.
Larry: Of course, retargeting website visitors with email has been around for a lot longer, but digital display ads at the turn of the decade were the first time that anonymous browsers were retargeted. It took off fast. In just seven years it's already become a 13 billion dollar per year industry.
Allen: Yeah, a huge industry and growing at an annual rate of 20%. As we've discussed before though, digital display retargeting has an Achilles heel. Consumers can grow tired of being bombarded with advertising, and it's rather frustrating when ads slow or completely stop a web page from loading. So marketers have had to develop new ways to reach audiences.
Larry: Marketers never stop innovating, which is why there's not really a magical marketing recipe that carries over from decade to decade. What works today might not work three years from now, but it's this constant change and evolution of marketing that makes it interesting.
Allen: Larry, if it wasn't interesting, I don't think I could have done this for the past 30 years.
Larry: Me neither, though not quite 30 yet, but today we're at a point where marketers are beginning to innovate when it comes to retargeting anonymous browsers.
Allen: Yeah, you can retarget website visitors with direct mail instead of banner ads. Our own data has shown that retargeting with postcards delivers a nine times return on advertising investment, and our retargeting can reach both known website visitors and anonymous browsers — which can make up a very large percentage of site visitors. I believe retargeting with direct mail is a natural extension of where marketing is heading.
Larry: What do you mean?
Allen: Well, retargeting with direct mail combines the personalization and individualization capabilities of digital retargeting with the very high response rates of direct mail, a very productive match.
Larry: You're right on. The amount of personalization that can go in direct mail today is astonishing. I heard the other day that Kroger, a very large and successful grocery store chain is now printing customized 16-page flyiers where the product and the direct mail piece sent to my address can be entirely different than what my neighbor gets. This hyper-personalization is based on what Kroger knows about my past purchase history and, frankly, that flyer is way more impactful than a digital display ad.
Allen: That's amazing, but direct mail isn't the only area retargeting is breaking out of the online digital-only mindset. It just happens to be my favorite.
Larry: It's a personal favorite of mine as well. But there's a lot of cool new ways for marketers to send retargeted messages to audience and individual consumers now. Retargeting itself is about to evolve.
Allen: So what's possible now? And what do you think we can expect to see in the next five years?
Larry: Well, right now it's possible to retarget audiences based on the TV show they watched. Smart TV has really changed how viewers watch TV, and marketers can reach those viewers. For instance, Samba TV, which is a content recommendation engine embedded inside Smart TV apps, has partnered with MediaMath. This will allow for programmatic segmentation and retargeting of TV audiences. Adobe is partnering with Sling TV to bring real time advertising to live streaming TV and, if history is a guide, retargeting will follow closely on its heels just like it did with real time advertising online. Heck, it's also possible to retarget people based on where they have been. You can create an audience of people who attended a concert, hiked the Grand Canyon, or eat at fancy restaurants.
Allen: Wow. Eventually, all I might see or ask for music streaming and bourbon.
Larry: That could be. There have been real strides in identifying users across devices, and in five years some of the limitations we have now won't exist.
Allen: And let's not forget that as retargeting moves away from online only, marketers will need to play their retargeting campaigns differently, and they're going to need more than impressions and cliques to build and measure a successful campaign. And speaking of data, in our last podcast you asked me how much data could fit on a gram of DNA instead of The Terminator question I would have rather answered. I've scoured the internet and come up with a really tough question for you.
Larry: All right, Allen. Give it to me.
Allen: Okay, scientists from ETH Zurich, and the universities of Lyon and Rennes in France, Collège de France in Paris, Paul Scherrer Institute in Switzerland, and the Berkeley National Laboratory in California have proposed that it's possible to store really large amounts of data on nano magnets.
Larry: Oooh, nano magnets. I like it.
Allen: You shouldn’t. To create this nanomagnet, magnetizable atoms must be attached to a silica surface. So here's the question for you, at what temperature does the process of creating these nanomagnets work?
Larry: Um, can I have The Terminator question?
Allen: Well, I can give you a hint. The T1000 would probably be affected by the temperature, but he'd probably recover.
Larry: All right. So to answer this question, all I need is an understanding of fictional killer robots? No problem.
Allen: Okay, so while Larry tries to figure this out, let's talk about how retargeting campaigns are going to be built by using more and different metrics than the ones used in traditional banner and retargeting.
Larry: You're right. Some metrics like conversion rate are always going to be important in developing a retargeting campaign, but it's going to be just as important to look at page views and time spent on page while factoring in bounce rate. We'll also want to see how consumers behave on a site by device. They may spend less time on a page if viewing on their phone than they would on desktop, but that doesn't mean they're less interested. There could be a host of other factors that cause them to scroll or view a page quickly. One is simply people use their phones on the go. They may not be focusing on a particular site as they browse, because they're also walking through a store, comparing prices, reading reviews.
Allen: That's a great point. Since I travel so much I sometimes see ads that pique my interest as I am going through airport security or checking into my hotel. I make a mental note of those and post sites up on my laptop once I am settled. If a person is in store reading reviews on your site, a retargeted email or eventually an SMS or push notification could be extremely valuable to them.
Larry: I'm glad you mentioned email, because growth in your email file is another important metric for anonymous retargeting. A visitor may not be ready to buy today, but you may be able to get them to provide an email address. What this will do is transform this previously unknown shopper into a much more engaged and more easy to contact audience.
Allen: That's great, Larry, and it works really well until they unsubscribe. Well, once they do they may be quite responsive to a retargeting postcard, or you may find it better to reach them when they're watching their favorite primetime show that appeals to a large portion of one of your audience segments.
Larry: Well, you're getting into two important retargeting questions. Who do you retarget and what is the right medium to use? Unique or first-time visitors may be a great candidate for top-of-the-funnel retargeting practices like banner ads, but returning visitor is demonstrating more interest and engagement. A more aggressive form of advertising like direct mail can make sense, because these shoppers are more ready to buy. Previous visitors who have unsubscribed, like you said, is another great example of that.
Allen: Yeah, and hopefully marketers will have moved completely away from the one size fits all to a completely individualized marketing approach. So, Larry, a little while ago I gave you a hint about this episode's trivia question. The T1000, the liquid metal terminator from the second movie, would definitely have a bit of trouble if exposed to this temperature, but he'd recover. So did you figure it out?
Larry: Well, my guess is really really cold. Magnets becomes superconductors as you get near absolute zero. At least, that's what I remember from reading way too much sci-fi.
Allen: What a nerd. How could you possibly know that? The process of creating the nanomagnets only worked at around minus 270 degrees Celsius, which is, indeed, close to absolute zero. Much colder than that, the liquid nitrogen used to freeze the T1000, but as everyone knows, only extreme heat can destroy the nanotechnology cells.
Larry: Clearly. That was also true for Sauron's ring in Tolkien, but that's a whole nother kind of geek.
Allen: As you might guess, those temperatures aren't good for computers. Both DNA and nano magnets could be options in the future, but until the process becomes more stable and affordable, we're going to have to stick with what we have. We have a question. A listener asked when we think the fictional advertising world experienced by John Anderton in Minority Report will become a reality.
Larry: Well, let me give you some quick background here. Tom Cruise's character, John Anderton, is running away from some bad guys. He's in a downtown area, and he's trying to get away, but as he's running through this downtown area, these billboards using facial recognition or retina recognition or something, keep on calling out his name. You know, "Hey, John Anderton, how about some new cologne." Or, "Hey, John Anderton, I think you need a new car." Well, you know, that's not great when you're trying to escape from some bad guys. Now, the thing has a kind of funny ending. He ducks into this retail store, and this retail store has a greeter billboard, but the greeter billboard displays, perhaps, a little bit of the underlying problem with all marketing technology and big data because it greets him, "Hey, Mr. Yokomoto, I hope you're having a good day."
But, anyway, a great question. My guess is that really, or what I think is really that what we're gonna see is marketing being a little quieter than that. The kind of things like postcards to people who have browsed websites or direct mail to people who browse websites or the example I gave with Kroger, I'm not gonna really know that I've got a different flyer than my neighbor has. I think the way you'll see this technology evolve is much quieter than the very entertaining view we had in Minority Report. That was a great question. If anyone has any additional questions, please come to our website and you can submit them on the website and love to hear from you.
All right. That's all we've got for this episode. I want to thank everyone for listening to two guys ramble about retargeting and metrics. If you liked this topic, you'll probably find our blog, Taking Retargeting Offline with Programmatic Postcards, interesting. You can find it and more resources at navistone.com/blog. Again, that's navistone.com/blog. We'll be back in a few weeks to talk about how to measure the effectiveness of your marketing mix. I'm Larry Kavanagh.
Allen: And I'm Allen Abbott, and thank for joining us.