Monetising owned media in the era of opt-in.
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Are you making the most of your owned media? And if not, what to do about it.
Since GDPR came into force almost two years ago marketing relevance has increased with consumers now enjoying better targeted communications. A number of recent research reports outline how consumer perception towards direct marketing has improved such as Wilmington Millennium’s GDPR Impact Study which revealed that 48 per cent of people consider all of the direct comms they receive from brands to be relevant – in comparison to the 88 per cent of people that now find TV advertising irrelevant.
Increasing your reach in the opt-in era
The catalyst for improved relevance has been opt-in. Permission-based marketing has meant that organisations can only reach consumers that have expressly stated an interest in being targeted. This has led to more engaged customers and click through rates, ROI etc. have all significantly improved. Which is all good news. But what about the large proportion of customers that brands can’t reach? Many organisations have lost around two thirds of their databases. It is not surprising therefore that there has been interest in finding new ways to engage un-opted in customers. And owned media is proving to be an incredibly effective means to do just this. However, its success also depends on relevance. The key is taking a pragmatic approach and resisting the temptation to scattergun communications to everyone.
The two owned media approaches
There are two major ways that organisations can monetise their platforms. The first is helping consumers discover a brand by being placed top of search. Advertisers can pay for their brands to appear at the top of the platform search listings. For instance estate agents paying RightMove, restaurant brands paying Just Eat, sellers paying Amazon, homeowners paying Airbnb for the premium slots. In the food delivery industry some restaurants are now investing more on search than they pay in ground rent. This is because the position of a listing is directly related to the number of orders received. In essence this is the digital equivalent of buying the best shelf placements in-store. Additionally brands can pay for recommendations to be pushed to customers… ‘you purchased/browsed this on your last visit we think you might like this…’.
The second form of monetisation is in-platform advertising (or in old money-old ad-space) through the form of offers, sponsorship or carousel ads. This is particularly compelling since it offers third party brands access to customers that under GDPR can’t be targeted by them directly. In fact in the new draft Code of Direct Marketing published recently by the ICO ‘recommend a friend’ promotions have been deemed to contravene GDPR because the advertiser is still instigating and incentivising the contact with the third party without consent despite not contacting them directly. This approach takes the same form as traditional affiliate marketing bringing together three parties the publisher or media owner in this case organisations with a platform/app, the advertiser and the consumer. To work all there must feel the benefit. The media owner in terms of increased revenue (but not to the detriment of the relationship with their customers), access to, in some cases, millions of new customers for the advertiser and valuable offers for the consumer. This triumvirate is the crux of success. If one party is dissatisfied the system breaks. For instance if consumers feel bombarded then the channel is irrevocably damaged. If media owner feels that the advertisers offers are not relevant then conflict emerges.
How to manage owned media
To ensure equity across the three parties a number of elements are critical:
Customer groups must be segmented so that the audience is valuable for the brand. For instance in food delivery Coke can reach customers that haven’t ordered a Coke product before rather than providing offers to customers that already buy their drink.
There must be brand synergy and inherent awareness. Sending a customer a communication about a new shampoo brand on RightMove for instance just doesn’t make sense. However, sending information about home moving companies or deals on furniture, utilities etc does.
Simplicity is key. The value offered to customers must be easily communicated. E.g. Coke is offering you 20 per cent off at your favourite restaurant today.
Communications should be tied into relevant points of time and moments of culture to enhance relevance and motivate the customer. For instance serving a communication for Bonfire Night, Valentine’s Day, Black Friday etc. The customer journey will also be taken into consideration so if they only order from Italian restaurants they can be served up an offer from an Italian restaurant they haven’t ordered from before.
Finally the customer must be at the heart of the communication. This is the hard part as balance must be achieved between what is sold and what can genuinely be delivered without damaging the channel. For example sending too many communications or sending a Pepsi offer one week and a Coke offer the next. Also consideration must be given to conditioning customers to buy only on deal, which is what has happened to many restaurant chains that have over-couponed and now customers only dine on-deal.
If you follow these guidelines it is possible to ensure that the channel is leveraged effectively and that the ecosystem remains in balance.
Owned media is an exciting channel for all involved, but ultimately what is clear is that it must be tightly controlled otherwise it could go the way of programmatic, the future of which lies in the balance as a result of close scrutiny by ICO.
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