As 2020 draws to a close, there are lessons to be learned for marketers faced with abrupt changing consumer behaviors and an acceleration of digital channels. Three lessons learned immediately spring to mind as I reflect on a rather momentous year that has upended many industries, and has perhaps permanently changed how marketers engage and communicate with customers.
Adapt to Changing Customer Behaviors
First, I believe that the dramatic change in consumer behaviors finally pulls the plug on marketers being able to take for granted static, linear customer journeys. If we apply the 80/20 dynamic, where 80 percent of operational marketing is plowing ahead with traditional marketing approaches and 20 percent reserved for ambitious innovation, this year has taught us that the ratio must be flipped.
One reason it must be flipped is in response to the dramatic shift toward an online, digital-first experience. According to the U.S. Department of Commerce, over a two-month period this spring there was an 11 percent increase in ecommerce spending as a percentage of all retail sales, greater than the increase over the previous 10 years combined. The in-store experience that drove many a marketing campaign is, if not disappearing, certainly waning in importance. The National Retail Federation reports that on Black Friday, 44 percent more consumers shopped only online compared with last year.
In addition to a surge in ecommerce, customer expectations for unique, personalized experiences are also intensifying. According to McKinsey, 73 percent of U.S. shoppers said that they’ve tried a new shopping behavior this year such as curbside pickup or online grocery delivery, with 80 percent claiming that they will continue the new behavior.
Even as customers experiment with new behaviors and a digital-first mindset, they still put the onus on brands to recognize them across channels – just as they did when linear customer journeys consisted of far fewer channel options. In a Redpoint survey conducted with Dynata, 70 percent of consumers said that they will shop this holiday season with brands that personally understand them.
The totality of these trends points to the absolute necessity for brands to compete on customer experience. The straight-line customer journey of consideration/evaluation/purchase is likely gone for good. Customers can appear anywhere, at any time. Providing a seamless omnichannel experience results in satisfied, loyal customers and ultimately drives revenue. Adapting to changing behaviors by creating unique, personalized experiences should be one of the more important lessons learned for ambitious marketers as we head into the new year.
Be Persistently Curious
With a clear recognition that customer behaviors are changing and the status quo for engaging with customers must likewise evolve, the next lesson learned for marketers is more tactical in nature. How to achieve new goals for creating innovative experiences?
I’m reminded of a quote attributed to Louis Pasteur, “Chance favors the prepared mind, and opportunity favors the bold.” An important lesson to be learned from the upheaval of the past year is that now is the time to be curious. Rapidly changing customer behaviors create opportunity for the sheer fact that there is so much more data to observe.
An important lesson to be learned from the upheaval of the past year is that now is the time to be curious.
Consider, for example, 1-800-CONTACTS. Two years ago, the online contact lens retailer set out to enhance a personalized customer experience. With a crush of new customers this year, many of whom were new to wearing contacts, the company suddenly discovered that it had completely new segments. Because it had a platform in place to engage with individual customers at any given moment, the company was prepared to meet the unique needs of new customers.
Yes, customer behaviors are changing and perhaps even unrecognizable, but every transaction, every behavior and every preference leave behind a data trail that ambitious marketers are able to mine for clues about how to optimize a unique customer journey.
Now is the time to be curious about what makes an individual customer tick. A single customer view takes out the guesswork; with customer data from all sources integrated into a single platform and updated in real-time, marketers have what they need to create and experiment with various experiences, to optimize individual customer journeys and to ultimately deliver individual next-best actions for any customer, on any channel.
Goodbye, Third-Party Cookies
The phasing out of the third-party cookie takes us to the third lesson learned. In the same vein as the need to adapt to changing consumer behaviors and the need to explore new opportunities in customer data, the demise of the third-party cookie is a wake-up call for marketers that now is not the time to stand pat.
While Safari and Firefox already block third-party cookies, the decision by Google to end support for third-party cookies on Chrome in January, 2022 is significant because of the browser’s global market share of about 70 percent of web traffic.
The lesson to be learned is that orchestrating a dynamic customer journey, especially across the web, will depend on severing a reliance on third-party cookies for tracking customers. Instead, organizations must find new ways to gather, share and safeguard customer data for the purpose of creating personalized experiences.
Again, this presents opportunity. Already, we’ve seen several brands, most recently Walgreens, try to capitalize on the upcoming void by creating their own media networks. Walgreens Advertising Group, and other platforms like it (CVS, Home Depot, Target), offer advertising space on their own channels and partner channels – providing omnichannel marketers with even more digital channels to address ‘known’ consumers and a new competitive landscape.
We’ve covered the loss of third-party cookies in this space before, especially as it pertains to the need for brands to have customers share more data and the attendant privacy concerns. Building customer trust through transparency about how data is collected, shared and used helps reduce the reliance on third-party cookies, because customers will then be more willing to share personal data. When customers realize that self-identifying and/or sharing data results in a personalized experience, they’ll continue to engage in this value exchange, further reducing the need for brands to rely on third-party cookies.
By using emerging technology such as the LiveRamp Identity Link, brands will still be able to reach cohorts of users with relevant messages – even with the user’s identity masked. But even with this new technology, the coming explosion of new digital channels reinforces the need to know everything there is to know about a customer – likes, dislikes, preferences, behaviors, etc. – to know how to effectively spend advertising dollars.
The need to adapt to changing consumer behaviors, the need to mine customer data for new opportunities and the need to replace third-party cookies to create personalized customer experiences all speak to the need to re-think how to orchestrate a customer journey. The main marketing takeaway from 2020 is that traditional methods of engaging with a customer are no match for the tremendous amount of change that has occurred. To meet customers with relevant omnichannel experiences, marketers need to take these lessons to heart; by recognizing the changing situation and approaching it with curiosity, marketers will have a great head start in 2021 for creating experiences that matter.