How brands can get started using private exchanges
Customer data. It’s an incredibly valuable asset for any marketer who possesses it. But without access to the right technology platforms, digital publisher relationships, and execution strategies, this proprietary data can remain trapped within a brand’s CRM system, rendering the brand unable to speak to their own customers with the information they worked so hard to amass and protect. Let’s consider one of the most data-rich brands around to illustrate the limitations such a marketer might face.
American Express has a lot of data about me. Because of the nature of their business, they know my spending habits, demographic information, and other key information that they can use to present me with customized offers. But even given what Amex knows, actually using that data to achieve their business objectives isn’t as simple as you might think.
Let’s imagine that I have a green card, and Amex has determined based on my profile and habits that I’m a good candidate to upgrade to a gold card. The solution seems simple: they can present the upgrade offer to me every time I visit americanexpress.com.
But not so fast. I only really log into their web portal once a month to review my bill when it arrives. Given that the optimal ad frequency to influence conversions can be well north of once per month, that’s really not enough opportunities to persuade most people to upgrade.
Now think about poor Allstate Insurance. I only log into their website twice a year! Both companies have my email address, so they can supplement their website ads with email offers. But that can only scale so far before I determine that it’s annoying spam, and disallow them from emailing me further.
With this key limitation, what’s a marketer to do? One way for them to get the most out of their customer data is to use private marketplaces to effectively intercept their customers outside of their website. Here’s how a marketer can make this happen.
Get a data management platform, or DMP
This can either be through a direct relationship with a DMP vendor, or through an indirect DMP relationship via your agency. The data management platform is where the marketer – Amex or Allstate in our scenario – stores all their CRM data for planning and performance execution analysis. Having your data loaded into a DMP makes it actionable when you make buying decisions.
Determine where your customers are
The next step is to use the DMP to pixel match your customers with one of the private marketplace platform stacks. In other words, you’ll match up your user database with that of the private marketplace. From that pixel matching, the private marketplace vendor can now provide you with overlap indexes on their publishers’ private marketplace properties and packages. You’ve now established your hunting ground.
Choose your publishers
Look for packages with high audience index overlap, then negotiate private marketplace deals with those publishers to gain high-priority access to your target audience. Ultimately, this creates many more additional opportunities to present your offer to your customers than if you could only serve them ads on your website.
When looking for overlap, a marketer should pay attention to two factors:
1.The raw count of pixel matches. You want to make sure the publisher can net you sufficient scale.
2.High match indexes. Match indexing works much like a comScore index: it shows the skew of your audience on the publisher’s site above a baseline (typically the Internet as a whole). A higher skew means a higher probability of being able to reach your audience.
Consider these pro tips
Here are two private marketplace execution strategies you should consider.
1. Buy an access deal with the publisher. You’ll only buy those impressions that match your target audience, and always serve the offer. In our example, American Express would only serve the gold card offer on the publisher with whom they’ve made a private deal – say The Wall Street Journal – when an Amex customer who is eligible for a gold card upgrade shows up on that site.
2.Consider buying all the impressions you see from the publisher. Pricing negotiation can be more favorable if you make this type of guaranteed buy. For those impressions that match your target audience, you’ll serve the relevant offer. For those that do not, you can instead serve a new customer acquisition ad. Amex might serve a “Try the American Express card” offer to those users.
Alternatively, a marketer can try both of these strategies, then double down on the one that achieves the optimal performance and scale.
Tags: Buyer, Customer Data, Data Management, PMP, Private Exchange, Private Marketplace