What Are You Selling? Shifting from monetizing your data to monetizing your audience

This year marks a major turning point in the world of advertising. In 2019, for the first time, spending on digital advertising will surpass spending on traditional advertising in the U.S. Spend on traditional advertising is set to drop from 51% to 46% of total U.S. spend.

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In response to this trend, more and more retailers have been positioning themselves as an option for advertisers looking to go digital. Recent years have seen a string of announcements about retailers establishing digital media divisions – Walmart, Target, Kroger, Loblaw, Carrefour, and many others.

These retailers are banking that advertisers will be willing to pay for targeted advertising that is not based just on what a customer has searched for or shared with their friends, but on what they have actually purchased in the past. This shift towards personalized marketing using customer data that is closer to the actual point of purchase is what allowing Amazon to steal share from Google and Facebook. And more traditional bricks and mortar retailers believe they can get in on the action.

But there is a piece that is often missing from the conversation. Customer data alone is not enough. What Google, Amazon and Facebook all have – addition to a goldmine of data – is a platform that people return to again and again. These platforms are built on trust and consistently deliver high engagement.

But retailers looking to monetize their media channels need to understand what they are really selling. A rich data set with shopper purchase history is a good start. But a highly engaged audience is the real driver of value for advertisers. Keep reading for four tips on how to use every interaction with your customers to build an audience advertisers will love.

1. Make it Easy

Shoppers are flooded with marketing messages all day every day. Their inboxes and social feeds offer a steady stream of well-crafted calls-to-action. People are willing to engage with brands they care about – especially if there is something in it for them. But recognized that any process that isn’t quick and easy will send your abandon rate through the roof.

People will register online for a rewards program – but not if the registration page includes a survey collecting every piece of demographic data your marketing department could come up with in their brainstorming session. People will gladly use a coupon – but not if it requires them to replace the toner on the printer they haven’t touched in eight months. People will download your app – but if the first version is so buggy that they can’t get past the login page, don’t expect them to be coming back each week to check for new personalized offers.

2. Make it Valuable

Most consumers today understand that the brands they deal with are looking for their data. But that doesn’t mean they are willing to give it up for free. If you want to learn something more about your customers, offer them something in return. It might be bonus points in a loyalty program for providing more data about their household. Or exclusive perks in exchange for downloading your new app. Make sure there is something in it for them and your customers will be much more likely to come away feeling positive about the interaction.

3. Make it Active

I said above that you want to make things as easy as possible. But there is another principle here that, at first glance, can almost seem contradictory. If you want to build an engaged audience, you need them to actually engage. In other words, you want them to actually do something – however small – to get the value you are offering. I still meet too many retailers who invest a lot of money and effort in delivering personalized offers to customers. Then they give discounts to those customers whether they are even aware they are getting them or not.

Of course engagement is not just about discounts. Aim to create content that makes life better for your customers. Personalized recipe recommendations, health alerts, and online communities like a group for new moms are all great ways to increase engagement.

There are many different channels that can be used to drive customer engagement: Website, app, email, SMS, or Facebook and other social media channels. But whatever channels you use, asking your customers to do something – like a post, open an email, click a button to load their offers to their card – is the only way to know for sure that they are paying attention to your content. And having proof that customers are listening and willing to act is a big plus when you approach potential advertisers.

4. Make it Transparent

Most people are happy to share their data in exchange for value. What most people are not happy about is being tricked. If you are using people’s data for advertising purposes, make sure they know about it. This means more than just burying it in paragraph 17 of your terms and conditions. It means telling them in clear, simple language and giving them the opportunity to opt out. Playing games and obscuring the truth from people may get you a few more registered users in the short run. But in the long run, it will catch up with you.

Follow these principles, and you will be well on your way to building an audience that advertisers will love. More than that, they will help you grow your business with your most loyal customers. Because the principles above are not just for retailers looking to get into the digital ad game. They are also principles that just make good business sense.

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