Beyond personalisation: European perspectives on contextual marketing Beyond personalisation: A Dutch perspective on contextual marketing Dutch CMOs are beginning to use contextual data but find it challenging to identify relevant contexts and produce messages effectively in particular contexts—and thereby to fully embrace contextual marketing As the ability to capture information about customers and prospects increases, marketers are learning to deal with the subtleties of the data they collect and use them to communicate their brand message effectively Contextual marketing—the use of data such as a customer’s or prospect’s location, the activity they are currently involved in or their buying intentions—presents marketers with an opportunity to take their marketing to the next level Marketers in the Netherlands understand the power that data give them to deliver customised experiences across marketing channels Yet many still struggle to define contextual marketing and move beyond personalisation to find ways to provide even deeper value to customers “We don’t use the term contextual marketing,” says Alex Bloemendal, manager e-commerce at online retailer Wehkamp.nl “What we is brand marketing and performance-based marketing, using data sets to be as relevant in context as we can for our customers If contextual marketing means individual data from the customer for personalisation, then it is core It is one of the foundations any retailer should work on for the customer, now and in the future.” Sponsored by: A survey of marketing executives conducted by the Economist Intelligence Unit on behalf of SAP examined the state of contextual marketing in five west European markets, including the Netherlands, where the survey identified the top two strategic marketing priorities: improving awareness and perception of the brand and improving customer loyalty About the survey This article draws on a survey of 165 chief marketing officers conducted by The Economist Intelligence Unit in the summer of 2015 In addition to 33 marketing executives from the Netherlands, the survey includes respondents from France, Italy, the UK and the Nordics (Denmark, Norway and Sweden) One-half of respondents represent organisations in the retail sector, with the remainder drawn from a range of industries Of these, just under one-half (47%) represent companies with US$100m-500m in annual revenue, the remainder companies with US$500m and above © The Economist Intelligence Unit Limited 2015 Beyond personalisation: European perspectives on contextual marketing Which of the following are currently your top strategic marketing priorities? Select up to three (% respondents) Netherlands Europe Improving awareness/perception of brand(s) 48 58 Improving customer loyalty 45 37 Understanding customers better 42 40 Increasing customer engagement 42 41 Improving the customer experience 33 28 Ensuring marketing staff has right skills 27 30 Improving ROI of marketikng activities 27 30 Becoming more cost effective 27 30 Other When considering strategic marketing priorities in the European market and the role of contextual marketing, MSD Netherlands (Merck & Co in the US and Canada) is in a unique position As a healthcare company, MSD is not allowed direct access to consumers So any contextual marketing has to be conducted via healthcare providers, who help to communicate the company’s message to patients “In healthcare, contextual marketing can be difficult,” says Joppe Jansen, European franchise director at MSD “The information we collect is about patient populations, not individuals We are not using patient population data a lot right now, but we want to use it in the future We want to map the patient journey from when they first decide to see a physician.” In the Netherlands, marketers harvest relevant data to understand how customers and prospects interact with the company on social media and to identify customer satisfaction Yet marketers know that all data elements are not created equal The information most frequently collected by Dutch marketers consists of location data (91% of respondents) and data about the customer’s current offline behaviour (88%) Most marketers use location data for marketing (55%), although some (36%) collect these data but are not yet able to use them Online behaviour is important too Four out of ten Dutch companies collect data relating to their customers’ online activity Like their counterparts in other west European countries, one-third of Dutch marketers in the survey report that they are not yet using data they collect that reveal a customer’s planned actions © The Economist Intelligence Unit Limited 2015 Beyond personalisation: European perspectives on contextual marketing Although the best marketing channel to use may vary by category or customer, the survey reveals that a brand’s website remains critical to the successful collection of contextual information about customers and prospects Social media is critical for collecting data too, coming fourth on the list after website, email and in-store personnel MSD finds that this is a very useful channel, given that the company is prohibited from collecting information about individuals Social media allows MSD to collect contextual data on a population level, such as tracking the words people use when discussing healthcare issues The company has also created its own channel for collecting information To help improve adherence to a drug regimen, it has created a new way to track one of their injectable drugs to ensure that patients are storing it at the right temperature A chip added to each injector sends real-time data to the customer’s pharmacy Data such as these are invaluable to MSD in understanding patients’ behaviour and will enable the company to market more accurately to patients in the future Which of the following practices at your organisation current incorporates contextual information? (% respondents) Netherlands Europe Communicating with prospective customers 70 66 Issuing special offers 67 56 Identifying prospective customers 67 59 Communicating with existing customers 64 58 Building brand recognition 55 50 Alerting customers to new products/services 55 52 Building customer loyalty 52 51 Other When thinking about marketing practices, Dutch marketers prefer to use contextual marketing to communicate with and identify prospective customers (70% and 67% of respondents, respectively), issue special offers (67%), and communicate with existing customers (64%) Wehkamp.nl, for example, is putting some thought into how contextual marketing can make a difference in communicating offers to customers The company is investigating targeting offers based © The Economist Intelligence Unit Limited 2015 Beyond personalisation: European perspectives on contextual marketing on the device a customer is using “Something we’re looking at is if you are logged on through your app, can we give you other offers or discounts versus if you are logged on via the website.” Although most companies in the Netherlands not currently use contextual marketing to alert customers to new products and services, marketers know that this kind of communication could be improved with the use of contextual information Almost all Dutch companies surveyed believe that their customers are willing to share information with them, depending on the circumstances Marketers believe that almost half would be happy to share some types of data without getting anything in return, such as location data, information about what they are currently doing offline or online, how they are currently feeling, and what they are planning to When it comes to sharing personal interests or friends, however, marketers believe that customers are less willing to part with that information: 39% of respondents believe that customers would be willing to share personal interests, and 42% think that information on friends would primarily be shared only in return for discounts and special offers Despite the advances in collecting and analysing the data, the greatest challenges in contextual marketing in the Netherlands are identifying the relevant contexts to target customers and producing messages that are effective in particular contexts Which of the following, if any, you consider to be the greatest challenges to contextual marketing? Select up to three (% respondents) Netherlands Europe Identifying relevant contexts in which to target customers 52 46 Hiring creative skills required for contextual marketing 48 45 Producing messages effective in particular contexts 48 50 Hiring technical skills required for contextual marketing 45 46 Encouring customers/prospects to share contextual data 42 50 Respecing customer privacy 30 34 Measuring success of contextual marketing campaigns 24 15 Adapting marketing/campaign processes to contextual marketing Other For MSD’s Mr Jansen, the biggest challenge with contextual marketing is connecting the dots “First of all, it’s a challenge to get the right data In Europe, databases are not linked, and it’s hard to have a total view of what is happening © The Economist Intelligence Unit Limited 2015 Beyond personalisation: European perspectives on contextual marketing Dealing as it does with customer information, contextual marketing can present risks Dutch marketers are most concerned about collecting incorrect or misleading contextual information about customers or prospects or damaging the brand by making customers feel uncomfortable “There are some fears,” says Mr Bloemendal of Wehkamp.nl “First, we have enough relevant, valid data available in time to set up these kinds of campaigns? And second is looking at privacy—more people opting out of cookies means that we have less information.” When it comes to contextual marketing, Dutch marketers are generally in line with their European counterparts in how they collect data and look for ways to use them better and more efficiently while at the time meeting the needs of their customers Contextual marketing is about understanding a customer’s behaviour at a more granular level than ever before Given companies’ ever-growing ability to collect and analyse data, it is arguably the next logical step after personalisation And Dutch marketers, like their counterparts in other west European markets, are beginning to use contextual data to improve the relevance of the messages they share with customers, thus making their marketing more effective Whatever they may be calling it just now, there is no questioning that these data—despite the challenges and risks connected to their use—are seen as key to providing customers with more value © The Economist Intelligence Unit Limited 2015 ... Beyond personalisation: European perspectives on contextual marketing Although the best marketing channel to use may vary by category or customer, the survey reveals that a brand’s website remains... is happening © The Economist Intelligence Unit Limited 2015 Beyond personalisation: European perspectives on contextual marketing Dealing as it does with customer information, contextual marketing. .. contextual data 42 50 Respecing customer privacy 30 34 Measuring success of contextual marketing campaigns 24 15 Adapting marketing/ campaign processes to contextual marketing Other For MSD’s Mr Jansen,