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Can Advertising Really Be Customer First?

Alison O'Keefe

hand reaching between yellow and red peppers

Why targeting your existing customer base is beneficial to your return on investment

Marketers have all heard this from clients at least once: “Why should I spend money to engage someone that already buys my brand?”

To be fair, it isn’t a terrible question. The constant pressure to grow household penetration, sales and units moved is real, and the obvious answer isn’t to engage with people who already purchase your products. The ease at which brands can reach competitive households, especially with the growth of retail media, makes it all too appealing to try and steal share. Media proposals are continuously being built out to only target competitive buyers, and when good first-party data runs out, many advertisers turn to third-party data and weak customer signals to get the reach they need.

Brands spend a lot of advertising dollars to drive customers down the funnel. The majority is spent at the top, with billions going to linear television and video as awareness drivers. While this will never disappear, nor would I recommend that it should, there is value in being able to skip over the top of the funnel and find unique ways to engage with the customers that already know and understand your brand.

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The most successful programmatic campaigns have a couple of things in common. One: Driving that “one more X” purchase within your loyal brand base can lead to an incremental return on your investment. And two: Understanding your audience and what they engage with outside of your brand can help your campaign create the perfect usage occasion that inspires an incremental purchase.

When the data you have access to has the ability to see purchases down to the universal product code level, the custom content that can be created has a much higher likelihood of resonating.

While usage occasion marketing is not a groundbreaking strategy, many programmatic campaigns are implemented with unreliable data. This leads to a disconnect between the target audience and the message being delivered. Consider the endless possibilities of knowing what every household in your target audience buys, and delivering a custom message or recipe based on their top purchased products. That is personalization at its best!

Personalization isn’t only important when engaging with customers in the programmatic space. It should also be top of mind when a customer is on your owned sites. Too often, websites gather data on their visitors without allowing that knowledge to shape the customer experience onsite. It becomes all about creating segments to target customers offsite and drive traffic. Some retail sites put a lot of effort into tailoring their onsite experience to each customer.

Take, for example, Kroger’s “your next basket science,” powered by 84.51°. Based on a customer’s past purchases in store and online, 84.51° makes it easier to add favorite items to future shopping lists or online orders. The information can also be used to anticipate what new items with which the customer is most likely to engage, making the “advertising” as personalized and relevant as possible.

This strategy can go beyond e-commerce to brand and content sites. How different could your relationship be with the customer if you personalized the experience with what you already know they want? This allows you to build trust first and then make the advertising meaningful and successful.

I know what you’re thinking: What if my brand is new and doesn’t have a large loyal base? What if my boss or client still wants me to grow household penetration? Working with a partner that has massive amounts of first-party data allows you to gain a deep understanding of all customers, which in turn will give you direction on how to grow your brand.

If a retailer sees every product in a customer’s basket, tracked over time, segments begin to emerge. Take, for example, a customer’s propensity to try a new product based on their past purchases across multiple categories. As a company trying to launch a new product or brand, that segment would be very valuable and would help to make the media spend more efficient and effective.

So, can advertising really be customer first? It can and should be. The customer is telling us what they want through the data—we just need to be willing to listen.

Alison O'Keefe is an offsite media lead for Kroger Precision Marketing on the Product, Strategy and Innovation team at 84.51°.