One step forward. Two steps back.
This is the reality of the modern marketer struggling to develop advertising strategies that keep up with changing consumer behaviors. While shoppers move seamlessly across devices and channels as they research and buy products, marketers are largely stuck viewing these activities in isolation. But this is all about to change as Google just announced two new solutions that will certainly help bridge the measurement gap between the digital and physical worlds.
While nine out of every ten purchases still take place in a retail storefront, over half of these purchases are influenced by digital touch points (Deloitte). The problem is, marketers have been using “MacGyver-like” solutions to measure this cross-channel influence and properly allocate ad spend.
Over the last few years, many companies have attempted to unify offline and online data to improve the overall effectiveness of advertising. In 2012, LiveRamp, a data onboarding provider, introduced a way to match a retailer’s offline CRM data with their 3rd party online data to improve cross-channel measurement and better understand customer behavior. Adlucent was the first agency to partner with LiveRamp to more accurately measure the impact that our ads are having on storefront sales. We found that paid search was generating as much as 660% more sales in stores than we were previously able to measure. We also used this data to grow digital revenue by creating high-value audiences that are then activated by search ads.
While successful, this approach is not without its challenges. Data onboarding costs are high and often difficult for retailers to justify. Additionally, managing data transfers from multiple parties can steal valuable work time. Delays in reporting mean marketers can’t activate ads based on real-time data. Finally, the possibility of exposing proprietary customer information is often too risky for many marketers. What retail brands really want is a way to use their first party transaction data and activate it in Google Adwords directly.
Fortunately, Google has been working behind the scenes to create two simple, free solutions which they unveiled this morning at their Google Marketing Next conference.
The first is a partnership between Google and credit card companies to get store sales transactions from retailers into AdWords in a much easier way, eliminating the need for custom feeds. Google will work directly with them to upload customer transaction history which can be seen at the campaign level. While this solution won’t be able to track shoppers who pay with cash or credit cards backed by other companies, it will give marketers the data they need to more accurately measure the impact their digital ads are having on store sales.
The second new solution will allow advertisers who collect email addresses at the point of sale can easily import this information along with purchase information and the value of the sale directly into AdWords, effectively bypassing data onboarders. Google will then look for matches for their signed in users and report on store sales that are aggregated. This will help measure the value of people who are engaging with ads and then converting in stores. Also, with extrapolated sales data, you can show value beyond what can be directly measured. While it’s important to note that onboarders have different data and matching technology, this is a great opportunity for retailers to eliminate the additional cost and hassle of working with a third-party company and protect their own data. We remain eager to test these new solutions to understand Google’s match rates relative to LiveRamp/Oracle and Datalogix, but we suspect match rates will be similar to Customer Match.
With these new offerings, multichannel retailers will be able to more effectively quantify the impact their digital ads are having on offline sales. Many will realize they are underinvesting in digital and reallocate marketing spend towards online, a win for the team at Google. But retailers and Google aren’t the only winners here, as consumers will also benefit from an improved and more consistent shopping experience.
Here’s to one step forward, no step back.