Personalization is far from a new marketing concept – and the digital landscape has well-established expectations and best practices for performance marketing channels (email marketing, display, and even site experiences). But as we approach 2019, the democratization of data and dynamic creative tools will push personalization into a far broader and more complex range of advertising touchpoints. In this landscape, it is crucial for marketers to have a clear framework for harnessing the unavoidable complexity this creates and to learn to manage a fluid creative ecosystem – finding the perfect balance of art and science.
While personalization has progressively spread throughout digital media with steadily improving capabilities, video has been surprisingly immune. However, digital video is now poised to become the next frontier of personalized advertising. Since 2012, U.S. digital video viewership has grown 32.6 percent, and the amount of time spent consuming video each day has more than quadrupled since 2014. With this remarkable growth comes an influx of ad dollars and, in lockstep, expectations for short-term payback. By 2021, digital video ad spend is expected to top $22 billion, a 43.8 percent increase compared to 2018, bringing about new challenges and opportunities for our clients.
Consumers are moving from being connected to being hyperconnected, and their expectations for more personalized experiences increase as their attention span decreases. According to a recent Martech Today article:
And a recent Epsilon survey reported that 80 percent of consumers are more likely to make a purchase with brands that offer personalized experiences. Once a value-add part of marketing, personalization is now table stakes.
For example, imagine a taco chain that is running a digital campaign. Two targets fall into the overall strategy – an older gentleman who has recently visited a couple of health food restaurants and has downloaded a calorie-counting app on his phone; and the second, a lady in her twenties who frequently orders fast food online at lunchtime. Serving the same video at the same time to these two targets, even with creative that has performed well in aggregate, may not be as successful as providing a more personalized experience.
Considering the variety of behavioral and contextual data that is available and actionable for each target, such as their demographic characteristics, websites they are visiting, apps they are using, and even where they are going, the chain could alter the featured menu item, the offer, the music, or the timing of an ad to better appeal to their individual tastes. The first target may get an ad that includes a shot of a light taco salad with messaging about healthy options, while the second may get an ad with a decadent taco combo and an offer highlighting the chain’s loyalty program shortly before lunchtime. Or the chain may choose to suppress its advertising for the second target, knowing they frequently choose restaurants like it even without advertising, allowing the investment to be spent on someone who needs more persuasion. The increased relevancy for each customer will significantly increase the chances of grabbing their attention and delivering the most profitable offer.
Because of advancements in a few key areas, digital video personalization will be a big area of growth in 2019:
Data silos are becoming a thing of the past. New innovations are making it possible to observe consumers more broadly and capture what they are doing online even more granularly, creating a rich and integrated view of the brand’s customer.
As the McKinsey Global Institute has put it, “Data is now a critical corporate asset. It comes from the web, billions of phones, sensors, payment systems, cameras, and a huge array of other sources – and its value is tied to its ultimate use.”
In addition to the variety of media data and proprietary customer data that firms have collected, new types of data are being surfaced for marketers to integrate. Location-based data allows us to see where consumers are located when doing certain activities online and even where they have been when not online (based on GPS-enabled smartphone mapping). And now device maps tie together all the different ways consumers access the Internet. So if Joe views an ad online and then goes to the website for that brand on his phone, there is now the ability to tie those together.
The availability of these new data sources – and methods for matching, transforming, and making it available for advertising technology to act on – has created a new playground for decision scientists and data analysts to model potential growth opportunities.
The next great challenge is choosing where, when, and how to deploy this data for personalized communications.
True personalization at scale requires decisions to be made on the fly through machine learning. But it is a common misperception that machine learning is self-governing. Launched and applied incorrectly, allowing an algorithm to make content delivery decisions without clear oversight from an informed team could actually decrease performance.
To be successful in coordinating a personalized video ecosystem, teams need to align on a campaign structure that restricts creative adaptations to specific factors. To start, consider aligning your campaigns with adaptive triggers for:
New tools are being introduced constantly that help brands get closer and closer to fluid content personalization. Some tools focus more on the tactical execution of the content, while others focus more on development of the creative assets that can be used for delivering a personalized experience. These tools are designed to leverage the data and the learnings from higher-level mathematics to make personalization a reality.
Google, owning the largest digital video platform on the Internet, recognized the opportunity and has developed a suite of new tools for personalized video ecosystems. For brands looking to evolve their personalized advertising in 2019, we recommend focusing on YouTube’s digital video customization tool, Director Mix, as well as a new ad sequencing tool allowing you to control the story arc across digital video assets per user.
YouTube’s Director Mix platform allows advertisers to customize their digital video ad units based on a variety of highly targeted audience segments, in theory allowing for the creation of a unique ad unit per each user. Whether brands decide to target by age, demographic, parental status, region, demographic market area (DMA), interest, in-market segment, etc., brands can then alter their campaign’s story, video duration, soundtrack, voiceover/dialect, message, imagery, call to action, or a variety of other variables – all unique to each viewer. While by no means the first customizable ad platform, it is the first of its kind built by Google with the capability to use its custom affinity audiences and in-market audiences in this capacity.
However, video targeting doesn’t end with Google-defined audiences. Coupled with market research and audience insights, Director Mix allows media planners and creative to work together to identify opportunities unique to each audience and then craft highly customized messages. The tool itself can also be used for research, understanding which messages perform best with each audience. Perhaps leading with a branding message works best in the Northeast, but in the Southwest they like to see the funny headline first.
For our initial test with Director Mix, our client’s goal was to drive store visit conversions while reaching its audience in a unique way. After pulling YouTube audience explorer reports, we segmented our audiences based off a user’s detailed demographics, geography, and unique affinities – including music taste, hobbies, and television habits. Utilizing this data, our creative and media teams worked together to develop customized video assets for each audience segment. These customized layers included:
With these unique assets targeted across our 160 geotargets, the Director Mix test ended up with over 12,000 video assets served dynamically to each user. With a short run of only two weeks, we saw tremendous results. Director Mix generated over 180,000 store visits at a cost-per-visit 87 percent below our benchmarks. We were also able to use this data in ways we hadn’t originally anticipated.
Rather than just utilize our data for targeting and customized messaging purposes, Director Mix provided its own granular data for each audience segmentation, helping us further understand which audiences were most receptive to our message and how long they engaged with our brand. Based on these results, we have optimized our audience segmentation for future tests and developed additional customized assets based on seasonality. The possibilities are truly limitless, and we’re only at the beginning of this exciting new time – the collision of art and science.
If Director Mix allows advertisers to personalize a single video based on the variety of data points available about the audience, the Video Ad Sequencing beta enables advertisers to customize which videos get shown to that same user over time. The tool allows advertisers to tell stories across multiple videos and test various messaging sequences for specific target audiences. For example, if someone is served a video for a brand and watches it, the content they receive next will be different than someone who was served the video and did not watch it.
As segments or customer life cycle stages change along a customer journey, so too can the content delivery. Teams of creatives, media planners, and decision scientists can take advantage of this system to constantly optimize which assets are working best at the individual level, continually improving performance in real time.
Pairing these tools – Director Mix and Video Ad Sequencing – gives advertisers unprecedented control over how their brands create a connection with their different audiences over time. This highly fluid environment means that creative and media teams need to be more in sync than ever before – each offering a unique insight into what is working and what else can better connect with a brand’s target audience.
So what does this mean for our advertisers? As their data becomes more accessible and technology continues to improve to match this data, agencies will have to evolve the way they look at creative. Whether it’s an engaging headline referencing hobbies/interests, a toe-tapping music track based on listening habits, or a backdrop of the city’s skyline, YouTube’s Director Mix platform and Video Ad Sequencing tool offer an infinite number of ways to craft our messaging to engage with our clients’ target audiences and stand out from the clutter.