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WFA’s new research explores the importance of data for marketers

Research

WFA’s new research explores the importance of data for marketers

New research from the World Federation of Advertisers (WFA) demonstrates how data has become important for brands seeking to understand consumers and deliver personalized marketing. The research has been conducted in conjunction with The Customer Framework and is based on responses from 32 companies with a global annual marketing spend of $35 billion.

The research reveals that, as data consumption and processing increases, marketers are becoming increasingly respectful of consumer privacy and how they handle personal data. Seventy-two percent of senior marketers view data as a strategic asset, although more than half are just starting the process of giving it a central place in their marketing. Thirty-one percent described themselves as advanced or highly advanced in the adoption of data-driven marketing (DDM) using multiple data personalization and segmentation techniques. These advanced companies were underpinning their efforts with a range of technology solutions including customer relationship management (CRM) systems, analytical systems, data management platforms (DMPs) and rules engines.

However, not all companies are as advanced. Fifty-six percent of respondents recognize that they are still early in the journey – in the initial planning stage at best – and have yet to deploy a DDM strategy.

The study also found a range of confidence in analytics, with only half “somewhat confident” and 27 percent “not very confident” in their ability to identify return on investment via data analysis.

Nevertheless, investment into analytics and insight is on the rise with 89 percent of respondents expecting to increase budgets and 31 percent to boost them “greatly”. The goal is to evolve the analytics function from historical reporting of ‘what happened’ to more predictive and prescriptive approaches – something that a quarter of respondents already claim to be able to deliver.

The desire to build direct customer relationships via the use of first-party data was clearly highlighted by the research, with 73 percent of respondents considering this ‘business critical’ and 88 percent planning on ramping up usage.

With the increased use and processing of consumer data, however, 85 percent of respondents acknowledged that privacy is integral to building customer trust, and more than just legal compliance.

New data protection legislation in Europe, for example, which is expected to come into force in 2017 following a two-year implementation period, will create a number of additional compliance obligations for brands seeking to process data for marketing purposes.

Yet, even with these additional rules, brands recognize that their ability to embrace a data-driven future relies on increasing consumer trust, which, in turn, requires brands to go beyond compliance. Eighty-five percent of respondents viewed data privacy as an integral component of customer trust, not just ‘legal compliance’

Such considerations should ideally sit within a brands’ Customer Information Strategy, documenting among other things, what data is required, how it is to be used, where it can be obtained and whether it should be owned. Customer Information Strategies were found to be in place for just 55 percent of respondents.

“To make the most of their investment in data planning, execution and analysis, companies need to develop the right organizational structure to deploy commercial, practical insights combined with a program to improve data-driven marketing capabilities across the organization”, says Nick Broomfield, director and managing partner at The Customer Framework, in a press statement.

“It’s no secret that data has become important for marketing purposes, though it’s interesting to note that even some of the world’s biggest companies are only at the early stages of delivering data-driven marketing strategies. Data consumption is set to increase rapidly and with that sophistication – clarifying how data will be used and how consumer privacy will be protected, should be a fundamental component of a brand’s strategy as it advances into DDM,” adds Matt Green, senior global marketing manager at the WFA.

 

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