Digital Marketing Report from Lyris, EIU

From the Lyris/EIU report, Mind the Marketing Gap

Digital marketers know what consumers want, right? Not according to a new report from data-driven marketing provider Lyris, which found that marketers are not effectively using Big Data to correct their misunderstandings. But the report also raises some questions about its own conclusions, resulting in a disclaimer by the survey-taker. 

Conducted by The Economist Intelligence Unit (EIU), part of The Economist newspaper, Mind the Marketing Gap found several major disconnects between marketers’ strategies and consumers’ wants. For instance, consumers rank email as the single most important channel for getting an initial introduction to a product, cited by 37 percent of respondents. Only about one in five said that social media and blogs were preferred for assessing products for purchase.

Data-Driven Best Practices

Even younger consumers aged 20-30 ranked websites and email over social media and blogs as the preferred way to engage with a brand. Websites were preferred by 48 percent of this younger set, email by 19 percent, and social media sites and blogs were way down at 5 percent and 2 percent, respectively. But, the report noted, while 32 percent of marketers say that an “understanding of best practices in email delivery” is second in importance only to the ability to extract useful trends from Big Data for marketers, company budgets still favor websites over email.

Alex Lustberg, Lyris CMO, said in a statement that the report “found several important gaps between what marketers think their customers value, and what they really care about.” The solution, he said, is to follow best practices that are data-driven, not finger-in-the-air-driven.

Then there’s personalization, a common emphasis of many website-based marketing efforts. The report said that most (63 percent) of respondents thought personalization is now so common they have become jaded about it, and a third said that “superficial personalization” based on generalized data can be annoying, although they like personalization based on an individual’s profile. Only 14 percent said they like to read personally-addressed communications.

Personalization, Customization

The report makes a distinction between personalization, based on aggregate user attributes, and customization, based on such data as past transactions. Customers prefer customized recommendations, the report said, which marketers are beginning to emphasize more than five years ago.

But, in trying to find out which flavor of personalization works for consumers, marketers have to be careful about not treading on privacy issues. Forty-nine percent of consumers reported that they were concerned about threats to their online privacy, but only 23 percent of marketing executives thought that their customers were very concerned about that issue.

To close the gap between what consumers want and what marketers are prepared to deliver, the report recommends a better analysis, understanding and use of Big Data. Marketers are behind the times, with 45 percent of marketers saying a lack of capacity for analyzing Big Data is their biggest obstacle to more effective digital marketing strategies, second only to inadequate budgets for digital marketing and database management.

Questions about the Report

This report, however, raises some questions about its own methodology and conclusions.

Learning Opportunities

One caution about reading the results of the report, for instance, is the relatively small size of its survey samples -- 409 consumers and 257 marketing executives at a CMO or VP level in the U.S. and the U.K., across six different consumer industries. Additionally, the report notes there are significant differences in how the six industries choose to influence customers, but, with such a small total sample, one wonders how valid generalizing statements that apply to all six might be.

Another caution is the report’s confusing comparison of terms, some of which could call some of the findings into question.

For instance, it says that consumers are “put off by superficial personalization, but they appreciate customized product recommendations.”

Yet the chart shown to support that statement is entitled “Net Consumer Preferences for Personalized Communications,” and the three bars in the graph distinguish between preferences for product recommendations, individualized communications and customized presentations of web pages. Setting aside the possibly unfair comparison of the words “recommendations,” “individualized” and “customized,” the key differences would appear to be between getting product recs versus getting communications or web pages. The differences in how that information is particularized would appear to be secondary.

The EIU Disclaimer

Most importantly, the report emphasizes the need to better use Big Data, without actually specifying the techniques or trends that need to be adopted or monitored -- even while it finds that consumers are turned off to targeting based on aggregate data and prefer personalized attention based on their own histories. But doesn’t Big Data utilize aggregate data analysis? How do consumers know the difference? And what kinds of data-driven marketing would better mesh with consumers? For instance, if customers prefer emails for product intros, what is the missing Big Data element?

Another caution: in discounting social media as an influencer, the report first cites email as the preferred method of product introduction, and then says only one in five prefer social media and blogs to make purchase assessments. But aren’t product intros and purchase assessments different points in a customer’s steps toward making a purchase?

The report presents many interesting findings, such as support for the idea that Big Data and marketers are still learning how to live with each other.But the kinds of apples-and-oranges comparisons noted above, the small sample sizes, and the lack of specifics about what Big Data analysis would be best and why, raise as many questions as it attempts to answer about what digital consumers actually want. Perhaps that’s why there’s this curious disclaimer from EIU accompanying the release of the report:

The Lyris release accurately cites several statistics from the EIU survey. The EIU, however, does not necessarily agree with all of the interpretations set out in the release because they attribute cause-and-effect relationships that the survey does not necessarily demonstrate. However, nothing in the release is explicitly at odds with the survey results."