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How will data, its role in advertising and marketing, and the relationship that businesses have with it evolve in 2021?
Earlier in the month, we took a specific look at the issue of third-party tracking cookies and how their ongoing demise is likely to impact measurement, ad targeting and attribution in 2021. But what other data trends are likely to come to the fore next year? How will the ongoing Covid-19 crisis and the way that brands respond to it impact the usage of data? And what about automation, artificial intelligence and the emergence of new tools?
We speak to a number of experts in data, analytics and advertising to find out what they see on the horizon for 2021.
1. Data strategy: responding to the impact of Covid-19
“Arguably the biggest trend in 2020 was the fast acceleration of digital,” says Justine O’Neill, Director at Analytic Partners. “As the high street was forced to shut down, consumers shifted online and brands were forced to focus on e-commerce, improving their omnichannel journey and new offerings such as click & collect.”
O’Neill notes that this shift in consumer behaviour led to an answering shift in media spend, with brands targeting consumers via digital channels and looking to performance marketing for rapid results. However, she cautions, “brands need to remember media synergies and not only trust in one channel. They need to constantly re-evaluate their marketing setup and not lose sight of brand and its halo importance. For instance, the more brands rely on promotions, the more will they have to rely on incrementality for their sales, not brand love.
“Our ROI genome shows that there’s a strong value in investing in brand, which tends to outperform product, promotion and functionality messaging 80% of the time,” O’Neill goes on. “However, it’s important to strike the right balance between branding and product messaging to make sure that we’re able to achieve both our business growth as well as our performance goals. It’s risky to favor short term growth over long term gains and brands need to be carefully watching this and the associated ROIs as the huge changes in 2020 might lead to skewed KPIs for 2021.”
Andrew Hood, Founder and CEO at Lynchpin and co-author of Econsultancy’s recent AI, Machine Learning and Predictive Analytics Best Practice Guide, observes, “2020 exposed for many the lack of critical foundations in place for many data strategies. Some businesses that needed to get on top of leading indicators as markets were disrupted quickly found that accurate and consistent data was either not in place or easily accessible at the right levels of decision making.”
Fortunately, Hood believes that businesses will take action to remedy this in 2021. “For many, [this] has pushed data strategy back to the top of the agenda for 2021, and with the changes in compliance and tools it’s an ideal time to be revisiting what the key use cases are for now and the future and focusing efforts in on those.”
Kristina Prokop, CEO and Co-founder at Eyeota, agrees that the coronavirus pandemic has “accelerated the focus on data” for many businesses. “Due to the maturity of the market, the depth of data applications and strategies have expanded despite the challenges of the coronavirus,” she says. “Since customers are coming online at unprecedented rates, the ability for brands to effectively acquire new customers is more important than ever.
“Using data to better understand existing customers and what attributes they have based on both first-party and non-first-party data enables brands to develop more effective targeting strategies. The acceleration of using data for more use cases such as first-party data enrichment, modelling and site personalization will continue to grow.”
The use of data to understand the customer mindset will also help brands to navigate the uncertain climate of early 2021, adds Mark Inskip, CEO, UK & Ireland at Kantar Media. “In 2021, we can expect to see brands challenging their data to deliver smarter, more joined-up insight. As uncertainty persists into the first months of the new year, brands who use that streamlined and enriched data to understand the consumer mindset, communicate accordingly and measure the impact of every aspect of their strategy will chart a path for growth.”
2. The role of data in the business in 2021
How will these changes in data strategy, and the lasting impact of the Covid-19 pandemic, affect brands’ overall attitudes towards data and the role that data plays within their businesses? Inskip believes that data became a port in the storm for many businesses during the turbulence of the pandemic.
“As we all know, 2020 turned the world upside down,” he says. “In advertising, brands longed for some much-needed clarity through the chaos. As teams looked to strategise, data’s role in guiding businesses through uncertainty could not have been more apparent and a hunger for actionable insight extracted from that data flourished.
“The importance of data isn’t new to businesses, but Covid-19 has fast-tracked how brands think about it. Just having data isn’t enough – as media teams navigate the huge amount of data available now, and the growing regulatory frameworks around it, a trend towards making existing data work harder to inform investment decisions is accelerating.”
“The biggest challenges in 2021 for marketing decision makers will be further uncertainty, moving consumers and budgets, brand building and ecommerce,” adds Analytic Partners’ Justine O’Neill. “If coronavirus has taught us anything, it’s to experiment more. As budgets continue to be tightened, the rule book has been thrown out and sacred cows can be challenged. Brands must shift away from a share of voice approach to a more optimised strategy, drawing on real time data to shift their campaigns and strategies in line with the ever-changing guidelines.”
Christian Selchau-Hansen, CEO and Co-founder at Formation.ai, believes that data is becoming the most valuable asset that companies have – but they aren’t necessarily treating it that way. “With digital engagement and adoption having massively acerbated in COVID, companies have new and incredibly valuable insight into their customers. Data is quickly becoming companies’ most valuable asset. Yet most companies don’t measure returns on this asset in the same way they do others. This should change immediately.”
He also believes that it is vital for marketers in 2021 to become “data science capable”. “Being a marketer today is hard, but to be successful you need to be able to access and use data to improve your understanding of your customer and achieve measurable business outcomes.”
3. Trends in measurement & analytics
What about the way that businesses approach insights, data measurement and analytics? Michele Morelli, Executive Vice President of Global Marketing at Toluna, believes that because of the fundamental and unprecedented impact of Covid-19 on consumer behaviour, marketers will rely on real-time measurement rather than previous trend data, which relates to an era before the pandemic and thus cannot be usefully relied on.
“There will be a greater emphasis not only on measuring consumer opinion, sentiment and behaviour in real-time by using technology platforms or SAAS, but changing the marketing mix to one that is technology-based and enables agility, with an emphasis on digital media or that which operates like digital media (such as streaming ad insertion),” she says. “This will lead to an increase in automation and leveraging technology for customer centricity. These have always been core to marketing, but the pandemic accelerated the need to implement technology to create flexibility in marketing plans. The one key thing I cannot stress enough is the need to focus on the rapidly changing behaviours and sentiments of today’s consumer.”
The upshot of all of this, predicts Morelli, is that insights professionals will have “a greater seat at the table”. “Not only will the amount of insights produced be greater (because of increase in message testing and brand perception) but with instant access to insights, the insights person is literally the voice of the customer. Since brands cannot rely on past trend data to predict the future, the insights person is more important than ever before. And marketers realise it.”
Lynchpin’s Andrew Hood believes that the recent release of Google Analytics 4, the latest version of Google Analytics, will inevitably have a widespread and lasting impact on the way that marketers approach metrics – particularly due to the fact that Google has opted to retire bounce rate as a metric in GA4.
“Whether or not you are a Google Analytics user and/or fan, the release of GA4 in the autumn of 2020 represents some big shifts in industry thinking that are likely to have far broader impact in 2021,” he says.
“Firstly, the paradigms of page views and bounces – that perhaps never worked that well for websites and certainly didn’t work for mobile apps – are being consigned to history in favour of a more straightforward event-based model. Secondly, that model starts to point to a world where we potentially count interactions without identifying users – a pretext perhaps to enabling truly anonymous cookie-less measurement in some scenarios.
“Finally, the provision for the first time in the free GA tool of raw user-level data streaming to BigQuery suddenly opens a whole new world of attribution modelling and personalisation capability to a much broader audience.”