MARK READ: We have a strong business with KBM Group, but it operated separately from the rest of the business. We embed data into the insights we deliver, into the way we target messages and the way we measure results. You judge the campaign by success measured in sales, rather than likes or views or even brand metrics. I saw someone quoted saying, “The metric for our work is engagement.” I don't think that’s the right metric. The metric clients want is sales.
How do you accomplish that?
Because we manage a lot of data platforms for clients, we can track work from campaigns to sales. We look at our clients’ first-party data and try to measure the impact of the work on the consumers.
Where’s the room for improvement?
We’re happiest in higher-value categories: airlines, automotive and B2B, where there’s a much closer link to our activity and sales. In lower-valued packaged goods scenarios, we’re not as able to do that as we would like.
Is there any way to do it?
We run a loyalty program for Adidas out of Copenhagen. We have more than 100 million customers in the program where we can link the activities we run to sales because people go into stores and use coupons.
In packaged goods, we use iBehavior to look at an audience exposed to a campaign versus not exposed. You can measure the uplift, but it’s harder to do that effectively. iBehavior – which has the same capability as Datalogix – collects data on more than 250 million consumers in the US with 30,000 retailers. That’s linked to a customer profile and we measure the effectiveness of a campaign based on that.
Is it possible to close the loop for consumers who aren’t part of a loyalty program?
Not yet. Not on a census level. You can do it on an exposure basis, like what Datalogix does with Facebook. But it’s very hard to link online activity to offline environments at an individual level. There is potential. We’d love to run a program for a packaged goods company that wants to build a relationship with a billion consumers. The cost of the infrastructure and technology is massively lower than it was five years ago.
A lot of technologies used in airlines and financial services will be applied to CPGs. You see that with Unilever’s purchase of Dollar Shave Club. They’re starting to build a direct relationship with consumers.
What do CPGs have to consider as they build that direct relationship with clients?
Who owns the customer relationship? Is it the retailer or the packaged goods companies? Increasingly, packaged goods companies are trying to find ways where they can own more of that relationship. And it may not be on one product, but it may be on a bundle of products.
Let’s talk Google and Facebook. Assuming their massive acceleration continues, what are the opportunities and challenges for agencies like Wunderman?
Our job is to help our clients get the maximum ROI from those platforms. The bigger [Google and Facebook] become, the more time we need to spend with them and the more we’ll have to understand what they do.
Is there a competitive element since the walled gardens want to work directly with clients?
I don’t totally agree with that. Facebook and Google are different. Google has a greater focus on media budgets, media allocation and programmatic media, so it’s slightly more aggressive on the media front than Facebook.
While they both want to approach clients as they want a greater share of budgets, they should realize the best way to do that is through the agencies. Wunderman has 7,000 employees, so unless Facebook wants to hire more people, they’re best doing what they do best and letting agencies do what we do best: working with clients, coming up with ideas and helping clients manage the ROI on their platforms.
Don’t the walled gardens have unique data assets that they can leverage?
Both [Facebook and Google are] walled gardens help us because clients can’t go to Google to place their media on Facebook or go to Facebook to place their media on Google. They need us to help them understand how to allocate their media, and I don’t think a client would go to Facebook to ask how to spend their budget any more than they’d go to NBC and ask NBC how to allocate their budget.
Isn’t NBC building out a platform to do that?
If clients want to have 25 independent relationships with 25 independent media companies, they’ll need a trusted adviser to help manage the 25 and we’ll be back where we started.
Speaking of large media companies, let’s talk about Verizon, which recently announced plans to buy Yahoo. What does Verizon need to do to interest you?
Verizon needs to pull its assets together and define what they mean to the consumer, particularly from a data perspective. Yahoo never really knew what it stood for and spent the last 10 years searching. I don’t know if being acquired by Verizon solves that problem.
Google’s and Facebook’s great power is the ability to look at the customer and understand what they’re doing across all channels and platforms.