Addressability: The New Term for Digital Marketing

BuzzFeed's recent article on digital personalization reminds us again of how marketers can obsess on "the trees" (semantics) and miss "the forest" (the power of digital to drive great marketing).

To frame the issue, we must recognize where we are: at the precipice of a new age of marketing, where digital can empower unprecedented levels of consumer insights, knowledge and performance.

Let's step back and recall the wisdom of the Yoda of marketing, Peter Drucker: "The aim of marketing is to know and understand the customer so well, the product or service fits him and sells itself." — "Management: Tasks, Responsibilities, Practices," (1973)

Drucker's quote is famous because it's arguably the most succinct, yet complete definition of marketing ever published. Its power is in its implication to the professional marketer: if you're doing your job well, it shouldn't be that difficult … or complicated. Understand your customer.

His words are timeless. More than 40 years later, this definition and its implication are more relevant than ever. Digital's potential to provide a deep, accurate and timely understanding of consumer needs and demand is beyond the imagination of marketers from 10 years ago, let alone 1973.

And yet, instead of focusing on what's possible, we debate the "label" for digital marketing: Personalization? Relevancy?

It's neither and both. The best term is "addressability," which is the process of customizing a brand's message, product, placement and timing to match the personal lifecycle needs of the customer at a specific point in the purchase cycle, thus optimizing relevance.

What has to be understood and balanced in order to deliver addressability?

• Identity vs. anonymity: You don't have to know a person's name to be addressable. In fact, millennials want you to know them, without knowing them. Get it?
• Shopping experience vs. used car salesman tsunami: Remember the customer's perspective: looking at a pair of pants on a site doesn't mean I need to see 50 ads for 25 brands in the next 10 minutes. Lighten up, Francis.
• Connected recognition: Today, most retail brands haven't made the necessary commitment for strategic design, tools and process to understand the behavior of their best customers, and thus act in a way that will endear, not offend, customers.

How can I shop at your store so often, yet still get pounded by digital ads and emails that promote items I have no interest in? Or, at other times, feature items I recently purchased? You don't really get me, do you? Worse, you're not paying attention to me.

For retail brands, here's the more appropriate headline: If your customers think your digital communications are "creepy," you're not doing it correctly.

Addressability requires a new synergy of capabilities, process and skills from the three major digital disciplines:

1. Infrastructure: A database that fits your business model, with modular design that adapts to the highly organic/evolving tech stack; a data management platform that appropriately harnesses personally identifiable information (PII) and mobile data, instead of shallow and soon-to-be obsolete cookie data; and advanced email platform design vs. treating email as a "free" marketing tool.
2. Analytics: A process that harnesses the expertise of dedicated analysts to continuously synthesize a brand's first-party data with deep, rich third-party data. Results? Iterative and robust segmentation and insights; effective and accurate audience modeling; mapping and prioritizing real-time media behavior; and fact-based marketing attribution.
3. Plan execution: Programmatic media/platform execution focused on message optimization, not impressions tonnage, based on insights-driven plan design; life cycle and purchase cycle alignment; location and timing proximity; and test-verified creative design for myriad platforms and devices.

Yes, marketing terms and definitions matter. For retail, the term is addressability, and the definition is connected CRM. Digital can be personal, relevant and effective without being "creepy." A deep understanding of your customers brings effective brand engagement without the trench coat image.

If Drucker were alive today, he would excoriate retail marketers for debating, instead of acting on, the game-changing opportunity of digital. Let's get going.

Karlin Linhardt is vice president, strategic partnerships, for Merkle, a performance marketing agency specializing in data-based marketing solutions.