Fashion apparel and retail companies are collecting reams of data on consumers. From product and color preferences to shopping frequency and favorite brands, the data is comprehensive.
But are companies using all of these data points effectively? Martin McNulty, chief executive officer of London-based Forward3D, which works with brands such as Ralph Lauren, Gucci and Etsy on search and display marketing campaigns, discusses current technology trends and how to develop relevant marketing strategies using data.
WWD: Retailers are awash in data about consumers. How do companies know what data is most important to collect?
Martin McNulty: This is a very hard question because the data we’re able to collect is constantly expanding. Collect everything and you’ll drown. Collect nothing and you’ll fall behind. In simple terms you care about data that you can use. There’s a ton of stuff out there that’s “interesting,” but if you can’t use it then it’s really just a waste of resources to go on collecting and analyzing it.
A good place to start is around media and promotion. Brands need to ask themselves what data will help them better spend their promotional budgets? Is there a lever I can pull each time I spot a specific pattern. i.e. can I allocate more budget to a specific tactic? A new area of focus now for brands is the relationship between offline and online. We’re starting to see methodologies that allow brands to understand the relationship between ads online and in store footfall.
WWD: Some would say companies are not using data the right way. What would you say?
M.M.: This is almost certainly true. Typically two forces are at play. The first is “silo-ing” i.e. online teams are kept apart from offline teams. Patterns that could be discovered are missed because the two worlds don’t meet. The second is around skill sets. In order to determine what data you should collect you need to be able to spot patterns and build models.
The process needs to be organic and ongoing. No one can tell you in advance what those patterns will be so you need people in your organization that are comfortable manipulating data and creating models. These skills don’t typically exist in marketing teams and central IT/Infrastructure people are usually incentivized to build systems that are predictable and work in set inputs. These people aren’t about discovering the unexpected. They’re all about managing what’s known today.
WWD: How does your firm engage clients? Many companies have well-polished sales teams, but they’re not necessarily knowledgeable about technology. What does your firm do differently?
M.M.: We engage clients by telling them we don’t know the answers. Instead of pretending to have a crystal ball we instead sell our methodology. Iterative development and discovery tends to highlight failures quickly. This may seem like an odd thing to shout about, but supporting a cmo in deciding what not to do is just as important as what to do. Many a cmo have bet their careers on big infrastructure projects (a new Web site or a new CMS system) only to discover the problem lies elsewhere.
We’re great at hacking things together quickly. We build investment rationales using results, not future-gazing. This is why we don’t typically have specialist sales people. Sales people are good at selling the “known.” They’re less good at selling the unknown. Our model works because our analysts are also our sales people. When clients decide to work with us, they’re really buying the expertise and brain power of the person in front of them. It’s sometimes a scary thing to commit to, but ultimately it delivers better results. Nothing is standard today. Everything is changing and you therefore need to invest in methodologies that can react to this, not out-of-the-box systems and approaches.
WWD: What are some of the trends you’re seeing in the market now? What’s the next big thing?
M.M.: Data is really where it’s at. The Internet of Things is going to change the way we view data. Instead of reacting to what you do on your desktop or phone, marketers will soon be appending device data to their campaigns. Is someone searching for a restaurant in a car different to someone on foot? Does the speed of the vehicle have any bearing on the choice of ad you show? This is such a simple, almost mundane example of the power of [the Internet of Things] and I think we’ve barely scratched the surface of a world where both humans and devices begin talking to the cloud. Obviously there are huge issues of privacy to overcome but in the long run, I think the value that incorporating data like this will bring is enormous.