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The Rise of the Platform Marketer

Performance Marketing with Google, Facebook, and Twitter, Plus the Latest High-Growth Digital Advertising Platforms

Craig Dempster

John Lee

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In 25 years leading a growing, evolving customer relationship marketing company, I have witnessed a number of major industry shifts, propelled by advancements in technology, increased access to data, and improvements in analytic techniques. The digitization of just about everything in the lives of consumers has brought about the greatest shift of all—the ability for marketers to customize the brand experience to the individual customer. Through personalized interactions that take place via online and offline media and channels, across multiple screens and platforms, throughout the customer lifecycle, today's marketer can truly optimize the value of the customer portfolio. The opportunity of addressability at scale far surpasses those of eras past.

My colleagues, Craig Dempster and John Lee, were among the forward-thinking leaders who recognized this opportunity early on. Together, we spent the first few years of this decade developing a customer relationship marketing (CRM) approach we call Connected CRM (cCRM)®, which has proven itself in activating customer-centric strategies for Merkle's Fortune 1000 clients.

My 2014 book, Connected CRM: Implementing a Data-Driven, Customer-Centric Business Strategy, outlined a highly structured organizational framework for building customer strategy as a business strategy. The concept of the Platform Marketer was first introduced in that book as the persona that harnesses a new set of skills necessary to operate within the cCRM framework. And in the year since it was written, Craig and John have been closely involved with clients who are establishing and executing cCRM strategies.

With that experience, we have expanded our thinking. We have cultivated a deeper understanding of the addressable audience platforms and further honed the Platform Marketer skills, whose influence and complexity we didn't fully realize when I wrote cCRM.

As the market's movement toward digital accelerates, so does the movement of marketing spend, with brands investing in new technologies that enable addressability in all their customer interactions. These growing and constantly fragmenting digital audience platforms, such as Facebook, Google, and Twitter, are the new frontier of marketing. They open countless avenues for creating relevant engagements with consumers. The opportunity is so vast and multifaceted, we've come to realize that marketers must begin to retool themselves, at the most foundational level, in order to master the rapidly proliferating digital platform opportunity.

In writing The Rise of the Platform Marketer, the authors enlisted the support of a team of expert contributors, authorities in their own fields of study, to ensure that the content is comprehensive, accurate, and adaptable not only across industries but over time and through constant change. They have expertly outlined the competencies required to remain relevant in marketing today, producing results that include not only competitive advantage for your organization, but for the individual reader—the Platform Marketer. I hope marketers will read this book and absorb the valuable skills needed to stay up to speed on the digital audience platforms and capitalize on the opportunity of addressability at scale.

David Williams

Chairman and CEO, Merkle


For decades, the concept of customer relationship marketing (CRM) has attracted executives who believe in customer centricity and the idea that customer strategy should be the basis of the business strategy. In his book, Connected CRM: Implementing a Data-Driven, Customer-Centric Business Strategy, David Williams defines Connected CRM (cCRM)® as the systematic practice in which marketers identify, acquire, and retain customers based upon their value. Through a framework that supports these orchestrated customer interactions, brands are able to improve financial results, create competitive advantage, and drive shareholder value.1

As marketers, we've always known that the key to competitive advantage is to be the brand that better understands the needs and behaviors of individual consumers. That intelligence allows the brand to create greater value through more personalized, relevant experiences. Over the years, advancements in data management, technology, and analytics have continuously enhanced our capacity to build vital customer intelligence.

More recently, the mass digitization of media and channels has allowed marketers to take that knowledge to another level, driving ever more personalized engagements with individual consumers, delivered across the complete range of media, channels, and devices. Today, the market refers to just about everything as media. As a marketer, you have countless avenues for addressing consumers, whether by reaching the audience through third-party sources, such as display or search (paid); building buzz through social communities, industry chatter, or even public relations (earned); or by making first-party connections via your own properties, such as website or mobile apps (owned).

Addressability at scale is the opportunity to create competitive advantage through the delivery of targeted, personalized experiences to consumers. Media and channels that are enabled by addressability at scale can be described as “addressable audience platforms.” An audience platform is a digital technology that enables those automated experiences to individuals (known and anonymous), at scale, utilizing first- and/or third-party data. Every interaction is an opportunity to collect and leverage data. But only now it has become possible to manage these disparate interactions at scale, as the digital audience platforms, such as Facebook, Google, and Twitter, continue to develop and grow. And our ability to build such wide-reaching connections across the addressable platforms has enabled us to foster relationships that span the customer life cycle and thus optimize the value of customers and segments.

To develop such relevant engagements with consumers through these platforms, brands are beginning to realize that they will have to cultivate an elevated set of capabilities, tools, metrics, and processes, along with a new set of skills to utilize them. This new breed of marketer—the Platform Marketer—has a deep understanding of traditional marketing and CRM principals, yet possesses the knowledge and innovative forethought to thrive in the ever-expanding digital audience platform environment. Due to the increased complexity involved in leveraging data, technology, and analytics in the digital era, platform marketing is not for the faint of heart or the complacent. Successful Platform Marketers will be steadfast innovators, dedicated to navigating undiscovered territory, wrought with twists, turns, and heavy lifting. But for those who can capitalize on addressability at scale, the spoils will include more profitable customer relationships and sustained competitive advantage.



Even before David Williams's book, Connected CRM, hit the virtual display shelves of Amazon, we already had our sights set on a follow-up book. We knew that marketers would require a whole new set of competencies in order to execute on a Connected CRM (cCRM) strategy and take advantage of the opportunity of addressability at scale that is made possible by the digital audience platforms. So we rounded up our colleagues who are widely recognized as leading experts in the capricious fields of data, analytics, technology, and organizational consulting. In the ensuing months, we worked together to construct what we believe will be the preeminent guide for marketers who are ready to achieve customer centricity in the age of digital.

There is one reason we felt the sense of freedom, the confidence, and the latitude to follow through with our vision for this book: the leadership of David Williams. He has shaped Merkle into a platform upon which his team can learn, grow, err, and succeed through experiences that help not only our clients to flourish, but also our company and our own careers. He has nurtured a culture that breeds innovation, bringing together some of the smartest minds in the marketing world to tackle the tough challenges of a constantly shifting marketing landscape.

We owe a very special thanks to all of the subject matter experts and their teams who contributed to the chapters: Patrick Collins, Peter Kemp, Matthew Mobley, Matthew Naeger, Megan Pagliuca, Bennie Smith, Leah van Zelm, Peter Vandre, Anudit Vikram, Kevin Walsh, and Zimm Zimmermann. Without their expertise in the critical building blocks of the Platform Marketer competencies, we couldn't have written this book at the level of detail required to materially impact the reader ready to hone these skills.

We would also like to acknowledge the vital role played by Sherri Aycoth, who is the heart and soul of our communications, with her unique aptitude for capturing our team's ideas and vision and bringing them to life in words. Over the years, she has shown undying commitment, playing a key writing role in both Connected CRM and The Rise of the Platform Marketer, in addition to her lead marketing communications role for Merkle. We could not have completed this book without her steadfast dedication to company, team, and mission.

And for her fearless leadership of Merkle's marketing organization, we thank Jeaneen Andrews-Feldman, SVP and chief orchestrator of the many levers it took to keep this project on path. Her invaluable relationships with the executive committee, the content team, the marketing and PR teams, the publisher, the media, and our clients have made months of effort move smoothly forward to fruition.

Finally, our most important recognition goes out to our families for their ongoing support, not just during the writing of this book, but throughout our careers. There is no way we could succeed in this business without spending time outside our day jobs, partnering together and reflecting on the future of marketing. The time we spend on the road is time not spent with family, and we owe them a debt of gratitude for their patience and encouragement—and for always being there to back us up on the home front. It's only through that support that we feel free to pursue new ideas and innovations that elevate the potential for marketing success.

—Craig & John

Chapter 1
The Age of the Customer

Customer relationship marketing (CRM) isn't merely about the implementation of a tactical marketing plan. A true customer-centric business strategy requires a fundamental shift in the organization's framework—its leadership, its priorities, its processes, even its culture. These changes result in a new paradigm for the company's goals, its customers' expectations, and its trajectory for the future. The force behind this shift is the state of today's consumer marketplace, which can be characterized as the age of the customer.

Think back to the brand revolution of the 1950s, when the advent of national television broadcasting created coast-to-coast demand and brand recognition. The companies that had the vision and resources to seize the opportunity and take their brands nationwide were the clear winners. Brands like Tide and Chevrolet became household names across the country, triumphing over smaller companies that faded away in their wake during the age of the brand.

The channel revolution was symbolic of the 1990s and early 2000s. It exploded when online marketers like Amazon and eBay changed the meaning of “going shopping” by making Internet purchasing commonplace. And GEICO, a proven insurance industry innovator, managed to shift the buying norm by introducing consumers to a whole new way to shop for insurance. Today, 13.1 percent of Americans are considered digital natives,1 having never known a time when the world was not at their fingertips. The result of this way of life is an unfathomable amount of data that can either overwhelm marketers or help them increase their customer knowledge and drive strong relationships.

During the age of the channel, marketers like Capital One and GEICO pioneered the use of individual-level data and analytics to target and personalize direct marketing efforts that drove new customer acquisition and strengthened customer relationships. The innovative application of analytics on valuable first-party data (owned customer information) and third-party data (acquired from data providers) within direct mail and telemarketing (the addressable media of the day) resulted in massive scale and efficiencies. These one-to-one trailblazers recognized the market opportunity of the moment, and like Tide and Chevrolet before them, they capitalized on it. They used a strategy of addressability at scale to gain enormous market share in highly competitive markets.

Today, we're facing another moment-in-time opportunity to harness the power of addressability at scale. Simply defined, this refers to the application of data and analytics to drive highly efficient, individual-level targeting and personalized experiences to consumers—and doing it at massive scale. It is now the age of the customer, where consumers are empowered with the tools to make their own purchase decisions—and they know how to use them. The gateway to competitive dominance lies in the addressable audience platforms that are being created for the “always-on consumer,” who engages with brands through digital media and channels, across multiple screens and platforms, 24/7. Leading third-party providers are scaling their platforms to deliver the experiences consumers seek, while creating an addressable marketing stage for advertisers. Some of these are household names, such as AOL, Facebook, and Twitter, providing tools for advertisers to reach their logged-in users. Others, like Rubicon Project and AppNexus, are little known technology players that are leveraging their place in the ad delivery ecosystem to create addressable experiences across an open web of thousands of publishers. The competition for advertising dollars among the major platform players is driving increased targeting, tracking, and content capabilities that continually enhance the opportunity for the marketer to implement addressable consumer experiences.

The opportunity for efficiency and scale within the addressable audience platforms dwarfs that of the aforementioned offline direct marketing opportunity of the channel age. In our opinion, it is poised to generate many times the value for those companies willing to take first-mover advantage. Further, due to the increased complexity of leveraging data and analytics in today's digital world, addressability at scale will create more enduring competitive power for those leaders.

Creating Competitive Advantage Through the Digital Audience Platforms

The opportunity for brands to create competitive advantage rests squarely on their ability to achieve addressability at scale. Addressability at scale is enabled through the application of data and analytics to the digital audience platform marketplace that is now at massive scale. And CRM is all about using addressability to increase the targetability, relevance, and measurement of marketing impressions and experiences across the customer lifecycle, in all channels and media, both online and offline.

Consumers are changing every day in the ways they interact with brands—shifting their media consumption patterns and decision processes. We have observed three prominent macro trends emerging from these changing behaviors, which are driving the market toward more individualized interactions. The first is the scaling of digital media; the second is the proliferation and penetration of social media; and the third is the multiscreen, always-on mobile population. We will delve more deeply into these trends in Chapter 4, but it's important to note that, as they continue to increase in scale, so will our capacity for addressability—and our commitment to customer centricity and individualized digital experiences across media and channels.

Over the time period of 2010 to 2014, we've seen a marked downward shift in the consumption of traditional media such as radio and print; at the same time, consumers have drastically increased the number of hours spent on digital media, social in particular, with an increase from about 52 minutes a day to nearly 90.2 In 2010 Google didn't have a social media capability, and today, 540 million people have accounts on Google+.3 Pinterest is a 300-person company, and one in every four women in the United States is using it on a weekly basis…incredible.4

Mobile is scaling, too. Today, we've hit an inflection point, where mobile Internet use is actually eclipsing desktop use.5 Who would have thought that would happen so fast? So the shift is on from traditional media to new media. And marketers are trying to leverage the use of data to figure out to whom—and how—they should offer individualized digital experiences. Advertisers in particular are shifting their dollars into this effort. In response to massive consumer migration to digital, brands are scaling their mobile and social media advertising budgets across formats such as native and video.

All of this digital interaction is creating a tremendous amount of data. Each day, 182 billion emails are sent.6 Each month, 70 billion pieces of content are shared on Facebook.7 As Google Executive Chairman Eric Schmidt observed, “There were five exabytes (5 million terabytes) of information created from the dawn of civilization to 2003, but that much information is now created every two days, and the pace is increasing.” For one of our top clients, we manage a single database that contains over 8 billion page views and more than 24 terabytes of data for a single brand.

The exhaust coming from all of this digital movement is data. Lots of it. And it's scaling quickly.

To consider addressability in the context of this much data is overwhelming. It simply can't be achieved through traditional methods. Not only is the overall digital media marketplace going to be $61 billion by 2017,8 but a significant portion of digital media today is, in fact, being bought programmatically, meaning through an automated approach that uses technology to select audiences based on data and analytic insights. Real-time bidding on media is actually going to reach $10.5 billion by 2017,9 growing more than 50 percent. And we estimate custom audiences, or “identified addressability,” to reach the $8 billion mark by that time. So the shift is toward digital but to the individual addressability opportunity within digital as well. As marketers, we're trying to build strategies for first-party and third-party data to aggregate that information so that we can apply analytics to it and deploy on this abundance of digital platforms. Brands—and the marketers charged with driving their growth—cannot keep up with this pace without continually upskilling themselves to capitalize on the massive opportunity. You will make swift progress or you will fall by the wayside while other companies—and other marketing executives with them—pass you by.

The power of addressability to create competitive advantage, both for the organization and for the marketer, has been proven by history. To set up some context, it is meaningful to consider its roots, which are surprisingly deep. We observe, in general, two distinct eras of addressability at scale (see Figure 1.1). Each possesses three common criteria of scale and effectiveness to drive superior performance. The first is individual-level addressability, which goes beyond broad segments, demographics, or panel-level data to reach individuals directly. The second is that the addressable platforms must have massive reach. And third, you must be able to deliver via immersive formats; meaning media and channels that are accessible by the general population. We have found that marketers who tap into the opportunity presented by these three factors have outpaced market growth rates by two to three times and have enjoyed competitive advantage for a sustained period.


Figure 1.1 Drivers of Scale and Effectiveness

With “addressability at scale 1.0,” the individual-level addressability factors were limited mostly to name and address—and later phone number. The primary addressable platform at scale was the United States Postal Service (USPS), whose reach was basically 100 percent of the nation's households. The direct mail format allowed for the use of imagery and long-form content in a manner that was highly immersive. There were many different engagement tools that could be delivered on the platform, from direct mail to catalogs. The USPS and third-party providers offered solutions and standards that helped us optimize on the platform, like National Change of Address (NCOA), Delivery Sequence File (DSF), and numerous proprietary tools. Companies figured out how to take both first- and third-party data, deploy analytics to that data, and leverage it using those tools. We became (or hired) experts who lived and breathed the nuances of the USPS platform. We used a framework to help brands create competitive differentiation. For all practical purposes, this was the start of addressability at scale. We helped our clients figure out how to segment their customers and create experiences for them using addressability. We helped them optimize the performance of their marketing programs through accurate measurement. We built technology structures to implement those programs. And effectively, we helped them organize their businesses around the opportunity of addressability at scale.

Companies like Capital One, GEICO, and DirecTV were actually executing addressable strategies, just with a different framework than today's. The winners made marketing advancements like we had never seen before. Capital One, for example, had hundreds of people associated with its database marketing and addressability at scale functions. The company emerged as a clear market leader during the time period of 1995 to 2005 because of its strength in leveraging the USPS platform at scale.

If we look at the big picture, addressability at scale 2.0 has many parallels to 1.0, except they exist in an increasingly digital realm. We still have individual-level addressability; it has just expanded into new forms. Now we're dealing not only with name, address, and phone, but with cookies, mobile device IDs, and social IDs. We have seen the digital audience platforms scale to massive reach with immersive formats in site, search, display, and social media, with new channels such as addressable TV emerging. They are providing us with countless different toolsets and targeting products that we can use to optimize on their platforms. Google alone has given us an integrated addressable platform, inclusive of its own ad network, exchange, server, and, of course, search platform, that delivers addressable experiences across devices and formats, such as YouTube. For Facebook, targeting products include the Facebook Exchange (FBX) and Custom Audiences, which can be optimized through a number of certified third-party partner toolsets. For Twitter, it's products like tailored audiences, keyword targeting, and TV conversation targeting, in which audiences can be purchased directly or through third-party partner toolsets. Numerous unexpected players, including Amazon, eBay, and even Walmart, are following close behind with their own similar offerings. And these behemoth audience platforms have spawned a massive ecosystem of advertising technology, or “ad tech” companies to supply data, targeting, and measurement tools intended to support or enhance addressability. One need only glance at a LUMAscape10 infographic to imagine the number and complexity of these tools. There are literally thousands of companies that are developing technologies to help us optimize on these platforms.

So, the crucial question is: who is going to take advantage of addressability at scale in 2.0? The opportunity is there, but most of the market is constrained in its ability to scale its addressable spend to make a significant impact. Our belief is that there will be noteworthy winners and losers. Most marketers who are moving their brand spend into more direct, measurable media tools, such as programmatic, performance-based, and direct response, are still working through the traditional marketing funnel. That funnel is narrow, with awareness at the top and little to no addressability. They end up spending marketing resources to contact people they don't know. And often, adverse selection is a problem, where people who don't have a high value potential are the ones cascading down the funnel. This, in turn, presents a targeting dilemma: a small audience of people who can ultimately be converted, wasted remarketing dollars, and a generally less valuable client base. It's only at the bottom of the funnel, after the restricted universe of converted customers comes out, that marketers can have insights about the outcomes of their marketing tactics. The result is a very inefficient funnel that's simply not scalable—all because you started out with no addressability at the top.

Historically, even in the most direct-response-focused industries, budgets have been heavily concentrated on the upper and lower parts of the funnel. One insurance advertiser we know spends more than $700 million in media, with more than 70 percent of that budget going into top-of-funnel tactics, such as television, print, sponsorships, and guaranteed display. This advertiser also spends more than $200 million a year at the very bottom of the funnel on things like branded search, aggregators, ecommerce, and call center experience. All told, this advertiser spends less than 15 percent of its combined consumer budget in the mid-funnel, where consumers actually consider, engage with, and decide which products they will buy from which brand. We call this the “cinched belt” phenomenon. Spend is fat at the top and bottom but cinched tight in the middle. The reason for this has not been a lack of desire to spend more in this area. This insurance marketer would love to find a way to productively spend another $100 million in the mid-funnel.

Until recently, lack of addressability has been the primary constraint to spending in the mid-funnel. Once broad awareness and share of voice were established, little could be done to engage with individual consumers as they moved through consideration and into decision. Direct mail was used to target individuals whom we believed were in-market, but that medium is now in decline. Email and display were used to relentlessly and impersonally retarget with diminishing returns. Once these tactics were maxed out, marketers were out of ideas for how to stay engaged with consumers through the buying process. So they saved their dollars to really unload on the consumer once they typed the brand name into Google or appeared on the site.

Enter the addressable consumer experience. Now the advertiser can take advantage of increased addressability to drive more targeted, timely interactions with the consumer through the key moments of the cycle. A single consumer can be engaged with an individually targeted message in the Facebook newsfeed, receive a personalized offer on the landing page, get remarketed with a relevant search ad, and receive follow-up via an outbound call—all with a singular brand voice and highly engaging content throughout.

Essentially, we can widen the funnel and place addressability at scale at the top by using data and analytics to target and maximize spend against high-value customers and prospects from the outset. First- and third-party audience platforms are enabling not just targeting but delivery of immersive, highly branded content, such as native and video, across devices. This means the traditional separation between right-brain and left-brain thinking around brand versus performance falls away, leaving a more powerful, integrated approach. And there is a cascading effect all the way down the funnel.

Advertisers now have the opportunity to expand the boundaries of the mid-funnel. In effect, if one equates the mid-funnel with the space between mass media awareness and the ecommerce transaction, the marketer's definition of the mid-funnel must expand dramatically, eating into the traditional boundaries of the upper and lower portions of the funnel.

At the upper end, fewer dollars will be allocated to untargeted messaging through things like national television, and more dollars will be allocated into addressable, programmatic tactics meant to drive consideration through relevance, such as addressable TV and programmatic video. At the bottom end, things like A/B testing and offer optimization will get pulled up into the mid-funnel as tactics integrated into the rest of the addressable experience. In essence, addressable and accountable spending has won most of the budget, which is what most advertisers have been seeking. That insurance marketer can now let that belt out several notches, and overall return on ad spend has increased.

This shift will drive greater returns but will require some fundamental changes to both organizations and external supply chains. The expansion of the mid-funnel boundaries requires re-organization of internal functions for most marketers. “Brand” functions that own domain over certain media like display and social from direct marketing organizations no longer make sense. Organization around media (having separate owners for search, email and display) should be questioned.

Similarly, external marketing supply chains with disconnected components where multiple tech platforms and agencies attempt to deliver the integrated mid-funnel in silos will create complexity and insurmountable barriers to the addressable experience. Consolidating the supply chain to fewer, more vertically integrated suppliers and platforms will become the norm.

The knowledge and insights gained as the audience travels through the funnel extends down into the channel, creating a larger universe of people who can now be brought into the funnel and are more likely to convert (Figure 1.2). This ultimately reduces the targeting dilemma, and this is how we scale. The result is more productive customer marketing, characterized by greater conversion rates. More knowledge means more targeted remarketing efforts. More efficient targeting, greater conversion, and more effective remarketing; they all lead to a richer customer portfolio.

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Figure 1.2 The Evolving Marketing Funnel

Our experience has proven this—in a big way—time and time again. Our clients have been able to increase their addressable impressions by more than 400 percent. In many cases, they have increased their addressable media spend by over 300 percent. Cost of leads and cost of conversions have decreased by as much as 30 and 40 percent, respectively. We have seen remarketing pools increase more than 500 percent. Average lifetime value of acquired customers has increased by more than 60 percent. And these results aren't atypical. They are commonly seen among our clients who take this opportunity seriously. Imagine the competitive advantage over those brands that don't.

The Mechanics of Addressability at Scale

Digital Addressability

Digital addressability involves the use of customer data, whether it is anonymous or identified. Figure 1.3 depicts the addressability spectrum, in which anonymous individuals move to partially identified and identified status over time, as the customer relationship expands and data is being collected. And as both the level of knowledge and the level of identification increase, so does the value of the customer.


Figure 1.3 Addressability Spectrum

Ultimately, the objective is to drive as much content as possible to that most valuable quadrant, where you have as much information on an identified customer as possible. But even in the far right lower quadrant, you will see that, as long as you have individual-level data, you can still drive a lot of value from anonymous consumers.