The Bottom Line: Turn Your Data Into Dollars
It's tough out there. Marketing budgets are limited and people are constantly pushed to do more with less. One of the creative ways to find a little breathing room is to make sure you are monetizing two valuable data assets: your email list and website traffic. Businesses are beginning to recognize that the insights locked in non personally-identifiable online data reflecting personal usage, location, profile and activity have a tangible market value. Monetizing this can generate a significant amount of revenue a year, which can either go directly to your bottom line or be used to fund marketing initiatives.
This concept of monetizing data through third parties isn't new. For decades, companies have provided data about their customers to third parties who have a desire to communicate with that same audience. Take the example of an expectant mother that signs up for a baby registry. Before long, she is receiving direct mail advertising diapers from Pampers or cradles from Sears. This also happens when you file a Change of Address with USPS. Shortly after moving, Home Depot and the local grocer will send coupons inviting you to check out their stores. This direct mail monetization is the same concept as email and site monetization, just with slightly different mechanics. However, Gartner predicts that only 30% of businesses will monetize by 2016.
Understanding what is possible and putting the relevant strategies in place is one way of building a competitive advantage.
Reaching your CRM email database with digital ads
Email is powerful in that it is one of the few ways online that a company can ensure it is having a sustained conversation with the same person over time. And one way to augment traditional email efforts is to connect your CRM database to a cookie profile.
Due to its persistence, marketers are willing to pay for the ability to connect a cookie to an email address. Implementation is straightforward and consumer privacy ensured -- no personally identifiable information like names, addresses, or emails are shared. The list owner includes new code in the emails they send. When the email is opened, this code places a cookie on the recipient's computer. An anonymous match is made between the cookie and the hashed email address.
This cookie can now be used to power display, social or video campaigns. As the email address is hashed (meaning encrypted) the match can be made in a way that protects the individual's privacy and email address. This is an easy, low-impact way to increase revenue that has no effect on the user experience of your site or email.
Making the most of site traffic
There are two ways to use third parties to generate revenue from your site data: 1) Allowing them to serve ads directly on the site; and 2) Securely providing anonymous user data to other marketers.
Placing ads on a site is not new for content publishers, but it is for e-commerce companies. This is changing. Amazon, the leading e-commerce platform, demonstrates this change in showing ads linking offsite to other e-commerce companies. Ten years ago this was unheard of...today, it's commonplace. Most sites will not be able to convert 90%-95% of their users. By showing noncompetitive ads, you have the opportunity to make money on that user visit.
The level of monetization will vary with the characteristics of your visitors and the placement of your ads. Most sites see CPMs in the $2-$5 range but those with desirable audiences can drive 5 times that rate. Leading ad companies will provide you with granular controls that allow you to determine what your users will and will not see.
The second route is through passing non personally-identifiable data on the users that visit your site to a third party. This could be intent information (e.g., this user just did a search for football cleats) or be demographic in nature (e.g., we know this is a 35 year old female). Similar to the email implementation, this information is passed through the inclusion of new code on your website which places a cookie in the user's browser. Marketers can then use this information to show consumers relevant offers through other online channels while still protecting their privacy. The third parties that operate in this space will provide controls around who can and cannot buy your data.
In each of these areas, it makes sense to work with multiple providers as that will give the maximum monetization and negotiating leverage.
As you look at ways to further your business, your email list and website traffic are valuable assets that can be used to give you a leg up. The strategies outlined above can generate significant revenue that will either drive better bottom line results, or create ancillary funding for under-resourced initiatives.
Chris Smutny is VP of product at Sojern, a data-driven platform that partners with travel companies.