The internet continues to transform the way people shop and engage with brands. Consumers face a barrage of advertising every second they are online. For this reason, cutting through the noise and locating new customers is harder for brands to achieve than ever before.

Forrester calls this new era the "Age of the Customer", in which consumers are in control of their interactions with businesses. This power shift is the reason that advertising has to be targeted in a contextually relevant and engaging way, rather than a mass marketing approach of broadcasting generic messages to consumers.

The internet is going mobile

Last year, we passed the point where there were more searches on mobile than desktop. Forrester recently said that 2016 will be defined by empowered customers who expect to get anything they want immediately, in context on their mobile devices. They estimated that people pick up their mobile devices 150 to 200 times a day and this results in almost 30 billion mobile moments per day in the USA alone. It is these mobile moments, they say, that are the next battleground where companies will win, serve and retain their customers.

Our Digital Connections research supports this prediction, over half of connected consumers (55%) saying their mobile is valuable for researching all types of purchase and 48% regularly use their mobile to research products while out shopping in physical stores. Technology is changing consumer behaviour and brands need to adapt to their customers' shopping preferences, in terms of device type and channel, in real time to remain competitive.

Get to know your existing customers

Brands with ecommerce sites collect a wealth of data from visitors to their websites every day, but not many brands effectively analyse and use this data to inform their online advertising strategies. By listening to website traffic and using artificial intelligence to identify behavioural patterns they can learn about their existing customers, such as the typical online purchase journeys of customers with a high average order value.

Using machine learning and artificial intelligence marketers can identify patterns that they wouldn't otherwise be able to. Understanding customers' online behaviour allows marketers to adjust their websites to optimise user experience and improve conversion rates of their existing customers, but these insights can also be used to identify new customers. Using these behavioural insights to identify prospective customers is a far more effective way to acquire new customers than by using sociodemographic information. Brands, including Netflix, are using this type of behavioural data — rather than data points about age, geography and gender — to understand consumers’ interests.

Drive converters to your website not traffic

Once you have an understanding of your existing customers, you can use this information to identify new potential customers who have a high probability of converting when they are driven to your website. Acquiring a new customer is notoriously expensive - seven times more expensive than converting an existing customer - and this is mainly due to un-targeted campaigns than have low conversion rates.

Brands need to be more focused with their advertising campaigns, this was proven by our recent study that found 49% of consumers will reject a brand that sends too many or irrelevant ads. The survey also found that 62% of UK consumers are spending more money online than they did a year ago, and 81% say the internet makes it easy for them to find out about different brands. Consumers want to find new brands, but marketers that serve the wrong ads are damaging their relationships with prospective customers.

One of the problems brands face is that the majority of people (51%) said they think there's too much choice online, making it complicated and time-consuming to find what they want. As a result, 7 in 10 respondents feel loyalty to just a few brands online.

Marketers should take a more focused approach and use insights about their existing customers and plug them into a DMP which observes millions of online customers' online purchase journeys. By combining these data sources the DMP technology can identify similar online consumers that are likely to convert when presented with a specific brand's advertising. It can also tell the programmatic media buying technology, when and on what device to serve advertising to any given prospect customer to increase their likelihood of converting. As a result, less users will be targeted with ads but the conversion rate of those targeted will increase.

Work with the right metrics

Marketers have traditionally used CPM (cost per thousand impressions) to buy advertising – a blanket approach. Online advertising has evolved and while CPM drives traffic, it doesn't necessarily drive sales. With the pressure to measure and make ad budgets more accountable this metric is becoming less relevant. Performance metrics, such as cost per acquisition (CPA) where a fee is only paid when a new customer is acquired, are more effective measures and encourage a more targeted approach.

Engaging new customers

In this emerging omni-channel world, brands need to understand how existing customers engage with them, and use that insight to intelligently identify and connect with people just like them. The most important consideration is to adapt the language and approach to different channels and devices. That way you cut through the noise, and engage the customer with personalised messages which are contextually relevant.

Where consumers are, the device they are using and what else they are doing influence the kind of advertising that is most welcome and relevant. It sounds so simple, but so many companies fail to effectively utilise the data they have at their fingertips to understand and target their current and future customers online.

It's no longer a question of whether a brand wants to go down this route - today's consumers demand it.


By Dan Cohen, Regional Director, Tradedoubler


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