Digital marketers around the world are shifting their focus toward consumer intent and away from consumer demographics. Yet rapidly changing demographics is precisely one of the main reasons for the emergence of intent marketing. Millennials think, act, and shop differently from their elders, and digital marketers are learning to treat them differently than other generations. Technological advancements have enabled marketers to respond to the unique challenges posed by millennials. At the same time, new privacy laws—introduced in response to new technologies—have opened the door for intent marketing’s explosion.
Demographics, technology, and regulation: these are our top 3 trends shaping the world of intent marketing.
Trend #1 – Demographic Change
“Millennials” is a term loosely used to describe the cohort born in the 1980s and 1990s. Now aged 20-40, millennials have become impossible for marketers to ignore. It should come as no surprise to hear that millennials are more comfortable shopping online than their parents and grandparents. But more importantly, they are more comfortable conducting research online and are far less loyal to any one brand.
Let’s look at the mortgage lending industry. Velocify studied millennials and baby boomers, and found that millennials are 45% more likely to find their lender online, while boomers are 87% more likely to stick with their existing bank or lender. Millennials now make up 36% of home buyers, according to the National Association of Realtors. As a result of their growing presence in the general population, borrowers are now 3.7 times more likely to find their lender through online research or social media than 5 to 10 years ago.
Data compiled by Natural Intelligence using Google Trends support these findings. Between 2010 and 2018, there was a 62% decrease in volume for high brand-consideration keywords like “Wells Fargo mortgage” and “Bank of America mortgage.” Over the same period, there was a 211% increase in searches for high-intent, unbranded searches such as “best mortgage lenders” and “best home lenders.” Natural Intelligence has also found that companies that display interest rates and APRs generate more qualified leads than companies that hide this information.
The lesson is simple: in order to win over millennials, brands must cater to customers based on what they want and not who they are. Gone are the days of being able to haul in an entire generation of customers with one ad campaign and rely on their lifetime loyalty.
Trend #2 – Technological Advances
Intent marketing has arrived at a junction of increasing millennial consumer power and the emergence of big-data analytics. Intent marketing is not a new concept. It has been around since at least as far back as the inception of direct mail marketing, as iotec has noted. However, technological advances mean today’s marketers are able to identify intent on an unprecedented scale.
Moore’s law, based on an observation made by Intel co-founder Gordon Moore in 1965, says that computer processing power will double every 18 months to 2 years. This means computers can process roughly twice today what they could in 2017, and will be capable of processing twice in 2021 what they can today. Big-data analytics has risen on the back of these faster processing speeds, enabling marketers to observe consumer behavior in real time.
The latest step in this chain is machine learning, a branch of AI (artificial intelligence) in which systems learn from data to make decisions without human participation. Machine learning is enabling marketers to look past traditional demographic profiling to get a completely objective picture of consumer intent.
Thanks to data-driven analytics and machine learning, marketers can now target consumers with personalized ads, offers and notifications. Think of your Netflix or Amazon account. The more you watch content or purchase goods, the more information these brands collect about you and the more accurate their recommendations.
In the past, gaming brands would target young males, while kids’ clothing brands would target married couples. In doing so, they would miss out on all the people who didn’t fit the stereotype, like “Gaming Grandma” Shirley Curry or a twenty-something bachelor looking for baby clothes for a newborn niece.
Thanks to advancing technology, marketers can keep targeting people in their primary demographic—while also acquiring new customers outside of it.
Trend #3 – New Privacy Regulations
Although intent marketing has been around for many years, the introduction of new internet-privacy regulations has reinforced its need. The European Union’s General Data Protection Regulation, or GDPR, came into effect in May 2018. Aside from causing our inboxes to be bombarded by hundreds of companies notifying us of changes to their privacy policies, GDPR is having a significant impact on how brands can target consumers.
GDPR is designed to protect “any information concerning an identified or identifiable natural person,” but allows companies to collect “anonymous information” that signals a user’s intent without identifying them. Businesses may not exploit IP addresses or cookies to identify a customer by name or address, but there’s nothing stopping them from using data-driven technology to identify what a person wants.
By regulating how companies may collect user data, GDPR will hasten the shift toward intent marketing. This, along with the ePrivacy Regulation being worked on by European legislators, has consequences for American companies operating globally. But even companies that do business solely in the 50 states and DC should read up on it, given the possibility of Washington one day following Brussels’ example.
Recent Pew surveys have found that more than 90% of Americans believe people have lost control over how their personal information is collected and used, and roughly half of Americans don’t trust how the federal government or social media sites protect their data. The next Facebook-Cambridge Analytica-type scandal is only a matter of time, and when it happens it will likely lead to increased calls for GDPR-style privacy regulations in the US.
If and when that happens, it will be another nail in the coffin for demographics-focused marketing and another reason to embrace intent marketing.
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