Data-driven precision marketing is about to change the digital marketing sphere. And a two-billion online user base and soaring advertising budgets will drive adoption.
Nielsen's report, A Digital Giant Awakens, showed that investments in precision marketing are set to increase. Estimates showed that it would account from 14% of marketing budgets to about one-fifth of spends (19%) in the next twelve months.
In the next six months, the top three platforms where advertisers across the Asia Pacific region will be allocating their marketing spends are Facebook/Instagram (60%), Google/Youtube (43%) and mobile (42%).
Meanwhile, investments in advanced applications are gaining pace. This is particularly so for data-science/modeling (36%), high-quality third-party data (32%), and analytics to measure ROI (28%).
The report found that precision marketing offers advertisers three advantages: understanding consumers' purchase journeys, personalized communications, and consumer profiling. Better data quality, clear advertiser ROI, and further education will increase adoption.
"With advancements in technology and popularity of digital media there is tremendous headroom for growth in precision marketing across the Asia Pacific," said Ranjeet Laungani, managing director, Media, North Asia, Nielsen.
"Precision marketing is capable of driving marketing applications out of predictive analytics and forecasting results, and it is strongly recommended for advertisers to consider in their repertoire of new-age tools."
As a result, Data Management Platforms (DMPs) are about to play pivotal roles. These platforms will allow advertisers to implement precision marketing in their overall strategies. They manage and unify multiple streams of disparate consumer data and assist in consumer profiling and targeted messaging. These features also limit spends on media waste.
However, the market will also face challenges. One is for advertisers to show quick wins during the early stages of DMP engagement. Talent will be another struggle with Asia Pacific companies searching for those with data science and analytic prowess.
"Currently, the space is under-invested, however, broadening expert ecosystems, presence of higher quality datasets, and presenting more success stories will drive up confidence and adoption in the industry. The void in awareness and education can be filled by agencies, media owners, and advertisers by maintaining an eye on the long-term and short-term potential of precision marketing," added Laungani.