REACHING RELEVANT AUDIENCES MORE EFFECTIVELY THROUGH BEHAVIORAL TARGETING AND PERSONALIZATION

REACHING RELEVANT AUDIENCES MORE EFFECTIVELY THROUGH BEHAVIORAL TARGETING AND PERSONALIZATION

MILLENNIUM ALLIANCE

JUNE 2015

Greg Revelle Best Buy

Confidential – Best Buy use only. Do not copy, publish, or distribute. The material in this document is proprietary to Best Buy. 2

AGENDA

1.  INTRODUCTION + PERSONAL JOURNEY

2.  SHIFTING MINDSET FROM MORE DATA TO THE RIGHT DATA

3.  WHAT WE’VE LEARNED


I MOVED FROM FORT LAUDERDALE TO MINNEAPOLIS TO BECOME CMO OF BEST BUY… IN NOVEMBER…


FLORIDA GREG •  Married renter with kids and HH net worth of $25K - $50K •  Likely to purchase consumer electronics, likes to read and travel and subscribes to

magazines and enjoys sports, specifically fishing


MINNESOTA GREG •  Married home owner with HH net worth of $750k+; unknown if children in the household •  Likely to purchase consumer electronics, specifically home audio, early adopter (home

connections) DSLRs, and appliances; no known hobbies


TWO CENTRAL INGREDIENTS TO PERSONALIZATION

UNKNOWN WELL KNOWN

AN

ON

YM

OU

S

IDE

NT

IFIA

BLE

UNDERSTANDING

IDE

NT

IFIC

AT

ION


WE PURCHASED A NEW HOUSE AND NEEDED TO OUTFIT OUR NEW HOME…


IN EARLY APRIL I WASN’T QUITE IN THE MARKET…


SAMSUNG GALAXY 6 PRE-ORDER…


LOOKING AT SOME NEW DEALS…


RECEIVED BEHAVIORAL TRIGGERS AFTER BROWSING ON BBY.COM

Day

1

Day

3


RETARGETING ADS I SAW ONLINE AFTER LEAVING BBY.COM


ON APRIL 13TH I BOUGHT A REMOTE, RECEIVER, AND HIGH DEFINITION TELEVISION

Logitech Universal Remote High Definition TV Home Theater Receiver


WE SEND A CROSS SELL TO DRIVE ACCESSORIES IMMEDIATELY POST PURCHASE

Day

2


WE OFFER HELP TO GET YOU UP AND RUNNING

Day

3


THEN WE SEND CONTENT TO PROVIDE INSIGHT INTO HOW TO BUILD OUT THE EXPERIENCE

Day

14


AND NOW WE ARE TRYING TO SOLICIT ANOTHER SIGNAL


TO BRING PERSONALIZATION TO LIFE REQUIRES A CONSISTENT SEGMENTATION FRAMEWORK

PERSONA Long Term Interests

PURCHASE OCCASION Temporal Need State

PRODUCT PROPENSITY Near Term Likely to Purchase

•  Best Buy utilizes three levels of segmentation


CUSTOMER DATA SEGMENTATION

CUSTOMER

•  First / Last Name •  Physical Address •  Email •  Phone

ATHENA

KNOWN CUSTOMERS

ONLINE IN-STORE

LOYALTY PROGRAM

SERVICES

MOBILE 3RD PARTY

PERSONA Brand Target (Default)

Early Adopter (Latest Tech)

Deal Seeker (Price Sensitive)

Health and Fitness Guru

Parent with Young Kids

Entertainment Guru (Music and Movies)

Cooking Aficionado

Automotive Guru

Audiophile

Gamer

Digital Photography Enthusiast

Sports Watching Enthusiast

Fashion Aficionado

Travel Guru

PURCHASE OCCASION

Purchasing (Default - all else)

Upgrading

Buying a Gift

Moving

Having a Child

Newly Married

Newly Single

A Recent College Grad

A Recent Empty Nester

Newly Retired

A New Driver

Remodeling and Needs Renewing their Cell Phone Contract

Awaiting a New Product Release

Replacing Printer Ink

Celebrating a Birthday

PRODUCT PROPENSITY

Cross Category Deal (Default) TV + Home Theater Computers Tablets Cell Phones Camera Camcorder Audio Car Electronics + GPS Video Game Consoles Video Games Movies Music Health and Fitness Small Appliances Major Appliances Smart TVs Printers Gaming Consoles iPad DSLR Headphones GPS Car Electronics Car Audio Xbox One Games PS4 Games All other Games Refrigerator Washer/Dryer

SEGMENTATION FRAMEWORK


SOPHISTICATED INFRASTRUCTURE INVESTMENT POWERS BEST BUY’S PERSONALIZATION

CUSTOMER DATA

In addition to increasing content production we are investing in taxonomy and content management to ensure we have the right message at the right time.

Multiple data environments for analytics and modeling and a big data platform to enable real-time decisions and customer triggers.

CONTENT

Connect disparate systems to a centralized customer service and migrate legacy data. •  POS •  Loyalty •  Service contracts •  BestBuy.com •  Digital software •  Customer Care •  Best Buy Mobile

ANALYTICS


SHIFTING MINDSET FROM MORE DATA TO THE RIGHT DATA IN PAID MEDIA


CUSTOMER DATA SEGMENTATION

PURCHASE FUNNEL 3RD PARTY DATA 1ST PARTY DATA

People interested in computers

People considering buying a computer

Little to no 3rd party data is used for these objectives

Awareness/ Prospecting

Consideration

Intent

Purchase

Use/ Retention/

Love

Little to no 3rd party data is used for these objectives

People who need to replace their computer

People considering buying a computer

People considering a specific computer

People who purchase a computer and need accessories or services


WHEN WE ARE ABLE TO ACCURATELY IDENTIFY A PERSON, PERFORMANCE IMPROVES

100

155 190

356

537

People interested in CE but did not visit BBY.com

Ret

urn

on M

arke

ting

Inve

stm

ent

•  Good: Data we control is more accurate than what we can buy from others •  Bad: Scaling our 1st party data is expensive and takes time

People who have the same characteristics of BBY.com visitors

People who added an item to their cart but did not check out

People who are loyalty program members

People who viewed product details on BBY.com


BROADER IS BETTER FOR PROSPECTING, ESPECIALLY WHEN USING 3RD PARTY DATA

People who buy products on sale

•  Good: Hundreds of ways to target people via 3rd party data – can create large scale •  Bad: We are at the mercy of data providers to understand who we are targeting

100 106

143

217

People who shop for electronics online

People who are “super users” of any electronics

People who expressed an interest to buy a specific electronics product

Ret

urn

on M

arke

ting

Inve

stm

ent


OUR PRIORITY IS ALWAYS TO USE OUR DATA FOR PERSONALIZATION •  Good: Our own data is the least expensive to deploy and has the best return •  Bad: We didn’t get here overnight and there’s only so much scale we can drive with

our own data

0

5

10

15

20

25

30

Ret

urn

on M

arke

ting

Inve

stm

ent

High

Low

People interested in CE but did not visit BBY.com Size: 104MM

People who have the same characteristics of BBY.com visitors Size 45MM

People who visited BBY.com Size: 33MM


WHAT WE’VE LEARNED


WHAT WE'VE LEARNED

With many partners and technologies working together, process is critical.

Personalization isn’t just Marketing, recognize the interdependencies.

Structured segmentation beats total flexibility

Document process and build for scale, audit frequently to avoid surprises.

Integration and communication between Marketing Technology, .Com, CRM, IT, Retail and Media teams is required.

Streamline segment development to ensure efficiency and consistent customer experiences.


WHAT WE'VE LEARNED

Creative production multiplies with personalization, traditional review processes don’t scale.

The transition to personalization includes technical elements, but the most significant change is cultural.

Clearly define responsibilities and let results be the ultimate decision maker.

Utilize change management to smooth the process from centralized “push” messaging to crowd-sourced and automated communications.

REACHING RELEVANT AUDIENCES MORE EFFECTIVELY THROUGH BEHAVIORAL TARGETING AND PERSONALIZATION

Marketing

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