To Win Millennial Consumers, Follow the Digital Data Trail

Millennials will have $1.4 trillion of spending power in the United States by 2020. This would make them the single largest consumer segment. So exactly how can brands get Millennials to sit up and take notice? How do they get this notoriously "tough crowd" to engage with them?

The biggest advantage that marketers have when building marketing programs for this target audience is the huge trail of digital data they leave behind. When analyzed, the digital data trail can make answers available to just about every strategic question that marketers might have to help them conceptualize and run successful campaigns.

Staying on top of consumer behavior is possible with greater use of analytics technologies combined with critical decision-making. A good first step is figuring out which business problems are a priority, and where the data exists to analyze and strategize around those problems from a marketing perspective.

As most modern marketers will agree, the traditional AIDA (attention, interest, desire and action) model of marketing has become irrelevant in today's connected world. This may be even more true when dealing with the highly-connected, always online Millennial consumer.

Often, data analysis reveals that Millennials browse for a specific need and not a product. In addition, Millennials spend a lot of time searching for products online, but often make the final purchase offline. When analyzing their digital trail further, it is often true that they have a tendency to abandon their shopping carts at the time of check-out, which suggests a Millennial consumer is not willing to pay for shipping. As more marketers see the benefit of using data to make marketing decisions, their need for good quality data increases. Member data collected through loyalty programs or online panel data can all be very useful in generating actionable insights that lead to accurate decisions.

There is a huge difference between what this demographic begins browsing for online and ultimately ends up buying. What Millennials are looking for is a need. For example, let's take deodorants as an example. Millennials buying deodorants are often not thinking of deodorant as a personal hygiene product. Their need is to "look attractive to the opposite sex" — marketers that are able to identify this need early enough, and are able to engage their Millennial consumers with relevant content, stand to gain the most.

Analytics plays an essential role in making a brand relevant to a Millennial audience. By combining internal and external sources of data, marketers are able to segment consumers based on their needs, interests and affinities. This is critical in order to engage them with customized, relevant and personalized content.

There is plenty of research available to prove how important customization is to a generation that shrugs off a "one-size-fits-all" approach. Retailers cannot afford to overlook what this generation wants, especially when 79 percent of Millennial shoppers claim that customized offers can increase their willingness to make a purchase.

Digital data in combination with internal information like point-of-sale data, information in CRM databases, and customer support logs can provide powerful insight that can predict what that Millennial customer's most recent purchase was, what they may be interested in purchasing next, and where they are in the purchase decision funnel — the journey that the average customer commonly moves through from awareness of a brand to purchasing a brand's products or services.

Utilizing the decision funnel can reveal insights into brand perception to help senior management compare desired and actual perception for their brands. Mapping out the decision funnel will allow for multifaceted analysis giving organization the opportunity to make beneficial adjustments in strategy and messaging that can sustain a brand over time. 

Organizations excel at collecting huge volumes of data as part of their digital transformation strategies. Data sets hold promise for staying agile, refining and adapting their marketing and sales opportunities, and ultimately providing the best customer experience possible to Millennials and other consumer demographics. The data can include transactional information from each customer touchpoint, social mentions and other insights from publicly available channels to create a holistic view of the individual customer experience.

Yet companies need to employ strategies that make good on this impressive data collection. Marketers are under more pressure than ever to show ROI, and CMOs need to be more involved with their organizations analytical strategies. As a result, CMOs and leaders of IT and marketing alike are beginning to introduce machine learning and automation as the next evolution of the analytics field.

In order to achieve new levels of data analysis, CMOs at retail and consumer goods firms must focus their efforts on actually evaluating the vast amount of data now available to marketers through these new tools and sources for data. Because Millennials often interact with a brand on multiple channels and through multiple devices, analytics helps brands achieve a real-time understanding of the consumer and their needs. This snapshot will help marketers understand behavioral differences between channels and the various paths of purchase.

For retailers to stay relevant, attract Millennial buyers and influence their purchases, there is an urgent requirement to keep pace with technology and change. Apart from using data analytics, companies now need to deliver these experiences to the consumer faster and better. They need to establish a steady stream of interaction and dialogue that will help them stay in constant touch with the consumer – be it through queries, feedback, or other channels of interaction that today's Millennial consumer expects from brands they follow. They must make use of the insights they gain from analytics to maintain the 360-degree customer experience, from responding quickly to customer queries, generating the next personalized offer or creating an interaction with the Millennial buyer that fosters loyalty and awareness.

Again, the mantra is simple – start following the digital data trail and focus on being pre-emptive and proactive with Millennials, and your organization's value to this consumer segment will rise.

Venkat Viswanathan is co-founder and chairman of LatentView Analytics, a marketing technology and decision sciences company.