Customer acquisition on social media — with your own data

At a time when the use of third-party data is under increased scrutiny, contributor Brian Handly touts the benefits of using your own.

In the battle for customer acquisition, data plays an important role in marketing strategy, along with a desired product and excellent creative. There’s also the challenge of reaching a target audience where they spend most of their time, which today is within mobile apps and browsing social media.

When we look at Google, Facebook and Amazon from the perspective of an advertiser, we see that they utilize much more data for their own benefit than they make available for audience segmentation.

Amazon’s data has always been a walled garden. Their incredibly deep historical data on buying behaviors and patterns gives them a sizable advantage, leading to what many argue are cutthroat product decisions and incredibly targeted product recommendations.

I expect Facebook will increasingly become a walled garden after overexposing and ineffectively monitoring third-party data use. By shutting down their Partner Categories program, they’re reinforcing to their advertisers that Facebook audience data is the primary source for campaign segmentation.

How to cope in such an environment?

While numerous data sources are available for targeting across most digital properties, one of the most effective ways brands can target is by bringing their existing opted-in datasets to social media. This frequently provides a competitive advantage over the “walled gardens” of the major technology players, as your own data is typically much more relevant to your marketing efforts.

The four major sites — Facebook, Instagram, Twitter and Snapchat — all provide advertisers the ability to create custom audiences using their own data, and in some cases to use third-party data sets.

The workflow is similar across all sites:

1. Prepare your data.
2. Upload it.
3. The social media sites hash and de-identify the data.
4. Your data is then matched to the social media site’s user base.
5. Your custom audience is created.
6. And your original data file is deleted.

Typically, the most utilized datasets to match against are email addresses, identifiers/tags provided by the social media sites themselves and mobile advertising IDs. Most sites require a minimum of 1,000 records in order to create a custom audience. This is for privacy reasons (to ensure data is aggregated and no individual could be identified), and to ensure that the segment is large enough to deliver appropriately.

The perks of using your own data

The ability to create custom audiences on social media allows advertisers to reframe many of their existing marketing tactics. They can encourage repeat visits, whether in-store or online, from existing customers, or try to win shoppers from competitive locations.

Brands without physical locations that seek to go directly to the consumer can use custom audiences to reach their market on social media as well. Most sites also allow advertisers to create “lookalike” audiences to help increase the scale of the campaign. They look for common characteristics from the audience you’ve uploaded and find similar consumers for your campaign to reach.

One final example of how you can use your own data is to drive mobile app acquisition. Building a custom audience from existing customers creates a segment with a much higher propensity to download and use a mobile app, especially when paired with appropriate incentives.

A key component of such strategies has always been, and will continue to be, ensuring that the datasets you’re using have opted in to marketing communication and advertising. Expect to see more transparency required on behalf of the end user, especially as the General Data Protection Regulation (GDPR) goes into effect next month.

Aside from being able to reach a relevant audience, bringing your own data to a social media site can also result in performance improvements and cost savings. The cost savings stem from being more relevant — in Facebook parlance, this is having a higher relevance score — which can result in lower cost-per-click fees because you can potentially win the auction for a given impression at a lower price.

Brands, advertisers and the agencies they work with have been hungry for the right data to help them reach the holy trinity of right time, right place, right person. Using their own opted-in data sets will become an increasingly important tactic for the marketer’s overall customer acquisition strategy to achieve that goal.

Opinions expressed in this article are those of the guest author and not necessarily Marketing Land. Staff authors are listed here.