Madtech Convergence is Not Dying. It’s Back with a Vengeance

Patrick Tripp, VP of Product at RedPoint Global explains how power has shifted from brands to consumers and how the convergence of martech and adtech is the solution in closing the gap between customer experience — and expectations

The convergence of marketing and advertising technology has been widely discussed as the promised solution for engaging consumers that work in tandem. Marketing technology (martech) developed capabilities around communicating directly with known customers and nurturing customer loyalty, while advertising technology (ad tech) developed capabilities around acquiring new customers based on high-level anonymous audience information. And most recently, skepticism around whether they will truly converge has abounded. In fact, there’s even been discussion about the dichotomy and dysfunction of the two, especially if you view them as wholly separate entities.

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The struggle is real, as the balance of power has shifted from brands to consumers, changing everything . The empowered consumer now wants contextually relevant experiences with brands, regardless of time, channel, or lifecycle stage. But we shall not forget the modern customer wants a consistent brand experience regardless of which channel or device they use. They neither know – nor, quite frankly, care – if martech and ad tech are separate silos inside the organization. All they know is that they’re seeing an advertisement for a company or receiving a marketing email from that same company.

So, if they don’t get the experience they want, the customer is more likely to switch to a competitor than ever before. This shift has resulted in changes to customer engagement strategies, with some questioning if martech and ad tech will truly converge, but they are only doubling down on their convergence in the marketplace.

Yes, the two together are alive and well.

What’s timely about “madtech” is how it enables the centralization of customer engagement and management. New tools have emerged to offer converged solutions that blend the anonymous audience acquisition capabilities of ad tech with the relationship-management functionality of martech into a single ecosystem that allows a central point of control for both. The convergence is real – and has ramifications in both spaces, including a new focus on identity resolution across the anonymous-to-known customer lifecycle, the development of new solutions, and an understanding that neither marketing nor advertising will ever be quite the same.

Can I see your ID?

Resolving customer identities across channels and devices is vital for providing contextually relevant interactions. If you can identify a customer across multiple devices or channels of engagement, then you’ll more effectively analyze, personalize, and deliver messaging.

Identity resolution has helped with harnessing customer context, which is similarly crucial for creating relevant customer experiences. A natural part of the madtech convergence, identity resolution uses the best of both to empower the organization with insight into the entire customer lifecycle. If a brand captures third party site behavior with a data management platform (DMP), madtech ensures that offers and experiences provided to the consumer on the brand’s own channels are contextual and relevant, resulting in higher conversions and ultimately greater customer lifetime value. Furthermore, becoming much more targeted in ads by recognizing a customer identity drives more effective acquisition results .

It’s a (Mad) Madtech World of Platforms and Hubs

One of the primary goals of madtech is unifying customer data to create a single, composite view of the customer. Both sets, martech and adtech, have had this goal but approach the problem from different starting points. Many cite the incompatibility of technologies as a major hurdle, which is why the madtech convergence hinges on unifying data effectively. But the proliferation of platforms and hubs have emerged to solve this issue and link the two approaches for a more powerful, centralized solution.

Marketers aiming to target customers at a broader scale have flocked to an emerging class of technology called a customer engagement hub (CEH). CEHs are open by nature and can serve as the connective tissue in the enterprise that maximizes martech and ad tech investments. They work with first-, second-, and third-party data, but with a primary emphasis on personally identifiable information (PII), even though they can handle anonymous data as well.

DMPs and similar systems are often sold as handling first-, second-, and third-party data for cross-device engagement. The reality is much narrower, with DMPs focused on device-level and anonymous information, while offering a viable option only in particular use cases like ad targeting and aggregating attributes around specific requests at the ID or cookie level. DMPs often require batch updates, which can take three to four days to complete, and use look-alike modeling tactics to acquire additional contacts that have similar attributes and characteristics. They’re also used predominately for ad tech, ensuring more targeted audiences can be pushed to demand side platforms (DSPs) for display and acquisition. If you want to reach “Starbucks lovers from California” for ad display targeting, then a DMP is a perfect fit.

Targeting known customers in online and offline channels might include email, direct mail, SMS, mobile apps, IoT, POS, or any channel imaginable. The speed that CEHs operate in tends to be a bit more fluid, which might include ingesting data and acting in seconds, minutes, or hours, at the speed of the customer. Along with comprehensive analytics capabilities, including building and training models, A/B testing, optimization, and machine learning, these hubs often feature an orchestration piece that focuses on ensuring that all touch points are aware of one another and working together in tandem.

There are a number of synergies between the two systems, which ensures the anonymous insights of DMPs can be shared (appropriate to privacy laws) with the direct engagement systems a CEH communicates with and vice versa. The ability to generate look-alikes from known profiles can be powerful, and it’s also possible – with a CEH – to bring digital insights from DMPs back to append to customer profiles for direct marketing campaigns.

From death do us part

The rise of madtech is an important milestone in customer engagement practices. Unifying marketing and advertising technologies into a coherent solution, or at least one where the solutions communicate effectively can improve customer engagement and produce the contextually relevant interactions that will provide the right message, to the right person, at the right time.