We Buy Joy: What Zero-Party Data Says About Customers

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In the new post-cookie landscape, zero-party data is becoming increasingly important for brand marketers. Below, we’ll look at some key zero-party data findings and some tips for launching your own zero-party data strategy.

A Zero-Sum Game: What Data Says About Consumer Spending

As consumers scrutinize their spending and look for value over brand awareness, brand equity and user experience are becoming more important to consumer choice.

“Spiraling inflation forced families to put discretionary purchases on hold and focus most of their spending on necessities,” Target CEO Brian Cornell stated recently. According to a 2023 PWC survey, 96 percent of global consumers have altered their spending habits to focus on value—necessities, and brands that offer the quality they seek in exchange for a fair price. 

Although half of the 9,128 consumers surveyed across 25 countries reported that they were very or extremely concerned about their personal finances—70 percent stated that they would be willing to pay more, despite their financial concerns, for products that aligned with their personal beliefs.

“More than 70 percent said that ‘to some or to a great extent’ they’re willing to pay more for food produced by local farmers and for goods made by a company known for ethical practices, such as supporting human rights or avoiding animal testing,” the report stated. 

That means as consumers shift spending to wholesale clubs and discount stores to conserve cash (per McKinsey), they are saving their pennies to buy brands or access experiences that have a perceived value that justifies a higher price—like a farm-to-table dinner or a high-end cosmetics. Despite its retro subtext, Estee Lauder’s famous “lipstick index” is still relevant. Lipstick and cosmetics sales – considered “affordable luxuries,” indicating mild consumer optimism, were up by over 40 percent in January as cosmetics shoppers embraced luxury brands. 

According to a new global consumer survey from Deloitte, 77 percent of consumers have splurged in the last month on—wait for it—joy: brands and experiences that, according to research, make them feel in control, comforted, or excited. 

Surveys also found that consumers are looking for that joy everywhere, showing a strong preference for omnichannel shopping that allows them to compare shopping experiences, product value and price and use those perceptions to deliver the best and most “frictionless” interactions with retailers. 

User experience is also high on consumers’ brand or retailer differentiators list. A recent McKinsey survey showed that even online, when click-to-purchase was relatively effortless, 56 percent of digital shoppers who were unhappy with shopping experiences noticed poor user experiences or design. That means consumers—whether in-store or online—are sensitive to customer experience fails through the entire shopping journey, from onboarding to checkout, and retailers can’t afford to alienate price-sensitive shoppers when choices are so abundant.

All of the above insights came from zero-party data; information consumers readily gave to research firms in surveys. From opt-in forms to surveys to content personalization decisions, when consumers share data willingly, marketers can gain insights that can provide direction for new, revenue-focused marketing strategies. 

TLDR: What It Means For Marketers

Brands or retailers that are capable of matching a consumer’s perception of value (“a combination of consumers ethical or social beliefs and their measurement of ‘value-for-money’) or meeting their criteria for delivering the kind of joy that justifies a splurge can drive sales, even in the shadow of inflation. That opens up new opportunities for marketers. The specifics of how these trends may impact your audience can be revealed through the use of zero-party data—information that is by nature regulatory compliant and offers deep, often irreproducible insights into customer preferences and motivations.

Three Quick-Start Strategies For Collecting Zero-Party Data

When composing your zero data strategy, make sure you direct your data collection efforts with a clear focus on the end goal: creating seamless content experiences that make your consumer want to share new data on a regular basis and feel rewarded for doing so. Here are some best practices tips:

Cross-channel integration: Combine data from multiple touchpoints, such as email, social media, and in-store interaction, through a single dashboard where it is possible to optimize your insights with additional data as it arrives in real-time. 

Progressive profiling: Gradually collect more detailed information from customers over time, using a variety of data collection tools that automate data flow. Ensure that audience profiles and data handling practices remain compliant with data privacy mandates and agile to accommodate new data cuts or granular insights.

Partnerships and collaborations: Integrate data from trusted partners but ensure that their data-handling practices support data clean rooms or other modern compliance practices. “Go to the source” to ensure data-management visibility with all shared data tools or insights when working with new partners.

Once you’ve developed a method for collecting zero-party data, you’ll need to ensure you’re using it in a way that delivers optimal value.

How To Unlock Zero-Party Data’s Value

Here are three powerful ways to use zero-party data once you’ve integrated it with your marketing strategy:

Amplify audience segment accuracy. With deeper insights into what consumers may think when they purchase, you can uncover hidden trends that can help you target content and campaigns more accurately. For example, if you know that Gen Z consumers are more likely to splurge on higher-priced brands based on their data and preferences, allowing for targeted marketing campaigns that drive higher engagement and conversions.

Make personalization granular. By utilizing zero-party data, marketers can create highly personalized campaigns that resonate with individual shoppers – in a not-creepy way. For example, knowledge of a customers’ purchasing history and their generation would allow you to target them with content featuring “You might also like” product mixes that reflect a trending cultural moment—like Coachella—while highlighting your product’s value in comparison with a “Get the Look” promotion.

Optimize predictive analytics. Zero-party data adds context to your existing predictive analytics findings. While ad tech and audience management tools are creating powerful results for brand marketers, there are always deeper stories within the numbers. Zero-party data can help you sift through insights based on aggregate consumer data to find granular insights that support better marketing strategies based on an insider view of customer behavior and trends.

As your marketing mix plan evolves, ensure that the customer’s preferences, values and needs are at the forefront of every strategy.

New Report: Marketers Use Social Commerce, Collaboration For Optimized Brand-Building

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A new report from Shopify suggests that brand marketers are turning to collaboration and social to optimize their resources and reach new audiences.

Social Commerce Takes The Wheel

For brand marketers, earned media is a powerful tool that stretches budgets, builds the brand, and delivers actionable audience insights that can’t really be found any other way. Social commerce combines much of the reach of earned media with the granular control of eCommerce. It allows brands, influencers, and retailers to collaborate and launch campaigns that let audiences discover new products, shop instantly and share their favorite content or streams with their social network. That makes social commerce a worthy partner for an earned media campaign and an e-commerce strategy. Social media can accelerate audience engagement, boosting sales performance, marketing and branding strategy for brand marketers and retailers. According to Shopify’s Commerce Trends 2023 Report, which quoted data from Statista, social commerce sales and brand spending on social media advertising strategy are surging in tandem.

The rise of social commerce in the world’s second-largest market, China, underscores this trend. 

“In the last 12 months, social commerce-based apps have taken a 10 percent market share away from traditional e-commerce platforms like Tmall in China,” stated Qunin founder Thomas Nixon, who spoke at the 2023 SXSW panel, Prepare for the Social Commerce Era and Look East!

It’s not just China seeing a shift towards social commerce. A 2022 report from Sprout Social revealed that 98 percent of all consumers planned to make a social commerce purchase that year. In addition, a recent report from FIS Global revealed that 78 percent of Gen Z predicted they would make a social commerce purchase in the next 12 months.

Collaboration Via Social Commerce Can Boost ROI

According to Shopify, brand collaboration through social commerce and other online channels represents a new wave of marketing innovation, allowing marketers to optimize their budgets by building their brand and generating sales simultaneously. In addition, according to a recent Sprout Social report, social media is now an essential product discovery tool for most consumers.

“The biggest opportunity flying under the radar is collaboration,” stated Alex Danco, Director of Blockchain and Systems Thinking for Shopify. “It’s the best way to have fan bases come into contact with new kinds of brands. Collaboration is truly the win-win way for brands to find new audiences in a way that doesn’t dilute your brand.”

Brands like Burberry and Roblox have launched campaigns integrating commerce and social media through a gaming platform. Other iconic global brands, like Jimmy Choo and Sailor Moon, continue to leverage the impact of social commerce to build brand experiences that shorten the sales funnel.

New Data: New Investment Pours Into Gaming As Measurement Solutions Evolve

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While global M&A activity slowed in 2022, VC still poured money into the gaming acquisitions as industry organizations addressed lingering concerns about in-game advertising and measurability.

2022 M&A Gaming Activity Surges 

For many VCs, gaming represents a safe haven amidst economic uncertainty, according to Kurt Ma, a corporate partner at Bryan Cave Leighton Paisner LLP. Because gaming success is primarily driven by user experience, Ma stated powerful gaming franchises tend to produce reliable profits as long as users get their money’s worth.

“Gaming is quite different from a traditional business because gaming studios, on the whole, don’t get distressed in the same way,” said Ma. “You stand or fall on the strength of what you put out, and that’s true whether you’re a big player like Microsoft or an individual writing brilliant code in your bedroom.”

In 2022 M&A investment rose to $38.1 billion in 2022, up from $33.4 billion in 2021.

The flurry in M&A activity reflects an emphasis on strategic investment growth among VCs seeking to consolidate competitive advantage as gaming audiences and marketplace values rise. 

Per a recent report by DDM, M&A activity made 2022 a historic year for games funding.

“The investment landscape in 2022 has been hindered by a crypto winter, macroeconomic headwinds, high-interest rates, inflation, and recession concerns,” the report reads. “Despite these challenges, our data shows that 2022 was still the second-best year in the video game industry for games funding, mainly driven by acquisitions as large gaming corporations acquire mature and established businesses.”

That drive towards consolidation will likely continue, some analysts suggest.

“Despite the short-term turbulence, the deal activity will remain strong,” according to a recent report by InvestGame. “There is potential for a few significant deals to occur in 2023, as the industry continues to consolidate, supported by strong investors’ interest and enough cash to pursue transformative deals.”

According to Pitchbook’s Launch Report: Gaming report, many of 2022’s deals focus on emergent tech and monetization.

“Although VC funding is evenly distributed between early- and late-stage VC, the content segment has proven to be the impetus for most late-stage funding,” the report states. “Early-stage funding is skewed toward emergent technologies, such as Web3 infrastructure and generative artificial intelligence (AI), in addition to gaming content.” In addition, the report reads, “deal value is also flowing to startups helping content, and intellectual property (IP) owners monetize gamers.”

As new money flows towards proven gaming properties and audience monetization, measurement and addressability is becoming a priority in the industry.

Measurement Stays Top Of Mind For Gaming and In-Game Advertisers

In July 2022, The IAB and IAB Tech Lab, in collaboration with the Media Rating Council (MRC), in releasing its Intrinsic In-Game (IIG) Measurement Guidelines to provide updated measurement guidelines for in-game ads. The goal was to support agencies, brands and gaming platforms as the marketplace evolves and how audiences interact with advertising changes. A lack of understanding about in-game ad metrics is hindering in-game advertising investment, according to Jack Koch, SVP, Research & Insights, IAB.

“Buyers want to make good quality buys that align with their brands and drive all the way through to purchase,” said Koch in a press statement. “And while that is absolutely possible in gaming today, perception lags reality.”

Despite a global audience of more than three billion gamers, advertisers have yet to view game advertising as a platform for reaching a wide audience like they might look at social media, according to the IAB. A recent IAB-Mediascience survey of 40 brands, agencies, ad tech companies, game developers, and publishers revealed that gaming ads represented less than five percent of their marketing spend.

Report: Top Five Most Considered Brands Leverage In-Game Marketing

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YouGov’s most recent report covers CPG brands that are top of mind when consumers go shopping. We found that the top five food brands have accelerated in-game and gaming platform marketing in response to consumers’ brand loyalty coming up against inflation concerns.

Brands Matter—But So Do Consumers’ Budgets

There’s some good news for brands. Consumer loyalty is up slightly from 2021. According to Emarsys’ Annual Customer Loyalty Index, consumers stating that they are loyal to brands rose from 74 percent in 2021 to 79 percent in 2022. There’s some bad news as well: 60 percent of consumers report that inflation concerns have made them abandon brands that they were previously loyal to for cheaper alternatives. According to the survey, 58 percent of consumers state that discounts, incentives and rewards drive their loyalty, with just 42 percent stating that poor quality products and only 30 percent stating that poor shopping experiences would cause them to leave a favorite brand.

In fact, this may be an inflection moment for well-known name brands. A recent survey by IRI shows that inflation concerns may provide lesser-known “private” brands an opportunity to gain loyalty from consumers looking for bargains. It may also provide iconic brands with a pathway to solidify brand affinity by improving consumers’ perception of their value. The shares of consumers spending only with their favorite brands, on less-expensive “store brands,” or both are evenly distributed.

That means most consumers will still spend on the brand that offers them the kind of value they prioritize, regardless of the name on the label. Enter marketing and the new challenge brands, especially CPG food brands, face. 

The CPG Brand Challenge Amid Economic Concerns—And Who Is Winning

The 2023 FMCG report by YouGov ranks FMCG brands across 18 key international markets in terms of their level of consumer consideration: how readily consumers would choose a brand among others when deciding what to buy. The most competitive brands not only have the most to lose amid inflation as consumers hunt for bargains, but they also must avoid launching discounts that can negatively impact their bottom line when costs rise. Added to that is the pressure from stores that may resist rising prices for fear of alienating consumers.

“Supply chain slowdowns, in tandem with inflation-fueled cost increases, have further driven consumers to adapt their shopping behaviors,” the report reads. “Amidst these rising prices and product shortages, some people have started buying less, and some have switched from brands they typically buy.”

That adds pressure to the most popular consumer food brands to engage consumers with a new concept of value, not just offering discounts but reminding them of why they shop for their favorite brands in the first place. That’s marketing’s job, and we’ve found that each of America’s top five most considered brands in 2022 also amplified their efforts to engage consumers in new arenas, like gaming platforms.

Leading Brands Are Venturing Into Gaming To Connect With Loyal Consumers

Kraft, Hershey, Frito-Lay, M&M’s, as well as Campbell’s all launched marketing initiatives that appeared on gaming platforms or used mobile games as a platform to reach audiences within the past twelve months. 

Source: Campbells.com

“Launching a Chunky metaverse experience is another step forward for the brand to intersect sports and culture,” stated Marci Raible, Vice President, Integrated Marketing Campbell’s Meals & Beverages, in a press release. “As we leverage our 25-year NFL partnership, this activation allows Chunky to connect with the gaming audience and offer an innovative brand interaction.”

Kraft, in addition to other gaming-related promotions, created teams in Call of Duty and Overwatch in an effort to raise brand profiles in-game.

According to Statista, 65 percent of adults game, with over 3 billion gamers active globally for nearly six hours per week. Gen Z and millennials spend about 11 hours per week gaming, according to a Deloitte study. 

The Takeaway:

Reminding consumers of their connections to brands and why they’ve been loyal over the years may be hard in a 30-second ad, but perhaps easier when consumers are in lean-back mode, gaming or interacting with a branded gaming experience. While gaming holds only a 6 percent share of digital advertising spending, according to recent IAB data, brands are now turning to creative game marketing to recapture the imaginations of their audiences. 

Source: Research and Markets.

Data Clean Rooms: A Primer For Marketers

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From CES 2023 to Twitter, data clean rooms are big news and brand marketers may have a promising cookie alternative.

Cookies will be history by 2024, per Google. That may make new campaign ideation and audience segmentation challenging in the near future. Fortunately for marketers, data clean rooms may offer a safety net as they develop campaigns requiring deep insights drawn from first-party data.

“Unless there is a major change to how data is handled, less and less data will be available in the industry, particularly due the decline of the 3rd party cookie and device identifiers like IDFA,” the IAB Tech Lab wrote in a 2022 blog post. “ As a result, marketers will struggle to create personalized advertising, optimize campaigns, and attribute outcomes.”

The IAB believes that the demise of the cookie may have wide-reaching effects on consumers and publishers as well. “Consumers will receive less personalized and relevant ads, the post states. “Publishers may suffer decreased advertising income potentially forcing more subscription models and creating a move to a less open internet.”

According to Angela Eng, IAB VP of measurement, addressability & data center, this change has been a long time coming. 

“Over the last five years, we’ve moved in a direction where privacy regulations and consumer privacy require us to rethink the way the advertising ecosystem collects and uses data to target, measure, and optimize,” Eng stated. “Advertisers are looking for alternative solutions beyond the current third-party cookie and moving towards privacy-preserving solutions such as CDP, Clean Room, and CMPS.” 

How Data Clean Rooms Work

From social platform information to customer purchasing histories, a data clean room offers a secure environment where data can be analyzed and shared only with authorized individuals. Because all actions taken within the clean room are tracked and auditable, compliance issues can become less of a concern when campaigns and corresponding customer data inflows scale.

According to the IAB, a data clean room can be described as intermediary software that enables two parties to pool their data securely.

“Anonymisation is configured into the design: any personally identifiable information, such as email addresses, is encrypted, and access is only granted to those involved in a partnership,” reads a recent post from IAB Europe. 

“Data clean rooms are a secure, privacy-friendly way to help brands get a clearer and more detailed picture of their media performance, with insights that can help determine reach, frequency, and attribution metrics.“ 

The IAB described three types of clean rooms relevant for marketers in a recent post: 

  • Single-party centralized clean room: data from one party goes in and is analyzed in relation to other data sets.
  • Multi-party centralized clean room: data from multiple partners both inside and outside of an organization are aggregated 
  • Decentralized/agnostic clean room: data is connected in an independent, trusted environment. No one party has more privileges than another, and the data is not linked, thereby reducing the risk of data leakage

The IAB Tech Lab has stated that the use of a data clean room will likely be a central part of a future-focused data and privacy strategy for brands, marketers and publishers, but there is a caveat.

“Data clean rooms are not a silver bullet,” the post reads. “Ultimately, the data clean room is a piece of technology that cannot solve all privacy needs but rather works as part of a system of technologies and business needs.”

How Data Clean Rooms Can Support Marketers

For brand marketers, a data clean room offers several potential benefits when implemented with other appropriate Privacy Enhancing Technologies (PETs). One of the main advantages of a data clean room is the ability to gain a deeper understanding of first-party audience data by looking at contextual insights from multiple data sources in a General Data Protection Regulation (GDPR) or California Consumer Privacy Act (CCPA) compliant environment. 

Another advantage of a data clean room for brand marketers is the ability to collaborate with partners and third-party vendors, such as research firms or data analytics companies, without exposing sensitive data to potential breaches or misuse. 

Here are several ways brands, marketers, and publishers can leverage data clean rooms to support marketing or branding goals:

  • Audience segmentation: By analyzing customer data in a clean room, marketers can gain a deeper understanding of their target audiences, including demographics, behavior patterns and preferences. This can help marketers segment their audiences more effectively and tailor their messaging and campaigns to specific groups.
  • Performance analysis: A clean room can also be used to analyze past campaigns’ performance and identify improvement areas. For example, marketers can analyze data on website traffic, social media engagement and sales to understand which campaigns were most successful and which were not.
  • Predictive modeling: Clean room data can also be used to create predictive models that can help marketers identify future trends and opportunities. For example, by analyzing historical data on consumer behavior, marketers can build models that can predict which products or services will be in demand in the future and which segments of their audience are most likely to respond to certain types of messaging.
  • Fraud detection: A clean room’s multi-source data can be used to verify the accuracy of data collected from third-party sources, such as cookies or mobile device IDs. Marketers can also identify anomalies that may indicate fraudulent activity, such as bot traffic or click fraud. 

For Eng, navigating a cookie-less future, even using tools like data clean rooms, is highly dependent on marketers having access to the right data in the first place.

”Investing in deterministic first-party datasets (data from logged-in, “known” audiences) remains vital,” Eng stated.“ Yet, in most instances, this only represents about 20 percent of potential consumers. Marketers need proven, probabilistic solutions to target and measure the 80 percent of consumers who are not part of their first-party data.”

Could AI Be A Powerful Creative Tool For Brand Marketers?

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Can brand marketers leverage AI as a tool that amplifies rather than limits human creativity?

In a recent commercial for Mint Mobile, actor Ryan Reynolds uses a script written by the AI-powered platform’s ability to mimic his style of speech and delivery and notes that its accuracy is “mildly terrifying.” However, for some brand marketers, the debate over whether and how AI can support creative marketing is genuinely frightening. Since copywriters, content strategists and other creatives do what ChatGPT does—creating marketing copy and long-form content—there’s been significant debate about the prospect of AI diminishing the role and value of brand marketers and the creatives with whom they collaborate. But some analysts are looking at AI as an opportunity for brand marketers and creatives rather than a threat.

Is There A Role For Human-Led AI Creativity?

So why is ChatGPT so good? According to the Content Marketing Institute, the most recent release of the open-source AI technology that powers tools like ChatGPT—GPT-3—represents a sea-change in how well these platforms work.

“Each version has gotten progressively better at producing text that reads as if a real human wrote it,” the post states. “The release of GPT-3 resulted in an exponential jump in skill and accuracy as compared to GPT-2.”

ChatGPT, which generates content based on prompts, is one of many options that brands have for creating content ranging from original artwork to blog posts to scripts. According to an article by Harvard Business Review, the possibilities for marketers and brands are vast.

“[Generative AI models] can take in such content as images, longer text formats, emails, social media content, voice recordings, program code, and structured data,” the post reads. Once input is processed, AI platforms “can output new content, translations, answers to questions, sentiment analysis, summaries, and even videos.” 

While generative AI platforms have been used to create copy and even full-length movie scripts, there’s a significant caveat, according to a recent article by Harvard Business Review. “To use generative AI effectively, you still need human involvement at both the beginning and the end of the process. Once a model generates content, it will need to be evaluated and edited carefully by a human.”  The wooden, awkward sentences or the word-salad produced by early versions of auto-generated content tools can still happen with modern AI platforms. But there are also examples of powerful, human-like responses to prompts that can inspire consumers and challenge creatives to build powerful messaging around a specific theme.

When a columnist for The Atlantic entered a tricky challenge designed to test Chat GPT’s ability to respond to contradictory or irrational suggestions, they received the following reply:

The most sophisticated tools have limits—even with GPT-3. There’s no ”plug and play” with generative AI, and that means it should be seen more as a tool than a potential replacement for human creativity.

How Brands Marketers Are Using AI To Optimize Creative Talent

Nestle is one of the brands that has embraced AI as a tool to amplify human creativity. The company first used AI to improve its R&D and product development processes and is now using it as a tool for social listening.

“We established an artificial intelligence concept engine, which is transforming (social media) insights into concept proposals, which our employees then evaluate,” stated Stefan Palzer, chief technology officer.

The company has also used AI as a central actor in a recent AI campaign for La Laitière yogurt, in which Vermeer’s famous painting “ The Milkmaid” was expanded.

According to Ogilvy ECD David Raichman, brands and creatives warming to AI as a tool can allow agencies to streamline content creation.

“A.I. generated imagery is a revolution, and all the creative industry should embrace it,” Raichman says. “It will probably have us rethinking lots of jobs, but in a good way. Illustrators will be able to sketch roughs more quickly. Photographers or art directors will create mood boards more easily. We see A.I. as an amplifier of creativity. It democratizes the process. We just need to keep in mind that it should be used in a meaningful way and ensure that there are still creative people directing the A.I., and not the other way around.”

The technology behind AI-powered image generation is fairly straightforward. AI tools that feature text-to-image capabilities may use leverage a network called CLIP (short for “Contrastive Language-Image Pre-Training”) which classifies and then ranks input or generated visual information according to how likely it is to be classified under a given text prompt. That makes it easier for machine learning engines to present a more relevant representation of a concept, based on a text prompt. That ability to rank is limited by the datasets that a particular AI tool has access to and also by the limits of the technology itself. 

A recent campaign by Hardee’s designed to add humor to the conversation around AI resulted in several humorous results from a text-to-image generation exercise.

Source: Hardee’s

“With the spectre of AI hanging over us all, it was the perfect time to show not what it can do, but what it can’t. Each image Ai generated therefore became an eye-catching reminder (and proof) that Ai isn’t quite there yet,” stated Jamie Kennaway, Executive Creative Director for the campaign.

The takeaway? AI works best with human brilliance as a mitigating force.

The Takeaway For Marketers: What Can AI-Powered Creative Campaigns Really Do?

Here are just a few benefits for brand marketers:

  • Simplified creative personalization
    • As with Nestle, AI can deliver impactful creative prompts that leverage vast datasets to boost campaign originality. When creatives work with a powerful concept, their expertise can make the end result shine while using fewer human resources at the beginning of ideation.
  • Streamlined concept-to-product processes
    • The Hardee’s campaign highlighted AI as a humorous tool for new product development. But Nestle, as stated above, has integrated AI tools into their R&D and product development process, optimizing social media prompts to fast-track new product ideation.
  • Supporting content production at scale
    • While creative collaborations between humans and AI may always be controversial—some content creators are finding value in looking at AI as a tool rather than a competitor. Tools like Jasper.AI and ChatGPT are no substitute for content creators, but their prompts can speed up repetitive content creation tasks for teams with high output responsibilities, such as news organizations.

Case in point:

Learn more about ChatGPT.

The Burberry And Minecraft Partnership: High Fashion Is Taking The Metaverse Seriously

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When a 166-year-old iconic apparel and accessories brand enters the metaverse with a splash worthy of New York Fashion Week, it’s a signal that fashion may be shifting towards virtual commerce.

Burberry’s new in-game experience for Minecraft: Burberry: Freedom to Go Beyond, allows players to wander a mythical London populated with Burberry-themed characters and motifs. In-game players will have access to 15 free skins to download.

“As the player, you venture into an alternate reality version of London taken over by a malevolent entity called the Nexus,” according to Cristina Anderca writing for Minecraft.net. “Once a place blooming with foliage and gentle animals, this land has been drained of color and life. Its inhabitants have been scattered to the four realms of air, water, fire and earth, and your quest is to restore the spirit of the wild by traveling to each realm, reviving its Nature Guardian, and freeing the animals trapped there.”

This is the third collaboration between the fashion brand and a metaverse or gaming entity: the brand also offered virtual handbags on Roblox earlier this year. In 2021 and again this year, Burberry partnered with Mythical Games launch an NFT collection for its Blankos Block Party, the company’s flagship release. 

Burberry: Freedom to Go Beyond is also available in New York, Shenzhen, London, Tokyo, Seoul, Taiwan, and Bangkok in addition to online. There is also ESG goodwill involved in the launch. According to the press release, “Burberry and Minecraft will make a donation to help protect 500,000 trees and plant 25,000 trees through environmental organization Conservation International and their forest conservation efforts around the world.”

Burberry’s New Partnership With Minecraft Shows The Company Is Serious About Metaverse Commerce

The metaverse’s value to fashion companies like Burberry isn’t just about brand recognition. Consumers who interact with brands in virtual spaces are also providing valuable data to marketers and platforms about their content and entertainment preferences: the more time they spend connected, the easier it is for marketers to find out which types of content sparks their engagement.

According to Burberry’s director of channel innovation and marketing, Phillip Henneche—who spoke with Vogue Business—Burberry now sees gaming spaces as an important customer engagement channel.

“Gaming is a super important channel for us in terms of how we engage our customer,” Hennche says. “We know that it’s a very important passion point for our target markets and consumers. We know that they are there, they are present, and they’re very active in that community.”

But Burberry may also see gaming platforms as a way to open new revenue streams, not just engagement. According to estimates by Morgan Stanley, the market for virtual luxury goods may reach $50 billion by 2030. In-game sales also offer brands like Burberry a way to sell to high-intent consumers at scale without the expense of a physical storefront or having to dip into traditional ad spend. According to Bloomberg, with high margins and no need to discount or manage overstock, fashion brands can glean significant profits from virtual swag that consumers will snap up almost immediately. According to Forbes, Burberry quickly sold out its NFT collection for a cool $400k.

Watch the DLC trailer here.

Why Games Are The New Social Platform

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Gaming platforms are forcing an evolution across the social media landscape—and that’s good for brands.

How Gaming Platforms Are Raising The Bar For Social Media

Gaming is no longer just a pastime for kids, it’s a new form of social interactivity and a platform for content that is always evolving. But just how popular is gaming? According to a recent report, global consumers spend over 1 trillion hours playing games and an additional 25 billion hours watching gaming streams each year, meaning gaming hours outpace all of the time consumers spend on social media and/or watching television.

Gaming platforms are notorious for their side chatter—some of it controversial, some plain silly—but the noise masks a tidal shift in how consumers communicate about experiences with digital content. Consumers immersed in a world of engaging content are passionate and vocal about their experiences and are often eager to share what works and what doesn’t.

Consumers who discuss the games they’re playing in depth are a blessing for game producers. When games are great, every passionate player becomes a brand ambassador, inviting friends to play along and discuss live on platforms like Twitch while encouraging others to become superfans. In that sense, games are amplified social media—focusing a players’ attention and providing them, on platforms like Twitch, with a preloaded community that is ready to engage around experiences.

How Social Platforms And Brands Are Engaging Consumers With Gaming Content

“We have 2.5 million engaged viewers tuning into live content every single day. And so, at its core, it’s about interaction,” said Victor Lu, brand partnership studio lead, Americas at Twitch, while speaking at the recent IAB Audience Connect conference. “If you’re ever on Twitch, you’re not just watching the stream, you’re part of the experience—you’re chatting with people, you’re talking to the streamer, they’re talking back to you.”

That global shift toward deeper connections with others and with the content we love has also changed marketing. Demographic groups used to the immersive, engaging nature of games—like Gen Z—have high expectations for social media, marketing and retail experiences. For example, a recent survey by Snapchat revealed that 92 percent of Gen Z users want access to augmented reality tools while shopping, and over half pay more attention to ads with AR components. That means in-game advertising and platforms like Twitch offer significant opportunities for brand marketers to reach new, highly engaged audiences.

“So, 77 percent of Twitch viewers agree that the community that they build from gaming is just as important as the game itself,” Lu said. “And 65 percent actually would buy the game for the community that it surrounds versus just playing the game itself. And so it’s really about being together. And so what does this mean? Like, this is an audience, like, it’s all about community, it’s all about togetherness.”

But games are also doing something to the way consumers think about social media. Gaming content makes digital experiences center on interactions, so viewers’ attention is focused on the screen without interruption. That means gaming-focused social platforms have an audience that is already used to prolonged, intense connections with on-screen content, and their social media networks are already motivated to connect around gaming and the experiences they encounter on those platforms.

Brands Are Turning To Collaboration To Create Unique Ad Experiences

Brands are taking advantage of social gaming platforms in innovative ways. Rather than using traditional tools to reach these audiences, brands like Kellogg’s, which created an animated Tony the Tiger avatar in collaboration with Twitch, are reimagining native advertising as a social gaming experience.

“It’s the first time a brand [has] come to work with Twitch to transform a brand mascot into a VTuber.” Lu said. “It is really just quite amazing to see [Kellogg’s Tony the Tiger] live, talking to people, talking to streamers. It’s kind of incredible.”

Twitch is also collaborating with Adobe to develop not just a new type of advertising, but a new way to bring audiences deeper, immersive experiences with their content.

“So, to break that down, it’s a triple-A game that allows the fans to create an asset that would go into the game that they could then play for free as a result of the stream,” Lu said. “So it’s something that could really only happen on Twitch. And what was really fascinating was that we got 21,000 chat interactions out of it for the initial stream, and it showcases, really, how engaged the audience was.”

The Takeaway

Social gaming platforms like Twitch show how impactful games have been in the evolution of social media. Consumers want more visual, immersive and interactive elements in their ads, retail experiences, and social media. Brand marketers seeking to connect with this audience in the arena where they are the most engaged and attentive should look at gaming platforms as their first choice when developing creative campaigns.

Breaking Down The State Of Data With IAB’s Angelina Eng

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On the first day of this year’s IAB Audience Connect, we spoke with Angelina Eng, vice president, programmatic and data center, about the current state of data in marketing and the Interactive Advertising Bureau’s new report.

Carla Rover: How has the current “state of data” changed the way advertisers think about the audience, measurement and compliance?

Angelina Eng: Given the current “state of data,” our industry has to rethink our approaches to how we target consumers, deliver relevant ads and measure effectiveness with privacy-first solutions. The companies we interviewed all agreed that rebuilding consumer trust and communicating the consumer value exchange are top priorities.

CR: Please tell us some of the biggest compliance and data privacy issues facing advertisers.

AE: They are:

One: how to comply with five new privacy laws in the span of a year.

Two: When a consumer opts out of “sales,” that likely includes measurement and frequency capping. So even if you deliver an ad that does not involve the sale of personal information, there is still a challenge to measure it and frequency cap delivery.

Three: When a publisher or advertiser independently engages a measurement company or DSP as a service provider, it cannot measure, or frequency cap insofar as those activities require a combination of personal information, which is prohibited by the CPRA. The CPRA adds contract requirements for third-party, contractor and service provider agreements and will result in a major effort to amend contracts by Jan. 1.

Four: Certain parts of the digital adverting supply chain that involve the disclosure of personal information do not typically have governing contracts (e.g., pixels in the ad creative or disclosures from the advertiser’s ad server to the publisher’s ad server). Putting in place new contractual relationships will be a critical challenge.

Five: New state privacy laws include additional user controls over the use of personal information and sensitive personal information, which must be built into compliance plans.

CR: How has the advertising landscape evolved over the last five years with respect to the challenges facing advertisers?

AE: Over the last five years, we’ve moved in a direction where privacy regulations and consumer privacy require us to rethink the way the advertising ecosystem collects and uses data to target, measure and optimize. Advertisers are looking for alternative solutions beyond the current third-party cookie and moving towards privacy-preserving solutions such as CDP, Clean Room and CMPS. In addition, advertising needs to shift away from 1-to-1 personalization and measurement and embrace cohort-based solutions and probabilistic attribution.

CR: How are marketers and advertisers adjusting to the ever-changing digital landscape and new challenges around data?

AE: Advertisers are prioritizing rebuilding consumer trust and testing privacy-preserving technologies. They are currently evaluating various cookie-less targeting solutions, such as Identity, Cohort, and Contextual targeting. However, they realize that the way they measure performance will be difficult with ongoing legislative and platform changes. The fragmentation of state legislation is also making it difficult for advertisers to keep track of the regulations.

CR: What does the new State of Data report cover this year, and what are some topics that it delves into?

AE: First, investing in deterministic first-party datasets (data from logged-in, “known” audiences) remains vital. Yet, in most instances, this only represents about 20 percent of potential consumers. Marketers need proven, probabilistic solutions to target and measure the 80 percent of consumers who are not part of their first-party data.

In addition, creating consistent measures and protocols that work inside their companies and with external partners has become a major issue. In the face of rising complexity, the majority of respondents agree a “one size fits all” approach spanning multiple jurisdictions is probably necessary. But there is a significant trade-off: failing to leverage data that is fully permitted in certain states means lost opportunities.

Report: Data Privacy Practices Impact The Bottom Line

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A new report shows consumers are very much aware of data privacy issues and judge brands based on them. Ketch and Magna conducted a survey among 2,750 consumers across the US, 76 percent of which described themselves as the primary decision-makers for household purchases. 

According to the findings, 74 percent highly value data privacy and 83 percent say they understand the value in sharing data with brands under the right conditions, such as when they want to learn about new products.

Still, brands haven’t quite fully earned consumers’ trust. An overwhelming majority (82 percent) of consumers are highly concerned about how their data is collected and used, the report found, which is fueled by a lack of transparency and control. In addition, 57 percent worry that brands use their data beyond their intended purposes.

Brands have a lot to gain by remaining transparent with their data privacy practices. The survey shows that 49 percent of consumers would not only trust the company more but would also prefer it over others (43 perfect) if the brand was transparent and gave them control over their data usage.

Part of earning trust requires that brands allow consumers to decide how much and what kind of personal information to share with the brand. The report echoes this sentiment; most said that instead of cookie notices, they want personalized preference centers with clear and easy-to-understand privacy options they can manually set.

Data storage practices and data minimization have the greatest impact for consumers and trust translates to 23 percent higher purchase intent. To build trust, the data retention period matters the most for retail, travel and finance while data minimization matters the most for telephone companies. 

Key takeaways for marketers:

  • Control data across its lifecycle
  • Clearly communicate with people about how their data will be used
  • Allow people to change their privacy at any time
  • When people make a choice, ensure it’s reflected in all the data systems that store it and use their data as well as with downstream partners that receive it
  • Ensure legal, technology, marketing and data teams all have a say