- New report examines what contextual marketing means and the challenges for marketers
- Contextual marketing is viewed as the next step in the evolution of digital marketing, but it presents challenges including privacy, messaging and adapting marketing processes
- Report cautions that companies must handle contextual information with care to maintain their customers’ trust
Digital technology offers marketers the ability to see where their customers are, what they are doing and what they plan to do next. But to win—and keep—the trust of their customers, companies must use this contextual information to offer products and services that are more valuable to customers, not more intrusive ads.
That is the conclusion of a new report from The Economist Intelligence Unit, sponsored by SAP. Beyond personalisation: The challenges of contextual marketing draws on interviews with marketing executives, experts and consultants. It examines what contextual marketing means and identifies the key organisational and strategic challenges.
Contextual marketing refers to the use of any information about an individual’s context—such as their location, activity or intention—by marketers. Some see it as the next step in the evolution of digital marketing after personalisation. Recent developments in digital technology mean more contextual information is available than ever before. Examples include search-engine marketing, location-based discounts and ads that react to the weather.
The use of contextual information presents a number of challenges. These include the ability of marketing departments to react quickly and effectively to contextual insights, as well as to tailor messaging to individuals’ current contexts. Most importantly, it presents a risk of being perceived as intrusive, so companies must ensure they are offering better products and services in return for using contextual information.
“It is vital that companies do not use contextual information in ways that make their customers feel like they are under surveillance,” says Pete Swabey, editor of the report. “Instead, they should use it as a listening tool that helps them offer more value to customers.”
About The Economist Intelligence Unit
The Economist Intelligence Unit is the world leader in global business intelligence. It is the business-to-business arm of The Economist Group, which publishes The Economist newspaper. The Economist Intelligence Unit helps executives make better decisions by providing timely, reliable and impartial analysis on worldwide market trends and business strategies. More information can be found at www.eiu.com or www.twitter.com/theeiu.
