Local markets are full of stories. They reveal the interdependence of people and events that shape the foundation of the citizens who reside in them and create the business, social and cultural nodes that make each place unique. For the marketing and advertising industry, it is time to reconsider the value of these rich experiences and their influence on both commerce and consumer sentiment. Digitization is finally offering an opportunity to collect and utilize this information through data but it will require collaboration across a broad mix of partners to drive the initiative to a successful outcome.
The transformation of media and marketing by technology has ignited a dependence on data surrogates, machine learning and automated solutions that manage complex, synchronized matches. And yet, despite the thousands of data points and associative algorithms that inform marketing and media decisions today, the more profound signals related to localized policy decisions and business initiatives across the country remain largely absent, under-represented or overlooked in these databases. To many this may seem insignificant, but local markets are experiencing an evolution that directly impacts prosperity and consumer attitudes as well as a wider frame for competitive challengers.
The localism movement, which can be loosely defined as the public utilization of local businesses, is gaining momentum across hundreds of metropolitan areas. Unlike the seventies and eighties when local communities pushed back to defend their heritage businesses against the encroachment of larger chains, today’s localist shift is a necessity tied to community decisions that focus on growth, prosperity and inclusion. Born out of the disruption created by years of national business expansion, and then followed by retraction and sometimes bankruptcy, these actions contributed heavily to local and regional economic instability. In turn it triggered a response to push sustainable growth and business prosperity back into self-directed initiatives.
Local revitalization is not a fad. In fact, it is the result of concentrated support from economic development professionals, academia and broader think tank projects that recommend locally directed initiatives to spur stronger economic results. The movement is important because it affects the context and wider lens of the local market influences that can undermine even the best marketing and media efforts.
Consider the consequences that have taken place over the last ten years. National chains, across several categories, have expanded their footprint and provided jobs to multiple local communities, but they have also crowded out smaller competitors in the process. After a few years, these same owners may have decided to move out due to corporate retraction, mergers or bankruptcy. The result is a loss of local jobs and a hollowed out commerce district that may offer no alternative choices.
Those reducing their footprint will argue that they provide alternative options for these customers or job seekers -- but the community may not have the means to consider these choices. The result is fewer customers for the former business and less commerce in the existing community. In an effort to combat the effects of higher vacancy rates, community leaders along with public and private investors now work to transform the space to accommodate locally directed entrepreneurs who may establish co-op markets, small businesses or other multiple use facilities to reignite the growth. These community forces have reached progressive levels in recent years by stimulating local markets and entrepreneurship activity, while remaining largely muted or undetected at the national level.
Individual market characteristics were once widely studied and analyzed by both agencies and marketers to insure brand relevance and local consumer acceptance. This attention has diminished in the last two decades as technology solutions compartmentalize data insights to support projectable sales. Media agencies and the overall media ecosystem have been working to demonstrate capabilities that address the relational value of media usage, data and technology but have deferred building in analytical data that adequately reflects individual local market dynamics. The lack of scalable sourcing as well as resources and knowledgeable local market analysts may be contributing to this position.
Bringing together disparate data so that it can be more useful to the public and private sectors will be the focus of both large and smaller investors in the next five years. Enterprise leaders like IBM’s smarter city initiative as well as smaller startups like Sidewalk Labs (working to bring fast Wi-Fi to every street in NYC) are already enabling city leaders to improve government efficiency and incremental revenue. All of these programs acknowledge the untapped value of local data, which is generally in a pioneer stage of development.
Recent research among data experts has shown that the number of different data sources is becoming more valuable than the size of an individual data portfolio. In their fourth annual Big Data Executive Survey of Fortune 1000 companies, New Vantage Partners found that the variety of data trumps the volume of data by a wide margin. The survey authors reveal that almost 70% of respondents value the inclusion of all forms of data as the most important factor in driving successful data-use outcomes and even refer to it as the next data frontier.
Business clarity has been more elusive in an evolving media and marketing ecosystem that consistently redefines itself through new tools, data access and modeling practices. Algorithms and robust data sets are enabling tighter targeting, but it is still lacking a dimensional view of the competitive influences and relevance to consumers within their local environment. Without considering the changes associated with local business dynamics, income dispersion and economic variations, the relationship between a media channel and target attribution may be less powerful in delivering business objectives.
It is time to aim higher and take action with more intention to connect media and marketing innovation to the economic evolution that is influencing local consumption patterns and competitive activity. Bringing focus and data solutions back to a local market level can also offer an antidote for an industry that has been plagued by increasing uncertainty, transparency concerns and overall harmonization.
Image at top courtesy of Corbis. The opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaVillage/MyersBizNet management or associated bloggers.