The best-selling book “Crazy Rich Asians,” which begat the 2018 hit film, has nudged retailers to laser-focus on engaging with young, luxury-loving Asian and Asian American consumers. The demographic is not only driving luxury consumption in Asia, but globally — and because they spend so much time on digital media, that is where retailers must go to find them. One of the best ways to do that is through programmatic advertising via digital media firms like The Trade Desk.
Two years ago, Susan Vobejda left her post as executive vice president and chief marketing officer of American fashion icon Tory Burch to become CMO of The Trade Desk. Vobejda discussed the future of programmatic advertising — and why it’s the best way to reach Asia’s young luxury consumers — with STORES contributing writer Bruce Horovitz.
What is The Trade Desk?
The Trade Desk is a demand-side platform. Much of digital media is bought using technology like The Trade Desk. Advertising agencies used to call publications like Bloomberg or Vogue and buy purchase orders. Today, instead of buying from the publisher, you use data to buy computer segments no matter where they are on the internet. You do that using tech platforms like Trade Desk. It’s all about data-driven advertising.
Why should retailers care about The Trade Desk?
Adults in the United States spend an average six hours daily on consumer digital media. The vast majority of retail store visits are influenced by digital media. In fact, digital media is the major driver of store visits, so it’s important to be in front of consumers across digital media platforms like phones, tablets and laptops, and across properties they are viewing online.
How directly can you target with programmatic advertising?
You can target very specific customers who you already have, or you can profile your most likely customers and encourage them to come into the store for the first time. We can use your own data or third-party data — or both. It’s always better to use data than to guess.
How can a retailer target a potential customer with The Trade Desk?
I realized as a fashion CMO that the closer we got to using data and technology, the more effective I was in my strategies. For example, I wanted to target women who lived a few miles from our stores, but I also wanted to target women who shopped at my competitors. At the same time, since it was snowing outside, I also wanted to target women who were searching for warm weather destinations. That’s a more detailed strategy.
You can enable that strategy in about five minutes on our platform. I also could track how many people saw my ad and went into the store as a result. That’s new territory. Every fashion CMO knows that data and tech fluency is critical to driving customer acquisition and return on investment for their brands.
What do most retailers get wrong when it comes to advertising?
It’s all about the customer journey, yet most retailers spend the majority of their money on the search and the last click. But retailers that win manage the journey by using a variety of messaging. Over-investing in search is a major mistake. Then you’re just looking at the last click. Consumers need to have a sense of your brand before you get to search.
Can you provide an example?
Let’s say you’re a retailer selling luxury handbags. It’s easy to use data to see likely purchases of competitive products and target them if that’s your strategy. Competitive conquesting is a major opportunity for fashion marketers. When I came to The Trade Desk, I executed the campaign where I was trying to target likely women shoppers but also women who lived in snowy areas who were searching online for travel in warmer climates. I could see competitive data sets on the platform, including likely buyers of competitors’ shoes and handbags. Those were my most desirable targets.
Why is that deep digital strategy so critical to reach young luxury consumers in China?
Many retail brands and luxury fashion brands have significant business in China. Typically, you under-invest in China. Say, if 40 percent of your sales are in China, you might spend 20 percent of your ad dollar trying to reach them because it’s so difficult.
Did the luxury consumer draw The Trade Desk to China?
The Trade Desk has just launched programmatic buying in China. We are in a unique position because we work with premiere media companies in China like Alibaba and Tencent, which owns WeChat. We are giving the brands we work with access to inventory on those premium platforms. Our platform lets you target budgets against your most likely prospects. The Chinese consumer travels a lot around the world, and you can reach that consumer as they travel. We understand that and can target them with a message.
How powerful is the young luxury consumer in China?
The Chinese consumer under age 40 is driving luxury consumption there, and globally. China has the most internet users of any country — 802 million. That’s about 20 percent of all internet users worldwide. Some 92 percent of global marketers believe that China is a significant growth opportunity. China has the biggest middle class in the world, with 400 million people. Young Chinese consumers dedicate 20 percent of their discretionary spending to luxury items.
How can brands use digital media to create the impression of a luxury experience?
Engagement is so important for fashion brands to consider through the digital and physical experience. Everything you think about while marketing a luxury brand is about the experience that you are offering to create a world the consumer can enter. You have to make the consumer feel special with an end-to-end experience in luxury. It’s up to the brand to create that experience.
What’s the best way to reach the young luxury consumer in China?
I can’t overstate the role mobile plays in their lives. This audience did not start with desktop. The mobile experience is critical for marketing in China. It’s mobile-first marketing when targeting the younger demographic. China has almost 800 million mobile internet users.
What about non-luxury retailers in China?
It’s really the same proposition.
What’s next for marketing?
What’s coming has already started — connected TV (television that can be connected to the internet and access content beyond what is available via the normal offering from a cable provider). You as a retailer can target certain customer profiles within a smaller demographic region very cost-effectively with connected TV, especially with the young demographic in the United States. Many do not have or use cable subscriptions. By 2022, some 95 million U.S. households won’t have cable.
What do you project 10 years from now?
We believe all digital media will be programmatic. It’s the way media is being purchased. It’s so much more cost efficient. This is the future of marketing.
Bruce Horovitz, a freelance writer, is a former USA Today marketing reporter and Los Angeles Times marketing columnist. He can be reached at email@example.com.