Why Are Spend-Based Marketing Audiences So Powerful?
A great truth that has proven itself over and over is that the best predictor of future purchase behavior is past purchase behavior. Think about your own shopping and buying habits. You might browse the internet as you envision your ideal vacation, clicking links to check out the best-reviewed resorts at your dream destination or checking the costs of flights to travel there. Or you might add an aspirational “wish list” item to your shopping cart. While these intent signals are useful in their own right, Kris notes that there is a big difference between aspirational shopping behavior and actual buying behavior.
“Spend-based audiences are defined by what consumers are actually purchasing as opposed to what they might be shopping for or even what they may claim they are planning on purchasing,” says Kris. “Making a purchase represents a consumer’s commitment and an indicator of their priorities. So using that spending data—observed across a vast number of American consumers—is the most effective way of identifying an audience of people likely to become your best new customers.”
Kris notes that there are three main reasons why spending data is such a powerful predictor of consumer response:
- It indicates higher potential for future spending behavior because it represents actual purchase data, not just “shopping around” behavior.
- It confirms recent verified interest in a product or category.
- It confirms the capacity of individuals to make a purchase at a given price level.
Of course, spend-based audiences are only as powerful as the purchase data that they use. And the more diverse, detailed, and recent that data is, the more the potential benefits of using spend-based audiences are unlocked.
Here at Wiland, our proprietary data assets cover multiple dimensions of consumer spending, including donations to nonprofit organizations, digital and print subscriptions, purchases across diverse categories, social media engagement data, and more. This vast and diverse data paints a truly comprehensive view of a consumer’s spending behavior.
“By way of example,” said Kris, “even if your brand doesn’t sell skis, it could be important for you to know that a consumer is spending on ski equipment—there could be opportunities to market winter gear, lift tickets, winter vacation packages, or a snow sport publication to them. The purchase data verifies the individual’s commitment to spending both on a specific item and in a specific category, which is very powerful for marketers to know.”