Pop quiz, marketers: how would you define the term household in 2018? Is a household determined by people who share the same last name, or people who share the same physical address, or car, or computer? What exactly is a household in 2018?
Gone are the “Leave It To Beaver” 1950s-era households in which David Jones lived with wife Becky Jones at 314 Magnolia Lane with their 2.5 children, Wally and Amber Jones, and their happy dog, Spark. Gone are the days in which no one got divorced; and the Joneses “stayed put” at one address, behind a white picket fence for their entire lives. Years ago, when a lot of this (direct marketing, direct mail campaigns, TV commercials, etc.) was being created, the definition of household was much simpler and therefore, easier to target for marketers.
But, as you know, households and families of today are much more complex—lines and traditions are being blurred, blended, and erased entirely. We may still have David Jones married to Becky, but she’s decided to keep her maiden name, Becky Wood. And they’ve lived at seven addresses, not one, over the past 20 years. They have three children who share their last name as well as a friend, Greg Kovack, who’s renting a room from them; and they run an AirbNb out of their home. That makes six-plus people, give or take a few, living at the same physical address.
As marketers, it’s hard to keep up with the Joneses, isn’t it? But keep up with the Joneses, you must.
Resolving household identity matters because audience still matters—now, more than ever. As marketers continue to reach out to consumers across digital and offline channels there’s always an element of “What does your audience look like?”—and overwhelmingly, audiences are built on individuals—but in some cases, marketers will look at household level data for acquisition marketing and more.
What is a Household?
Even as the landscape of marketing changes, householding (grouping all members of a household together for marketing purposes) continues to be a very important aspect and category across direct marketing. Understanding how a household is defined and how data is associated to a household is a necessary step for marketers to ensure your data selection is aligned with your audience selection approach.
Merriam-Webster defines household as “those who dwell under the same roof and compose a family; also: a social unit composed of those living together in the same dwelling.”
In this post, I’d like to help you further define and grasp household in the context of digital and offline marketing. We’ll also explore two reasons why householding—or household identity resolution—can ensure your marketing campaign success, and ultimately, boost your bottom line. Smart marketers practice householding. Here’s why, and two steps to help you get started.
Householding Helps You Air The Right Message at The Right Time
Let’s say that your goal is to reach a household with a product (such as a new SUV through television ads). You’re sending your broadcast signal to the TV, but you don’t know if anyone is there. Your goal is drive awareness of your new product. And you want to figure out who exactly you’re presenting that product to. That’s just smart marketing. In this scenario, you need to think: households, not individuals. You want to air a message to those who are actually gathered around the television, right? If you understand who is gathered there, under that roof, in front of that TV, you can craft the right creative to reach your target audience.
Householding Helps You Determine Household Purchasing Power
Defining a household is an important first step for marketers who want to determine the buying and purchasing power of that household. Defining a household is the key foundation for then associating demographic, transactional and other types of data to assess and act on the household’s purchasing power.
Without household identity resolution, you will not understand the power and likelihood of the household to respond to your offers. This is the foundation for relevant, smart marketing.
As I stated earlier, “What’s a household?” remains an interesting question for marketers and for the data business. As human beings continue to do things that disrupt traditional definitions of household, smart marketers must stay apprised of technologies and data solutions that can lend clarity to your search for who’s in household. Here’s how.
Step 1: Seek a Flexible Solution That Defines Household by Your Industry
While most industries agree that a household is a unit that collectively makes purchasing decisions—or where purchasing decisions are influenced by all individuals associated with the household unit—the specific definition varies by industry.
First, seek a data partner/solution that allows your organization to define household according to your industry and does not force a definition of household onto your data that doesn’t fit. A one-size-fits-all approach will not work here. For example, in my experience, a marketer’s definition of household can vary depending on the organization’s viewpoint and/or the product being marketed. Telecom and utility organizations may define a household based primarily on physical address or location of the service. Alternatively, a financial services organization may define a household to include joint accounts, with no real reference to a physical place (think about the college student who has a joint account with a parent to manage expenses). And a retailer may define a household as related individuals at the same physical address. Not all the same definition, right?
Be wary of any solution provider that cannot tailor their solutions to your industry. The right data partner/solution will provide you with the flexibility needed to tweak the definition of household according to industry, incorporating additional digital and offline signals into the data mix. In other words: look for a data partner/solution that allows for, and integrates the complexity of the modern household within your specific, organizational context.
Step 2: Develop Methods to Define Your Household From The Data
As life events occur, a household grows and shrinks and morphs over time. Common events include:
Individuals marry and divorce; individuals marry and females keep their birth last name; unmarried couples, previously living together, split; individuals and families move; people combine and hyphenate last names; and people move without reporting a forwarding address, or only report the forwarding address to a select number of entities.
The data that reflects the household—and a change in a household—is rarely straightforward. This is a reality I’d encourage you to get comfortable with. Dealing with ambiguity in the data requires skilled handling and patience. Events like those noted above can result in (read: will likely result in) mixed signals when interpreting the data associated with a household.
Data processing works to interpret life events based on available data. For example, the data won’t arrive at your door with a bright red flag indicating a change in household status! Unfortunately, it will arrive much more subtly. The household and any changes to the household must be inferred from data.
Let’s say that data about related individuals who previously lived at a physical address contributes to the household data that you have before you. This data might lead you off the trail in your quest for resolving household identity. This misleading data might include deceased individuals, adult children, and former spouses. These people no longer live at this physical address, but the data is telling you that they do. So, how then do you distinguish who’s actually in household now, watching TV and checking the mailbox? This requires an intelligent marketer and a keen marketing team who continually ask: “What is household in this scenario? Who actually lives there? Who is watching the TV?” It also requires the right data partner/solution to be working on your behalf.
How can Acxiom Help?
To help you with the previous challenges, we provide the following data elements to identify a Household:
- Address and Address Link. This is the physical address associated with each individual, based Acxiom’s calculation of the current home address for each individual. As an example, using this element, the key for linking individuals is the physical address that takes the form of Street, City, State, Zip OR the AbiliTec Address Link associated with that physical address.
- Surname combined with Address Link (also known as the “Household Key”). This method uses the combination of Surname (i.e. family name) and the Address Link. As an example, two adults with the same surname live at the same physical address (i.e. same Address Link) and will have the same Household Key. Alternatively, two adults with different surnames live at the same physical address (same Address Link) would be considered two separate households based on the combination of unique Surname and Address Link, and consequently, have different Household Keys.
- Household Link. Acxiom’s newest household definition, which also translates into the digital world, defines Households based on related individuals at a physical place, and where the relationship of individuals is based on additional data signals—or evidential data (data beyond Surname and physical address to identify non-intuitive relationships). The Household Link uses Address Link, Surname, and additional data signals to identify where individuals in a household are connected. In addition, the Household Link is global. Here’s a quick example:
Meet Roger, a twenty-year old man who has gone off to college and now lives across the country from his parents. But, Roger is still “linked” to the parent household. So, we might see that Roger still has an associated phone number or other such connections (discerned from data) that continues to link him to his parents’ household. Then, Roger graduates and gets married. At some point in time, we will begin to discern new signals that distinguish Roger’s household from the parent household such as: he might buy a house or start paying for his own cable and/or telephone service. Those signals will trigger a change in the parent household and help us establish Roger as his own household.
Clearly, marketing to households requires flexible data definitions that can support the complexity of our society and the requirements of your industry. In 2018, make sure that you effectively understand and define your target households to deliver the right messages for marketing success.
To learn more about our solutions for consumer data and identity resolution, please click here.