Consumers expect three things from brands they love: know me, show me that you know me and reward me. This is easier said than done when more than 2.5 quintillion bytes of data are collected every day.
To meet customer expectations and maintain a competitive edge, while also protecting customer privacy, many businesses face the challenge of identifying meaningful, quality data from all the customer data they collect. Businesses that are winning as leaders in their industry are not only supplementing their own data with external data sources to form a holistic view of the customer but then using this holistic approach to data to enable a personalized, privacy-compliant experience for their customers.
So, how can you utilize data to create a holistic view of the customer and enhance their customer journey?
From traditional in-store point of sale (POS) systems, through the website, to calling in, to e-mails, mobile applications and social media platforms, there are many drivers behind the continued growth of customer data. Some recent trends in this area include:
• Proliferation in the ways a customer interacts and buys from a brand;
• Data about customers captured from digital visits and interactions on other third-party websites and mobile applications; and
• Data captured from Internet of Things (IoT) sensors and other similar devices.
The potential business value of this data is undeniable. Appropriately leveraging accurate and timely customer data allows companies to become more efficient and timelier with their communication to the customer.
But all businesses face a simple problem, how to capture, integrate, securely maintain and utilize the data to create that holistic view necessary for personalization.
OVERCOMING DATA HURDLES
The Forrester Research report, “Need External Data? Explore The New Data Landscape,” states that the race for differentiating data is on, but many firms are struggling to find the data they need. A vast majority of companies are not effectively harnessing the insights in data to win, serve and retain their customers. Further, most businesses do not use data effectively because it is challenging to understand what is relevant to them.
To make it even more difficult, data that is relevant to one brand may not be available or relevant to another brand. IBM estimated that poor-quality data cost the U.S. economy $3.1 trillion in 2016, and nearly one-third of business leaders were unsure of how much of their data was inaccurate. A Harvard Business Review article claims, “The reason bad data costs so much is that decision makers, managers, knowledge workers, data scientists, and others must accommodate it in their everyday work. However, doing so is both time-consuming and expensive.”
Identifying quality relevant data is key to reducing costs and providing meaningful insights.
ENHANCING THE CUSTOMER JOURNEY
A data-centric approach enables companies to succeed in today’s fast-paced marketplace and deliver a seamless, richer and more personalized experience throughout the customer journey.
To deliver exceptional customer experience, companies need to leverage the right data with five crucial steps:
• Capture or obtain relevant (and accurate) data;
• Protect data and maintain privacy standards;
• Integrate data from all customer touchpoints;
• Supplement with high-quality second- and third-party data; and
• Leverage the best data to create actionable insights that attract, retain and grow the customer base.
Businesses now realize that they must become efficient in identifying meaningful quality data. They are learning to supplement zero- and first-party data with the right second- and third-party data (see chart below) to complete the holistic view of the customer and use it to enable personalized experiences for their customers.
A required first step in any data strategy initiative is the Data Inventory Analysis. Performing this analysis will provide a full understanding of all available data.
The objectives of the analysis are to confirm: data availability and accessibility; data volume and coverage; data use cases; privacy restrictions; identify any gaps or overlaps across existing data sources; and develop a corporate data strategy.
The Data Inventory Analysis is comprised of a two-phased approach:
- The Documentation and Inventory phase identifies what zero- and first-party data is accessible and how it is protected by performing a system audit, reviewing data policies and contracts, and interviewing colleagues on existing data value, practices and needs for marketing initiatives and business goals.
- The Gap Assessment and Recommendations phase identifies what third-party data is needed to help complete the holistic view of the customer by assessing and identifying gaps and overlaps across existing zero-, first- and third-party data with desired data capabilities. This assessment is used as a foundation for developing or refining a data strategy.
After completing these two phases, create a data strategy roadmap to support recommendations that enhance and improve the data strategy and governance.
After the Data Inventory Analysis is the more difficult task of choosing the right second- and third-party data. There are three distinct solution types, as shown in the chart above.
Brands should engage data providers who take a “data independent” approach to data. A data provider who is data independent will have the ability to test and evaluate multiple data sources looking at all factors: coverage, performance and cost.
A provider that understands your current data sourcing needs, marketing strategy and delivers a customized recommendation of the right data strategy will increase targeting performance and offer a cost-effective data solution.
IMPROVED MULTI-CHANNEL MARKETING
Taking the time to go through the necessary steps to create a holistic view of the customer with consumer privacy at the forefront will provide a competitive advantage. But, to see the real value, the data needs to be relevant and accurate.
Leveraging and analyzing relevant data to ensure the right message is served to customers is the key to improving multi-channel marketing efforts. Doing so will positively impact the bottom line for the long-term.