The next step in your customer experience journey
Targeting digital ad campaigns with third-party data has been the go-to tactic for years, with data being collected via third-party cookies from websites all over the internet. But its power is waning. Not only is third-party data riddled with issues – it’s often incomplete, inaccurate, outdated and collected without knowledge or consent – but it’s about to become all but obsolete. Apple already blocks third-party cookies and Google has announced that they’ll follow suit in 2023.
That means digital marketers need another source of customer information. As the landscape transforms, more businesses are developing data strategies that are based on their own first-party data. With recent advances in customer data tools, the technology to manage this approach is now available – making it a viable option for more organisations.
A first-party data strategy uses data you gather directly from your own customers to help you make powerful connections with them. By harnessing data from all in-house systems and touchpoints throughout your customers’ digital journey, you can gain real insight into their wants and needs. This can be used not only to run accurate re-targeting ad campaigns aimed at loyal customers, but to craft a smooth, seamless and intensely personalised customer experience across all your touchpoints.
Balancing the personal and the private
In the digital world, personalisation is no longer optional. Consumers expect a seamless, customised experience whenever and wherever they interact with your business. Of course, that personalisation needs to be tempered with privacy protections – people don’t want to feel that their personal information is being collected, used or shared without their permission.
Balancing those factors – and meeting increasingly strict privacy regulations – is one of the problems facing marketers as they work to develop effective first-party strategies. Other barriers include data siloed in different business areas or software systems, lack of technology to help collect and analyse datasets, and constantly evolving technology that can be difficult to understand.
Why first-party data is the future
First-party data is information collected directly from your customers during their interactions with your business, including account details stored in your CRM, browsing data from your website or app, sales transactions, social media information, feedback and surveys.
Because this information comes directly from your own sources, you know it’s reliable and current. There’s no question around authenticity, and you can set privacy protocols to ensure you’re meeting legal requirements.
With an effective first-party strategy in place, you can connect the data dots across your business, drawing information from a range of sources and using it to gain powerful insight into your audience. With that insight, you can fine-tune the customer experience and provide a ‘just right’ level of personalisation across multiple channels, without compromising privacy. Most importantly, you can drive growth in your business by targeting the right people with the right messages.
Hang on, aren’t we doing that already?
Many companies already collect data from one system and push it to another. For example, you might push customer transaction data through to your marketing automation system to help target future email promotions.
These are called “point-to-point” integrations, and they can be an effective way to get value from customer data – but they don’t necessarily scale. If you’re using lota of these integrations, you’ll end up with a complex mess of connections and inconsistent data points, which has obvious downsides. Managing the integrations is a time-consuming task, particularly without expert help, and you have no way to get a unified view of your first-party data.
The right tools for the job
Over the years, technology has come in waves, with each innovation solving part of the first-party puzzle. CRM systems offered a complete view of the customer – but failed to integrate with digital marketing systems. Marketing automation accelerated campaigns but offered little in the way of analytics. DMP systems were touted as the connection between CRMs and digital advertising but relied heavily on third-party cookies. Finally, data warehouses promised a centralised repository for all business data – but didn’t hit the mark with privacy or real-time results.
The customer data platform (CDP) is the latest evolutionary step in a long line of data technologies. Widely used in the US, Europe and Australia, it’s only just coming into play in New Zealand.
A CDP makes your first-party data strategy possible. According to rules set by your business, the platform collects data from all your first-party sources – including your website, mobile app, in-store, call centre and IoT – and unifies it to create accurate, responsive customer profiles. The platform integrates with your other digital tools, so insights can be turned into actions in real-time – or close to it.
A CDP unifies the view of your customer
A true first-party data strategy has three key steps: collection, unification, and activation. The crucial step that takes your strategy from basic to turbo-charged? Unification. It’s relatively simple to collect and use data from a single source, but getting a fully fleshed out single view of the customer is another thing altogether.
With a CDP, it’s possible to unify data from all tracked interactions for an individual customer, creating a data supply chain that’s constantly enriching your central customer profiles. In turn, the CDP constantly updates your other marketing systems with audience insights as needed to activate those highly personalised and effective customer experiences, not just at the point of sale but throughout acquisition, conversion, onboarding, retention and ongoing loyalty.
In some ways, it’s a return to the good old days of corner-store retail, where the key to success was building valuable, long-term relationships with customers, and genuinely connecting with them. Only now, instead of being the friendly shopkeeper remembering your customer’s name and favourite order, you have a CDP working in the background, crunching thousands of data points to build a full picture of each customer’s wants and needs.
Ready to start? Talk to the team at SpeakData – New Zealand’s leading CDP consultants.