In 2006, Clive Humby coined the phrase, ‘data is the new oil’.
That was 14 years ago, and yet still today, marketers are grappling with the challenges of making sense of their customer data to deliver actionable insights that improve the customer experience and build competitive advantage. In this episode of our podcast, The Experience Makers, we explore these challenges and the technologies that are now looking to solve them.
Our host, technology journalist and author, Gemma Milne, is in conversation with Alex Steer, Chief Data Officer at Wunderman Thompson and Cognifide strategist, Mark Deal. Download the episode now for just over 35 minutes of topnotch expertise and advice. To whet your appetite, here are a few of the key talking points:
Today’s data challenges
The big challenges around data are the big challenges around growth in general. Businesses – particularly in the wake of COVID-19 – are constantly asking where they can find new sources of growth. The answer lies is in understanding that you can’t treat customers as if they are broadly the same or fit into a similar demographic. The potential for growth will often life outside of the mainstream. So, the big challenge for data is in understanding customers better, understanding their journey and experience, delivering better outcomes and targeting those that represent the best opportunity for growth.
A constantly evolving legislative landscape compounds this. GDPR, CCPA and other flavours of legislation around the world mean that businesses are constantly looking for support around governance. Possibly because of this, technology stacks tend to be more focused on business control than on the flexibility that’s required to enable customer data to really thrive in the experience context.
However, when the value exchange around data is responsible and brings value to the customer, it's easy to see how data doesn't just shape an experience, but fundamentally shapes the next generation of products and services. This should not be used as a license for unlimited surveillance, instead, the right data should be used to humanise experiences. Spotify is one organisation leading the way, in this respect. Every user experience is different, and customers see this as something that is not exploitative but that, instead, adds real value.
What technologies are businesses turning to?
Customer Data Platforms or CDPs give Experience Makers a single, central source of data with that value exchange built in.
According to Mark, a CDP has the potential to elevate a customer relationship to empathy-based, rather than sales-based. So, for example, when a customer lands in the support area of your owned site, you can see immediately see that and understand where that customer is in the lifecycle, responding accordingly. W
underman Thompson Data has recently published a paper on the CDP landscape for those looking for advice. Course Correction acknowledges that many businesses are now evolving when it comes to investment in data technology. The first generation of adopters are now looking for a more sophisticated solution that recognises that the insights generated by data need to be employed on several different channels: websites, media, CRM and direct mail, to name a few.
The 2nd generation of CDP sits in the middle of your customer business and provides the hooks or the glue between every customer touchpoint, allowing marketers to resolve the identity of that customer in a way that gets better over time.
However, Alex issues a health warning, “you can’t technology yourself interesting”. A CDP is a very sophisticated piece of kit but it's not a substitute for knowing your customers. Organisations still need to think very carefully about how they will have a meaningful conversation with a customer when they recognise and know them.
Does a CDP help with compliance?
Although we are now in the world of 2nd generation CDPs, there still isn’t a standard set of CDP capabilities. However, they do tend to focus around a set of common core capabilities, of which one is now compliance. However, Mark warns that you may need to look at integrating adjacent, specialist technologies, for instance, a consent and preferences management solution, that provides customers with an intuitive UI for preference selection. Working side by side, a CDP would provide GDPR (or similar) assurance by, for example, deleting specified data when asked.
Return on investment
As ever, our Experience Makers debate, the all-important question, what will success look like and how do we measure it?
While there are a bunch of intermediate metrics based around technology adoption and usage, ROI measurement should be based around goals linked to growth. Is the technology providing customers with better life-time value? Is it reducing churn? Is it increasing conversion? Make sure that your KPIs are based on specific outcomes, aligned to growth.
Who is responsible for being responsible with data?
A year or so ago, there was much talk of customers taking charge of their own data. However, the truth is that customers don’t really want to invest lots of their time thinking about this so, instead, we are seeing an emergence of lots of regulators. The reality is that the effort required from an individual to manage their own data is too high. So, regulation is improving on behalf of the consumer. Even when consumers are extremely digitally savvy, to expect them to concern themselves with the minutiae of day-to-day data management is too much.
Today data is very much a brand issue. Whereas, 5-10 years ago it was perceived as an IT or technology issue, even something that could be outsourced to an intermediary; brands are now judged on the responsible use of data. It is an expectation of brands and if they are perceived to be exploitative, or creepy, they risk damaging their reputation.
Practical advice for organisations
“Translate everything into human.” - Alex Steer
It’s too easy to look inwards when we talk about data - at our organizations, our databases and tech stacks. But data is “just customers in disguise” and, when we talk about data, we should describe everything we do in terms of people and the outcomes we want to deliver.
Furthermore, think about those outcomes in the context of customer journeys. And extend that to beyond your owned digital estate. Avoid working in silos that don’t allow these journeys to become cohesive - you’ll be presenting a fragmented experience. Instead, think about the quality and power of the data but also what you really want to achieve for your business. Then set up an architecture that joins everything together and allows consumers to flourish wherever they are in their journey. Download the podcast to learn more now.
24 September 2020Kieron McCann
27 July 2020Josie Klafkowska
17 June 2020Rosie Barrett
People in or team love to share their experience. Explore our blog
We're always looking for new faces to join the Cognifide family. Take a look at our available jobs.