Everything you need to know about activating data in the new data economy
Everything You Need to Know About Data & Customer Experience, in partnership with Acxiom, is designed to help marketers quickly get up to speed with one of the most important issues in today’s marketing industry. The series of videos lets you find out everything you need to know about each crucial subject in one short film – something you can watch in the back of a taxi on the way to your next crucial meeting on the subject. That’s why each episode is filmed in the back of a London black cab.
In the last instalment of Everything You Need to Know, industry experts spoke about the importance of recognising a brand’s customers. The next step in delivering a great customer experience through more relevant marketing is via the data itself.
Here are the top 10 things you need to think about when using data to create a better customer experience.
1. All data is not equal.
It comes in three primary forms, the best known of which are first- and third-party data. But second-party data, a relatively new form of data, is rapidly growing in importance and adoption.
2. First-party data should be a marketer’s first port of call.
It is data that a brand itself owns and can include transactional data from purchases, behaviours, actions or intent demonstrated across its websites, together with CRM data, subscription data and that from mobile web and apps.
A recent Econsultancy Report, The Promise of First-Party Data, found that almost three-quarters of marketers surveyed said first-party data provided the greatest insight into their customers. However, used alone it’s likely to be limited in terms of depth and scale.
3. Third-party data is often used to supplement a brand’s own.
It is data that is collected and curated by others for brands to add to their own existing assets and has the ability to deliver a continuity of insights across all consumer touchpoints. Jed Mole, Acxiom European marketing director, says it can also help explain the ‘why’ of much of the behaviour that a marketer can see through its own first-party data. For companies which have not yet built up sizeable first-party datasets it can be an incredibly powerful asset and accelerator.
4. Second-party data is growing in importance.
Essentially, it is the use of another company’s first-party data. Brands and organisations are increasingly realising the potential and value of the data that they have to others – so expect the use of second-party data to continue rising.
According to Econsultancy in 2015, 77% of marketers that reported the highest returns on their data-related investments were leveraging second-party data. Across the board, some 60% of marketers expected to increase their use of second-party data.
5. The sophisticated use of all three parties of data is contributing to what Mole calls the ‘new data economy’, and that requires new rules.
New data owners are looking to monetise their assets – however, they must do so in privacy safe and compliant ways. That requires marketers and their partners to have an open system for curation, validation, governance, enhancement, packaging, distribution and billing.
6. Safe havens (such as Acxiom’s Safe Haven Exchange) can help keep a company’s data compliant and brand safe.
Within a safe haven, a brand and their partner (another brand, or publisher, for example) both put their de-identified and legally compliant data through an independent ‘black box’. In this system, each partner gets the benefit of the combined data intelligence and insights without ever seeing or having access to the other’s data.
7. Combining data sources can be greater than the sum of their parts.
By using a safe haven, one Acxiom client – a global financial services brand – was able to achieve the same new customer gains through reaching just one-eighth of the audience by being able to combine its data with that of a publishing partner to improve accuracy. As Engine Group head of strategy Pete Edwards says: “The most sophisticated players are truly joining up as many data sources as possible, and from there you can be more sophisticated in your customer approach.”
8. Accessing new data is essential.
The ways consumers shop and behave has changed dramatically, so marketers must be where intent is signalled and decisions are made. For instance, 15 years ago, people purchasing a new car might visit a dealership six times before buying – now, it is less than two. A 2016 CarKeys.co.uk survey found that the overwhelming majority (97%) of new car buyers arrived at dealerships having conducted online research that informed their car buying intentions, with more than a third of those researching further via their mobile whilst in that dealership.
9. Identifying online to offline journeys is vital.
With more of that consideration now done online, brands must keep up with the customer in the digital space, the data being created there and sound strategies to harness it both online and offline in privacy compliant ways to deliver more relevant marketing. How to connect data across the offline-digital divide will be tackled in a later issue.
10. Beware of false positives.
To paraphrase: let the data tell the story, the whole story, and nothing but the story. As Mole warns: “We must always aim to humanise data by ensuring we don’t simply take it at face value.” Consider the person who buys a one-off gift for a friend or colleague’s new-born baby and is then spammed by ads and recommendations for other such toys. On the face of it he is in the market for more of the same, but if the total profile had been taken into account, it should have been clear that this consumer is a one-time purchaser.
Above all, let the data tell the story. It is why, in this new data economy, there also needs to be a new customer view. The series will tackle this next generation single customer view (SCV) in the next issue.
This article was originally published in The Drum magazine.