To carry out successful data-driven, customer-centric marketing campaigns, customer data management -- the practice of collecting, managing, analyzing, and using customer data securely and efficiently -- is crucial to your efforts. However, things like the volume and variety of customer data that your organization collects can make customer data management a daunting task for marketers, particularly if you have a large and growing MarTech stack or little experience in data wrangling.
Here's a look at the link between customer data management and marketing performance, and why many organizations struggle with customer data management.
What's the link between customer data management and marketing?
Customer data falls into one of three categories: first-party data, second-party data, and third-party data. Each of these types of customer data can provide actionable insights to marketers to use in constructing the most profitable campaigns. The objective of customer data management is to simplify and optimize the use of all these customer data types so that marketers can find actionable insights about their customers and make decisions that help maximize ROI and campaign performance. Armed with these insights, marketers can:
Create personalized interactions with customers. Research says that 91% of consumers are more likely to shop with brands that recognize them, remember them, and provide them with relevant offers and recommendations. Effective customer data management ensures marketers are collecting high-quality data and analyzing accurate customer records to uncover insights into customer behaviors, which then allow them to make more informed business decisions about what products to market to customers with what messages and in which channel.
Improve customer retention. When it comes to repeat purchases, customers prefer to do repeat business with brands that can provide them with personalized experiences. This demonstrates that their business is valuable and provides a positive customer experience, which is an important factor when it comes time for their next purchase. And as we said above, accurate data is critical for meaningful personalization.
Segment customers with deeper focus. Customer segmentation helps organizations produce more targeted and relevant messages to target their audience(s) with. This provides them with a buying experience that both caters to their preferences and sends them down an effective path to purchase. Identifying these customers segments requires you to analyze your customer records, which as we noted is a core component of customer data management.
Barriers to successful customer data management
Now that we've laid out the benefits successful good customer data management practices can have on marketing performance, let's look at what makes customer data management so challenging for many organizations. These challenges include:
Sheer volume of data. Every day, it’s estimated that 5 quintillion bytes of data are created from multiple online and offline data collection channels. And while your organization isn't dealing with all 5 quintillion bytes of that data itself, more data than you can handle is still likely making its way into your systems. Combine this with an inability to accurately and efficiently aggregate, secure, clean, manage, process, store and create value from that data – and you've got a big problem on your hands.
Siloed data due to disconnected systems. As marketers use more systems to carry out their campaigns, customer data is often siloed in the various MarTech tools and in varying formats. This makes it difficult to extract the data in a cohesive and useful manner, and even if the data is extracted from the various systems the result is inconsistencies and incompatibilities between data sets. But if these critical data points sit siloed across the systems and tools in your MarTech stack, it’s impossible for you to achieve a fully unified understanding of each customer. Damned if you do, damned if you don't.
Inability to translate data into actionable insights. Unless they have a background in or previous experience with data analysis, many marketers struggle to extract meaningful insights out of their data because of the previous challenges noted here. But data-driven marketing is only as effective as the quality of the data used, underlining the importance of having the right data practices and technology in place to ensure accurate customer records. And even if they do have a experience with data analysis, the right technology can ensure only the most up-to-date records are being used and help simplify the analytics process.
Make customer data management more manageable with a CDP
Marketers may think they have the right technology in place to wrangle their customer data and prevent the data management challenges listed above. After all, technologies like CRM systems and DMPs may seem like they manage data, but the reality is that they fall short in key areas.
What do we mean by this? Well in order to properly analyze customer data and uncover accurate and actionable insights, it's critical to first consolidate customer data into what’s known as a "golden record" (also known as the single view of the customer view). Golden records contain all the information you have on each of your individual customers in real-time, giving you a complete understanding of each customers' behaviors and preferences as they relate to your interactions with them. But creating such a record on your own is practically impossible because data volume and data silos prevent you from ever getting a real-time, accurate understanding of each of your customers. In other words, you never achieve a unified view of the customer.
So how can marketers easily achieve a unified view of the customer and build golden records without it completely taking over their day-to-day? Well, attaining a unified view and building golden records are both processes made easy with an advanced customer data platform (CDP), such as the one offered by us at QuickPivot. The QuickPivot CDP integrates with your existing MarTech solutions to match and merge customer data from across all your stack to form a single, golden record for each customer. It provides marketers with a single, centralized database to aggregate, cleanse, manage, and even analyze all of their customer data -- a single tool for all of your customer data management needs.
If you're a marketer struggling to get a handle on customer data management, reach out today to learn how the QuickPivot CDP can help you take control of your data and improve the performance of your campaigns.