Almost without exception, marketers are being told that they need to use data to make decisions. Data from ad engines, data from websites, customer data - and, of course, survey data which tells marketers how well they have used data to improve their product.
The end result of using all this data is, theoretically, that marketers should better understand the customer and the customer journey, making marketing easier and more effective.
But is this really happening? Are marketers using data to obtain a single customer view and improve the customer journey?
To find out, Digital Cream, in association with Amazon Web Services, recently held roundtable discussions with dozens of client-side marketers in Singapore. At the Data-driven Customer Journeys table, moderated by Jane Christensen, Asia Insights Leaders, 3M, event attendees discussed the data problems they were facing and potential solutions.
Below are highlights from the day's discussions.
Data problems
1) Data is spread out all over companies
In many of the organisations represented by event delegates, customer data is spread across multiple departments, each with their own systems.
Participants reported that data that could be used by marketers to better understand the customer and their journey is currently residing on ad engines, weblogs, CRMs, sales database, and customer service portals. Even organisations with the most comprehensive customer data (e.g. insurance companies) still had data in places where it wasn't accessible to marketers.
Attendees agreed that this was a particularly difficult problem to overcome as business heads are not motivated to grant access to their department's data - and without senior-level buy-in, data-driven customer analysis was simply not possible.
2) Data is difficult to interpret
Problems with using data to better understand customers is more than an organisational problem, though. Attendees who felt like they had relatively good access to data confessed that they are still struggling to make use of it.
The reason for their struggle is that they use customer data to improve the customer journey with personalisation. For this to work, marketers need to draw out useful personal information or 'signals' from data. These signals are then read by personalisation engines to create ads, web experiences and communication which is contextually relevant to the customer.
Some indicated they have been able to use customer data for standard personalization, such as welcome emails. Others, however, lamented that when they try to anything more sophisticated, such as recommendation engines, they were unable to pull meaningful information from the data.
Another delegate noted that they had the same trouble with using data for loyalty programmes. The basics, they said, are relatively simple but creating a bespoke loyalty programme was much more difficult than it appeared at first.
3) Marketers are unsure about data privacy
Attendees also concerned about data privacy and its impact on their ability to improve the customer journey. On one hand, they know they need to use data respectfully, but on the other personalisation, by definition, requires personal data.
Legislation, some participants argued, is one way of determining how data should be used by marketers. Others, though, felt that laws, while useful for protecting privacy, offered little help when deciding whether a data use case was appropriate.
The real problem, said one participant, is being able to tell when data helps improve a customer's experience and when its usage becomes 'creepy'.
Data solutions
1) Build strategic data partnerships
Attendees agreed that the first thing which needs to be done is to reach out across the organisation and 'sell' the concept that consolidating data is a good thing for everyone, not just for marketing.
The end goal is to convince the gatekeepers of siloed data that combining data wil allow them to understand the customer better which will make their department more effective.
2) Integrate data sources
Once department heads are convinced that sharing data is a good idea then marketers need to find technical solutions for combining data and making it available across the organisation.
Projects like this can be difficult, according to one participant. It takes time to find a solution and even more to implement it.
One way around this problem, another suggested, is for the company to use a 'data lake'. Data lakes are repositories which centralise an organisation's data without spending a lot of time cleaning and organising it.
One delegate said that using data lakes makes centralising data initiatives relatively easy - and more likely to succeed.
3) Focus data analysis on 'next best action'
When data is finally centralised, marketers face another problem. Having one source for all customer data makes many new projects feasible and marketers risk ending up in a state of 'analysis paralysis.'
To overcome this, attendees agreed that marketers needed to know specifically what they plan to do with data once they have it centralised.
One participant argued that the most effective use of customer data is, as mentioned previously, personalisation. To personalise communications effectively, though, marketers need to think carefully about the next thing they want customers to do, or the 'next best action'. The next best action could be to purchase an associated item (e.g. shoes which match a pair of trousers) or to read a new article based on their previous reading habits.
Putting this into practice, though, requires more than just data. Marketers must think about the next best action for a wide variety of customer interactions and then determine whether they have the right data to make a recommendation. Then they will have to test the algorithm to see whether it improves the experience.
So, while marketers are facing significant challenges in using data to get a single view of the customer and improve the customer journey, it does seem like they are working hard on the problem. Most, however, still have a long way to go.
A word of thanks
We'd like to thank all the hosts for the Data-driven Customer Journeys, Jane Christensen, Asia Insights Leader, 3M and Ganamanas Das, Head of Business Development, Big Data & Analytics, ASEAN, AWS.
We'd also like to thank all the marketers who made time out of their busy schedules to discuss data-driven marketing and we hope to see you at all future Digital Cream events!
