With St. Patrick’s Day coming up, little kids are busy making leprechaun traps with the hope that they can barter with a trapped leprechaun for the famous pot of gold at the end of the rainbow. Their parents tend not to let on that it’s a quixotic pursuit (more on that in a moment), happy the kids are busy and impressed by the strength of their convictions.
I bring this up in the context of the pursuit of a 360-degree customer view. A Gartner Maverick* Research report from last year claims that achieving a “mythical 360” (its words) may be as fruitless as catching a leprechaun.
The report acknowledges that it somewhat contradicts the prevailing wisdom that pursuing a 360-degree view of the customer is a mandate for most organizations and that, as such, its findings should be “treated with caution.” The prediction that caused a bit of a stir is that “By 2026, 80 percent of organizations pursuing a 360-degree view of the customer will abandon it because it doesn’t adhere to data privacy regulations, relies on obsolete data collection methods and obliterates customer trust.”
To address confusion, Gartner published a follow-up blog stating that its research “isn’t an indictment against customer data. It’s an indictment against the quixotic pursuit of an omniscient customer view.”
A Golden Record and a Personalized Experience
The view here is that a 360-degree view is neither idealistic nor impractical. The prevailing wisdom exists for a reason; achieving a single customer view is a noble pursuit that is a key condition for providing an omnichannel customer experience that drives revenue. In a recent Harris Poll commissioned by Redpoint, 39 percent of customers surveyed said they will not do business with any company that fails to offer a personalized experience. Recent McKinsey research found that personalization drives up to a 25 percent revenue lift depending on an organization’s ability to execute. The more skillful a company becomes in applying data to grow customer knowledge and intimacy, the research found, the greater the returns.
Before directly addressing the Maverick* claim, we should level set to make it clear what Redpoint means when we talk about a single customer view. A 360-degree of the customer is also sometimes known as a Golden Record, a single source which provides a brand everything there is to know about a customer. The Golden Record combines data from every conceivable data source, in real time. It links together all proxy identities for each possible customer – including unknown customers – and provides a robust long-tail of transactional information that includes everything from granular behavior to KPIs to transformations summaries. Because data is ingested and processed in milliseconds, a Golden Record provides business users with a complete, valid contact graph that is current up to the millisecond. With it, users are empowered to deliver a hyper-personalized, omnichannel customer experience that is always relevant to an individual customer journey, persisting the experience across a complete customer journey.
With this definition of a single customer view in mind, we can now address the three reasons why the Maverick* Research report predicts the majority of companies will abandon the pursuit of a 360-degree customer view: 1) it doesn’t adhere to data privacy regulations, 2) relies on obsolete data collection methods, and 3) obliterates customer trust.
Safeguard Data Privacy
Claiming that marketers find it increasingly difficult to obtain and secure data needed to build a 360-degree customer view without running afoul of complex data privacy regulations, the report essentially claims the risk is not worth the reward.
The counter argument is that a business assumes more risk for violating data privacy regulations without a 360-degree view. Yes, managing privacy preferences at an individual customer level is a complex undertaking, but if the alternative is to avoid collecting customer data out of fear that more data translates to more risk, the former option is the better choice.
Meeting privacy and security needs are a central component of the rgOne customer experience platform. Advanced identity resolution capabilities with real-time updates are part of the Golden Record, laying the foundation for privacy compliance at the individual consumer level. The platform specifically addresses GDPR consent and data governance issues by collecting and managing consent at a granular level, and maintaining a historical archive of consent approval or revocation, among many other security-related tasks.
First-Party Data will Never Become Obsolete
As to the prediction that a majority of organizations will abandon pursuit of a 360-degree customer view because of obsolete data collection methodologies, we tend to agree. Data collection methodologies such as the widespread use of third-party cookies are obsolete. As too are data collection approaches that rely on “homegrown” customer data platforms that tie together multiple customer engagement applications that are typically organized around process or channel siloes, clouding a single source of truth for customer data.
Limiting marketers’ ability to track users across the digital landscape might indeed curtail some organizations’ pursuit of a customer 360, but the rgOne approach to identity resolution recognizes that first-party data is the lifeblood of a single customer view. Using persistent keys and built-in probabilistic algorithms using first-party data only, the platform resolves individual identities from multiple sources. First-party data processing at the point of ingestion, applied immediately to a customer record, provides business users with supreme confidence that every customer record consists of the freshest, most up-to-date data – data that customers themselves are providing, rather than relying on a third-party organization’s customer data.
Reinforce Long-Lasting Customer Trust
It’s more accurate to say that people don’t want you to show that you know everything about them. A hyper-personalized customer experience is not a blank check for a brand to use every piece of information that constitutes a customer profile. The appeal of using a single view of the customer to deliver a next-best action is that data is used only in so far as it delivers a relevant experience at a precise moment of a customer journey. Actions are delivered (or not delivered) in the context of a dynamic, omnichannel journey. One important component of the rgOne platform is that next-best actions are rule-based, not list-based. On-line, self-training machine learning models ensure that rules are dynamically updated so that they are always in the context of a journey and in the precise cadence of the customer. Every email, message, image, offer, etc. are optimized for each interaction with a customer. A high degree of relevance eliminates any concern about the so-called creep factor.
The Harris Poll survey commissioned by Redpoint addresses this concept, and finds that consumers are aware that a personalized customer experience depends on the consumer providing data. In the survey, 66 percent of respondents said that they are willing to provide brands with more information about them if it is used to create a more valuable experience.
Rather than withdraw from or abandon a brand, consumers presented with a hyper-relevant customer experience will move in the other direction, rewarding the brand with loyalty. In a recent Dynata survey commissioned by Redpoint, 74 percent of consumers said that feeling understood and truly valued by a brand is more important to them than discounts and loyalty points. And 64 percent said they would rather purchase a product from a brand that knows them.
Create Value with a Single Customer View
Our argument is that a 360-degree customer view creates value for customers by virtue of creating a personalized experience that demonstrates a personal understanding, and is thus worth the investment.
While we would not attach the word “mythical” to the pursuit of a 360-degree customer view, we can certainly stipulate that it is not an overnight sensation. It takes the right technology as well as a shift in mindset, culture and talent to shift into the top-quartile performance in personalization that McKinsey estimates will generate over $1 trillion in value across US industries.
Is that chasing leprechauns? Technically speaking, the pot of gold at the end of the rainbow may only exist in our imaginations. But there’s something to be said for an aspirational pursuit and a childlike exuberance for the art of the possible that does translate to newfound riches.