Why Marketers Must Prioritize Customer Identity
How well do you understand your customers?
Most marketers would probably say they have a solid understanding of their company’s target consumers. In today’s digital world, however, the concept of ‘knowing your customer’ has become highly complex.
On one hand, brands are now spread out across a variety of addressable channels — from social to out-of-home advertising, from e-mail to targeted ads. Meanwhile, as Daniel Portoff, Product Manager at consumer credit reporting agency Experian, writes, customers similarly now “have footprints in the offline and online worlds, and tend to seamlessly transition across various channels and devices.”
This still-developing cross-channel and cross-platform dynamic between brands and consumers ultimately presents a unique challenge to companies looking to develop a granular understanding of their customers.
Marketers must question how effectively they can drive and manage customer engagement across all the channels where their brand operate. And, more importantly, when a consumer comes into view of one of these channels, marketers must be prepared to turn that moment into an opportunity.
This increasingly elaborate marketing environment has placed customer identity among the buzziest industry trends. Indeed, it is fast becoming a vital strategic approach for both marketers and technology vendors who want to harness the vast amounts of consumer data that can now be leveraged.
Yet, according to a recent Forrester report, defining and maintaining customer identity accurately is one of the toughest challenges for digital marketers. Another report from Digital Marketing Depot backs this assertion, finding that “due to the rapid increase in connected devices and new digital touch points, only 15.3% of organizations are able to overcome this complexity and consistently and accurately identify their audiences.”
What is customer identity
That said, what exactly is customer identity and why should every company build a comprehensive customer identity?
Gone are the days of simplistic consumer segmentation. For instance, demographics such as age, gender and income — for decades the most readily available metrics to define an audience — are out of date.
Customer identity, rather, makes use of the troves of consumer data, signals and digital identifiers now available via the myriad digital channels and platforms people use.
As Signal writes on its company blog, there are many ways for marketers to pin down somebody’s identity in the digital space: “Websites, for example, can drop pixels that track a single user across the web. Mobile sites and apps can identify a device ID and tie that device to a set of behaviors that suggest a user profile. These inference-based tactics – using probabilistic data – help marketers get close to understanding who their user might be.”
Historically, Signal explains, the issue with this type of data is “the siloed nature of the always-changing digital ecosystem” from which it comes. In other words, generally the identity profile that marketers establish is channel-specific, relevant only to a single type of device, browser or platform.
A robust and persistent customer identity, though, offers a single view of an individual. It crosses devices — from desktop to mobile web to in-app — and de-duped.
Why marketers should care
As Digital Marketing Depot reports: “Identity is where everything starts. Every process, operation and insight leading to audience creation, engagement, improved customer experience and compliance. Therefore, it is critical to understand the many complexities of identity when building a solution for your brand.”
With data driving and impacting more elements of business operations than ever, the need for identity has grown significantly in importance and relevance. That explains why 58% of US organizations have placed more focus on identity year-over-year, while 47% have said they plan to invest more on identity solutions through 2019.
In contextual dollars, US marketers are expected to invest just shy of $900 million this year on identity services and solutions (device graphs, data processing and management platforms, and services).
Marketers who manage to stitch together those disparate stacks of audience information, insights and engagement will be able to shape a more seamless and personalized cross-channel customer experience, as well as make more informed business decisions that will lead to more meaningful interactions with customers.
Plus, if a company has a unified customer identity, and that user remains logged into a social media platform, brand site, e-mail account, or any other online account, she or he can be identified — not as a collection of data points, but as an individual — on web or mobile.
Crucially, like most competitive differentiators, what’s most important when determining customer identity are the suite of identity management tools you use, (for example, customer data platforms), and the expertise necessary for effective execution.
