What is identity resolution?

What you need to know about how ID resolution works to provide omnichannel insights for personalized, people-based marketing.

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Identity resolution tools take simple analytics a step further by tying online behavior to a consumer’s unique identity, giving marketers the information they need to zero in on their target consumers with highly personalized, tailored offers that, in turn, lead to higher ROI.

Identity resolution has become increasingly important for marketers as people move across devices — mobile phones, desktops, connected TVs — throughout the day. Identity resolution can help marketers understand that Mobile User A is the same person as Desktop User B. Without that understanding, marketers aren’t able to control messaging to users as they progress through the customer journey on different devices and that’s where identity resolution can help.

It works by reconciling all available data points, which include those collected by first-, second- and/or third-parties. A composite is built that provides marketers with a cherished 360-degree view of a customer’s identity and user journey, and enables an insight-informed, data-driven “single-customer view”  — also known as people-based, or user-level, marketing.

Marketers use a number of tools and platforms to reconcile users’ identities, including simple customer relationship management (CRM) systems. In 2018, the martech landscape saw a proliferation of customer data platforms (CDPs)— tools that track user omni-channel behavior across different devices, platforms and channels.

At the center: the identity graph

To identify individual customers, data is plotted against an identity graph. Consumers give consent along their path for various pieces of marketing technology to collect, process and analyze data such as device ID, email addresses, phone numbers and cookie data, in addition to behavioral information such as purchases or website visits. That information is matched to other data in the graph using algorithims and patterns to create a likelihood, or probabilistic match.

Over time, the systems use artificial intelligence (AI) and machine learning to get smarter and make better guesses at matches. When a user takes an action that requires them to verify their identity, such as paying with a credit card, that guess then becomes deterministic — a perfect match.

It’s a mutually beneficial arrangement. In exchange for that information, brands provide customized experiences that are more relevant and useful to the consumer, a convenience that some studiessay is worth it even for those who are concerned with privacy.

Walled gardens such as Facebook have their own identity graphs, as do data management vendors, leading some of the industry’s leading demand- and supply-side platforms to formthe Advertising ID Consortium in 2017.

Data laws threaten the ID graph

Strict restrictions governing the use of personal data, such as Europe’s General Data Protection Regulation (GDPR), the soon-to-be implemented California Consumer Privacy Act (CCPA) and potential upcoming federal legislation, might throw a monkey wrench into companies’ ability to collect and use second- and third-party data.

Signal CEO Mike Sands, whose company provides such a solution, says that these laws provide “a strong incentive to invest heavily in first-party data that brands can own and operate with users’ consent.”

“Making a strategic pivot away from third-party data toward first-party data also puts brands on better footing in the fight against Amazon and other industry disruptors (e.g., direct-to-consumer upstarts) with vast troves of first-party customer insight,” Sands said, though he believes that second-party data still has a future in ID resolution.

“Second-party data is a different story,” Sands said. “Because it brings together first-party data, it is unique and high quality: not everyone can access it. While brands have chosen for decades to participate in data sharing agreements and data co-ops, emerging technologies are taking second-party data to the next level while addressing the privacy and security concerns that historically deterred many marketers from utilizing these other options.”

What’s the future of ID resolution?

Mara Chapin, digital and social media specialist at Massachusetts-based Market Mentors, says that privacy challenges could force marketers to rely on other customer analyses in addition to identity resolution.

“Due to the regulations over the past year and the reduction of second- and third-party data, a lot of the targeting options and interest-based information have been taken away from marketers when building out their marketing strategies,” Chapin said. “This has required us to learn more about consumers’ behaviors and work harder on our creative in order to accurately target the right markets and make sure the users we want to reach will be the ones who click and convert into a sale.”

“In the future,” Chapin said, “we’re going to start focusing more on user intent rather than geographic-, demographic- and interest-based targeting in order to build our audiences. Instead of having to know personal information that regulations are being built to protect, we will rely more on what people are looking for rather than what they like.”

Sands doesn’t think ID resolution is going anywhere.

“I do not envision identity resolution giving way to rival marketing solutions — if anything, it’s becoming a requisite step at all stages of the customer lifecycle, and I predict it will displace many technologies and philosophies that do not enable the same real-time, continuous engagement,” Sands said.

Chapin ultimately agreed that identity resolution is key to a good marketing strategy. “It’s important in order to reach the proper audience in your marketing messages, whether it’s through the latest digital offerings or in your traditional advertising placements,” Chapin said. “Knowing who your audience is and being able to segment your buys to those targets is the best way to use your budget and overall marketing strategies effectively.”

This story first appeared on MarTech Today. For more on marketing technology, click here.

 

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Want to create better experiences and brand loyalty? Lean on your data

For 2019, marketers will need to increase efforts at data consolidation to allow truly effective multi-channel strategies.

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Marketing leaders are in the throes of 2019 planning and there’s no doubt improving consumer experiences is among the top priorities for the new year. Data shows consumer expectations (and frustrations!) are on the rise, and brands are scrambling to understand to deepen brand-to-consumer engagement. This article will explore three ways brands can make the most of data to improve consumer relationships.

Understand that consumers are evolving, and grow with them

Recent data from a global study which polled 7,000 consumers shows a third of consumers expect brands to anticipate their needs before they arise, and a whopping 70 percent of global consumers are annoyed when every company correspondence is about making a sale. Likewise, Accenture reports 75 percent of consumers are more likely to buy from a retailer that recognizes them by name, recommends options based on past purchases, or knows their purchase history.

Now more than ever, consumers expect brands to understand them and treat engagements as evidence that they are committed to knowing them better as individuals. Whether it be through recommended products, engagement channel preferences (like social media or email), more relevant content (back to school tips or downsizing advice for empty nesters) or selecting better promotions (free shipping versus bundle deals versus free sample products), brands will benefit from going the extra mile.

Glossier is an excellent brand example of evolutionary marketing. In an extensive feature on its founder, Emily Weiss, Entrepreneur Magazine wrote:

Her customers lived on social, and her products are visual by design, which meant that, with the right tools in place, sites like Instagram could become Glossier’s R&D lab and marketing platform…the company began using Instagram to build mini focus groups and quickly create products based on what they learn.  

Make data-driven marketing strategies a consistent reality

According to six months’ worth of database, customer and engagement research, Forrester Research found that “‘data-driven marketing strategies are the new standard.” According to Forrester, “B2C marketers are collaborating with CRM teams to optimize customer relationships. Customer database and engagement agencies have used this opportunity to carve out a spot for themselves on agency rosters by keeping databases secure and compliant with global regulations, as well as creating real-time insights for marketers to act on.” The industry is seeing more proof that data-led strategies are working, but that doesn’t come without its challenges.

Many marketers find critical data is spread widely across various platforms. Sixty-nine CMOs from the likes of Tacori, Fidelity Life, Office Depot, recently shared their challenges in a study conducted by The CMO Club, with 42% of them citing customer data management as the most difficult aspect of marketing technology. For 2019, marketers will need to increase efforts at data consolidation to allow truly effective multi-channel strategies.

One such success story is Opel. The 110-year-old German automobile manufacturer, which prides itself on product and service innovations, looked to marketing technology and data to strengthen its pipeline. Ultimately, by developing a data model tied to a specific goal, the company’s prospect database grew 30 percent in four months, while the number of identified profiles increased over 473 percent.

Look at data as an opportunity by working backward from a goal to determine which data sets are meaningful. Intentional, focused data collection, consolidation, and output is possible when marketers are working to uncover customer trends and opportunities. Here are a few tips:

  • Create an audit of data collection methods and management systems. This focus allows you to truly understand what systems people use and how they use them.
  • Apply industry standards for your business and create data consolidation plans accordingly. This should be a fundamental driver of systems designed to collect, manage and store data for both short term and long-term basis.
  • Know the privacy laws of your state and country. For those companies managing personal information of Californians, the California Consumer Privacy Act of 2018 (CCPA) requires that certain data be available on demand as of January 1, 2020.  Legislation like this should be incorporated into your data consolidation strategy.

Experience is everything

CMOs know how critical it is to improve relationship marketing, with 62 percent of marketers noting it is the most important (or one of the most important) functions of their team this coming year. Of course, communication and engagement is a big part of that, with two-thirds saying their top marketing automation goal for 2019 is to speak to their customers in a more relevant way. That sentiment is echoed by an Adobe report: 33 percent of retailers cite “targeting and personalization” among their top three tactical priorities for the year ahead, higher than for any other marketing tactic.

So how does a brand build both the communication channels and experience they seek?  Here are a few things to consider:

  • Ensure sales and customer service teams are properly aligned: Nothing irritates a person more than being solicited to buy a product they’ve already purchased (or hated and returned). There are many opportunities for customer feedback and service requests to inform which marketing strategies are working or not. Be sure your customer service department is a part of marketing and campaign conversations – they’ll have real-time insights that are worth hearing.
  • Lead with your values: Digital marketing can be a double-edged sword. There is enormous value in connecting via multiple channels with your customers and learning more about them through data, but brands that don’t honor consumer preferences ultimately fail because their values are being compromised in favor of potential sales.  And, let’s face it, if you don’t respect things like opt-out requests or address poor consumer experiences, customers will melt away like post-Christmas snowmen.

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