Despite what some technology vendors may say, achieving a 360-degree customer view is a myth, at least for now.
“A true 360-degree customer view does not exist, but that’s okay,” Gartner stated in its report, What Marketers Need to Know About Managing Identity (registration required).
Gartner’s statement was echoed in Clicktale’s Defining the Digital Experience Report (registration required), a survey of 200 marketing and customer experience (CX) officials.
The survey found:
- 54% of marketing and CX professionals don’t believe they have a strong understanding of their customers’ behavior across their digital channels.
- 34% of marketing and CX professionals are not effective at uniting data from their web and mobile sites.
- 39% of marketing and CX professionals are not effective at uniting data from their websites and mobile apps.
- 71% of brands can’t action customer insights in real time.
- 20% of marketing and CX professionals feel they will ‘never truly understand’ why their customers buy.
Tech Will Get You Close to a Complete Picture
Even without a true 360-degree customer view, companies can come close to it by using some different identity resolution technologies, according to the Gartner report. “Most marketers will employ one or more audience profile platforms to manage identities and attributes. At the same time, they will perform identity resolution and management — often using partners and vendors — for marketing and advertising programs." The commonly used platforms in this area include:
- A data management platform takes data from multiple first- and third-party sources, relying on anonymized identifications, making it privacy-friendly, but also making it difficult to handle some first-party data.
- A customer data platform will take behavioral and identity information from first-party systems, such as point of sale and CRM systems, emails and mobile apps. But these platforms don’t include third-party data that can help provide a more complete view of the customer.
- A customer identity and access management platform captures information about website and mobile app users, but is useful only in managing customer information on owned platforms, and, like the customer data platform, doesn’t provide what can be valuable, third-party data.
So while the above technologies can provide some valuable customer insight, “to date, none of these solutions represents an end state for managing identity,” the Gartner report said.
Related Article: What Customer 360 Means in 2019
Data Is the Differentiating Factor
Robust data can solve the above issues and provide a near 360-degree view of a customer, according to Ken Dickman, EY Global Advisory Commercial Transformation Leader.
“To gather this data, a customer typically opts into your programs and provides you with their identity and base information, and provides you the permission to send them relevant information and offers. Once a basic customer profile is established, businesses can monitor, test, learn and optimize their customer interactions based on the behavioral, attitudinal, demographic and psychographic information found using different data sources and advanced analytics.”
Related Article: Is That New CDP Truly a Customer Data Platform?
But Is a 360-View Really Worth It?
The cost of this data can be high, so companies must determine if attaining a 360-view of the customer is worth the cost and associated ROI, Dickman added. “Attaining and analyzing data from thousands of interactions, across several forms of media and several sales channels becomes costly given the sources of data that need to be integrated into an extensive customer profile."
That said, today’s data and analytic tools enable us to predict — with statistical confidence — what type of communications and offers will have a very high probability of converting to a sale, upsell or cross sell including increasing frequency of purchase. The cost of this investment has decreased exponentially over the last five years and will continue to come down.
“Companies have to understand that attaining a 360-degree view of all their customers is impossible.” Dickman said. “But it is possible to build a 360 view of a representative cross-section of customers — those willing to share their identity and allow you to monitor their purchase behaviors and share information with partner companies.
Dickman added that companies see the biggest ROI when they take three things into account:
- A 360-view of the customer alone does not drive incremental growth. Insights need to be turned into actions to drive increased volume, revenue, profit margin and loyalty. Often, planning and execution teams are left with insights that they are not sure how to act on.
- Best-in-class companies infuse customer insights into cross-functional planning and execution processes to bring insight to action with agility and ease across the organization.
- Aligning metrics across functions allow businesses to turn insight into action without conflicting metrics or incentives hindering the speed of progress.
“Driving a return on the investment relative to the ongoing maintenance and costs associated with a 360-degree customer view requires companies to adjust their ways of working and core marketing processes,” Dickman said. “Without the business, customer experience design, and enabling data, analytics and technology all working in tandem, a 360-view of the customer will not deliver value.”