Despite all the hype around customer data platforms (CDPs), a new study has found brands are struggling to create a unified view of customers. The study, conducted by Forrester Consulting and commissioned by Oracle, Getting Customer Data Management Right, found brands want to unify customer data, but face significant challenges in bringing different data types together.
Forrester said unified customer profiles deliver on marketing priorities, and customer profiles support customer-focused operational priorities like improving the use of data and analytics, personalisation and content marketing, as well as customer-focused business priorities, helping to align brand promise with CX and developing new products and services.
As marketers know, brands which leverage unified customer profiles effectively are more likely to experience revenue growth, increased profitability and higher customer lifetime values. The report states brands using CDPs effectively are 2.5 times more likely to increase customer lifetime value.
It seems 75 per cent of marketing and advertising professionals believe the ability to improve the experience of customers is a critical or important objective when it comes to the use of customer engagement data. Around 69 per cent believe it is important to create a unified customer profile across channels and devices, and 64 per cent stated they adopted a CDP to develop a single source of truth so they could understand customers better. Plus, 69 per cent expect to increase CDP investments at their organisation over the next two years.
Forrest reports leading firms are 3.3 times more likely than emerging firms to significantly increase martech budgets in the next 12 months and use their CDPs at higher rates across all marketing use cases, are 1.4 times more likely to recognise driving customer centricity as an important or critical priority in the next 12 months, 2.5 times more likely to prioritise seamless cross channel customer experiences, 1.3 times more likely to have realised the ability to scale consistent, relevant customer engagement and experience across touch points and channels, 7.9 times more likely to see a revenue increase of more than 10 per cent year to year, and 2.6 times more likely than emerging companies to see increased business results, such as profitability, as a result of their unified data management. Finally, they are 2.5 times more likely to enjoy benefits, like increased customer lifetime values.
However, it seems only 11 per cent of brands can effectively use a wide variety of data types in a unified customer profile to personalise experiences, provide a consistent experience across channels, and generally improve customer lifetime value and other business outcomes.
“A solid data foundation is the most fundamental ingredient to success in today’s experience economy, where consumers expect relevant, timely and consistent experiences,” said executive vice president and general manager, Oracle CX, Rob Tarkoff.
The report recommends marketers help their firms achieve broader customer analytics maturity by working with their business technology counterparts on key competencies for rich customer insights, including: A strategy to position customer analytics for insights-driven decision making; structure the customer analytics team to either build skills in-house or develop successful external partnerships; focus on data quality, quantity and integration; use analytics tied to business and financial metrics; a process to generate, disseminate, and apply customer analytics insights; and technology to produce, distribute and activate analytics.
Its final recommendation includes: Don’t conflate a strategy with a platform; collaborate across the business with leadership buy-in; pinpoint useful data sources and invest in identity resolution; enrich customer profiles with actionable intelligence; build trusted relationships based on value exchanges; and define and track customer-centric metrics.
Forrester Consulting conducted an online survey of 337 professionals in North America and Europe who are responsible for customer data, marketing analytics, or marketing/advertising technology. Survey participants included decision makers director level and above in marketing or advertising roles. The study was completed in September 2019.
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