All marketers know the challenge of really understanding your customers. With so much data now available, making sense of it to gain a full view of every customer’s preferences is a struggle. However, there is an answer, and it lies in the form of a collaborative effort between brands and retailers.
The current challenge for brands that interact with a customer across numerous platforms is the build-up of multiple identifiers for each single real-life human being. According to Gartner, more than 90 per cent of marketers struggle to seamlessly connect more than three channels on the buyer journey.
However, brands should not be suffering in silence, and marketers must double down on their commitment to be responsible practitioners. Help is at hand in the form of retailers, who often know more about customers than the brands themselves. These collaborations are known throughout the marketing industry as second-party data partnerships.
Second-party data is simply another organisation’s first-party data, shared between brands and retailers to enable better data-driven marketing. The technique is becoming increasingly popular and by next year, the use of second party data is expected to grow by 26 per cent to be used by 64 per cent of all advertisers.
So how do brands and retailers make the most of the data gold mine they’ll be sitting on? It’s all well and good having this customer intel but knowing how and when to act upon it is key. Like with any campaign, trial and error will be paramount to understanding what works and what doesn’t to give marketers peace of mind when it comes to embracing creativity.
When evaluating potential second-party data partners, marketers can ensure the data is ethically sourced by following these best practices:
The experience is essential
All marketers will know that customer data always comes with rules - it’s not a straightforward and seamless process. Not only must marketers aim to meet their customer expectations, they must also be aware of these expectations when it comes to their data and how it is used for marketing purposes. It is fair to say that some customers aren’t always fully aware of how their data is being used for marketing purposes. However, action has been taken by the implementation of General Data Protection Regulations (GDPR), which ensures there is full transparency and the option for customers to opt in or out of communications. Of course, there is still room for improvement from marketers on this front.
What is a second-party data partnership and why is it important?
In order to form a successful second-party data partnership, it is crucial that marketers always renew the privacy policies that were present at the point of collection as well as defining how, when and where the data can be used to support their privacy. To avoid disputes, it is also key that customers are provided with adequate notice and opt-out choices – performing actions like these will also help marketers remain one step ahead of their competitors.
Finding the right retail partner
At a time where customer data is at an all-time high, with internet use dominating the technology industry, retailers are facing immense pressure to compete within all e-commerce channels, while maintaining brand reputation and customer loyalty. Finding the right retail partners can make or break a brand’s reputation, so it is essential that they choose wisely. There is so much to gain for brands when it comes to strategic partnerships, but there is also a lot at stake if they fail to plan effectively. It is crucial that brands do not rush this process by partnering with retailers that aren’t the perfect fit – this will inevitably have a negative impact on brand reputation, particularly when it comes to competition.
GDPR and handling data
Customers and marketers are both operating in a society that is regularly talking about ethically sourcing everything. In particular, marketers are experiencing a trend where reports of unethical data use are a regular occurrence and as a result, they must double down on their commitment to become responsible practitioners. Organisations are rightly adopting more rigorous approaches to data sourcing, in order to gain a well-rounded view of their customers.
Getting creative with second-party data
Creativity is key when it comes to marketing and second-party data. There are several benefits to second-party data - it enables trust and transparency and quality, which have all become the cornerstone of every decision for marketers. In-fact, 54 per cent of consumers said trust is the forefront of their minds when it comes to sharing their personal data. As with any situation, it is important that marketers are always ensuring they are one step ahead of their competition, while living up to customer expectations and providing a seamless experience.
Using second-party data and creativity effectively allows marketers to gain a true understanding of their customers, but doing so in a secure, compliant and privacy-driven way ensures they remain one step ahead of their competitors.
Steve Martin, LiveRamp (opens in new tab)
Image Credit: Oblong Industrites