How brands can turn first-party data into practical insights

The value of first-party customer data is ever-increasing as the impending death of third-party cookies limits the pool of customer insight that brands can tap on to deliver the personalised experience that their customers demand. 

62% of consumers worldwide expect personalisation, according to Twilio's State of Personalization Report 2022, saying that a brand will lose its loyalty if its experience is not personalised.  

Within Asia Pacific, the report found that as much as 78% of brands in Asia Pacific and Japan rely on third-party data for current marketing strategies. 

Through support touchpoints, brands can prepare and move away from third-party data dependencies by capturing customer interactions and tuning into their consumer market's directly-expressed needs, interests, and concerns.  

Malcolm Koh, global director of Zendesk's customer experience practice, explains these support touchpoints add a layer of personalisation that goes beyond superficial data points to truly understanding them.  

"Staying on the pulse of customer expectations also allows businesses to translate insights into actionable trends, ensuring they consistently deliver the best brand experiences," he tells Campaign Asia-Pacific. 

The role of CRMs and CDPs

Customer relationship management (CRMs) and customer data platforms (CDPs), for example, are two of brands' most common first-party data sources. The main difference between them is that CRMs organise and manage customer-facing interaction, while CDPs collect data on customer behaviour with the brand's product or service. 

CRM data will give brands a client's name, history of interactions with the sales team, and support tickets they have filed, among many other things). On the other hand, CDP data can tell brands each step a customer has taken since engaging with them, from the channel they found the brand on to how they behave within the brand's product.  

Ultimately, first-party data, whether from a CRM or CDP, is invaluable in creating compelling experiences.  

Katrina Wong, vice president of marketing for Twilio Segment, says first-party data allow brands to understand their customers with an unrivalled degree of clarity and precision, as it depends on direct customer interactions across various touchpoints. 

The process is sales assisted, whereby brands use the first-party data for audience retargeting through advertisements and during sales. 

"Every day, the average person is inundated with marketing tactics across different physical and digital touchpoints. In a landscape characterised by an overload of information, first-party data helps businesses understand their customers more precisely than any other source, ultimately creating personalised experiences that customers appreciate," Wong explains to Campaign Asia-Pacific. 

"The decline in the use of ad identifiers and the imminent death of third-party cookies creates an opportunity for marketers to favourably steer towards a customer-first approach, prioritising customer privacy at the centre of their decisions. We have found that 69% of APJ consumers want brands to do more to protect their privacy and be transparent about data usage," she says. 

Transforming first-party data into actionable insights

Data collected from CRM benefits customer-facing departments in brands such as marketing, sales, and support.  

By studying the first-party data, these departments can analyse, improve and accelerate their outreach efforts through more informed decisions, or identify opportunities for the business to connect and curate engagements based on customer needs and preferences. 

This data allows them to refine customer profiles, segment them more granularly, and then act with truly personalised ads, messages and offers, explains Wong. 

She notes that while CRMs mainly store first-party data on customer transactions and sales, CDPs, on the other hand, provide a more compelling customer experience. CDPs do this by unifying customer data from various sources to fully understand customers and what they look for across different channels.  

For example, rather than feeding an advertisement on a pair of shoes to a customer who has purchased it in-store, CDP collects digital signals and recommends outfits that match the shoe purchased instead. It essentially serves as an extension through product recommendations based on past customer actions. 

"Considering that six out of 10 shopping journeys begin online, CDP makes it possible for businesses to drive compelling customer experiences through precise individualisation without blind spots," she says. 

"Comparing the two systems, a typical CRM system is only updated every 24 hours. Hence, it does not accurately reflect real-time interactions for ad retargeting by marketing teams." 

Benjamin Soubies, managing director for APAC at Talkwalker, observes that marketers today have access to tons of information, especially since brands have accumulated millions of data points. However, a majority of that data in companies is untapped.  

He says there is much more they can do with that data, but they may not have the processes, mindset, or tools to understand it. In addition, brands need to know who will be the department that understands that data, whether it's marketing, product or support. 

"Whoever it is, needs to leverage and tap into that information to get insights. We are seeing more clients trying to make sense of data around their customer reviews as they want to understand what people are saying and how it will impact the brand," he explains to Campaign Asia-Pacific. 

"That is where using first-party data such as CRM to understand the data comes in. Leveraging AI, all the different tickets from the customer support team that would go into a CRM platform or customer support software can quickly merge. From there, marketers can understand the main issues and how much time they need to tackle them." 

Building trust with data

As the scrutiny on data privacy continues to intensify in the digital consumer landscape, brands face a significant challenge in getting their customers to trust them in handling their data 

Gone are the days when customers blindly trust that a company will protect their data. Twilio's State of Customer Engagement Report 2022 showed that 95% of B2C companies believe customers trust their data, but only 65% of customers agree.  

In addition, 69% of APJ consumers want brands to do more to protect their privacy and be transparent about data usage. 

"We call this the personalisation-privacy paradox – while most customers expect personalisation, less than half (40%) say they trust brands to use their data responsibly and keep it safe," says Wong. 

"Balancing this paradox will be a significant challenge for businesses but still manageable. For starters, companies need to emphasise data transparency strongly – this includes allowing customers control over what, where and how their data is used can help redefine customer relationships. They should also constantly make customers aware of their value in exchange for their personal information." 

John Zissimos, chief marketing officer at Okta, adds customer identity and access management (CIAM) solutions are one way in which businesses can build trust with data.  

As CIAM sits at the intersection of security, customer experience, and analytics, it provides a frictionless way for users to onboard and log in, critical for driving conversions and building customer loyalty.  

"CIAM can help organisations leverage their knowledge of the customer to build more relevant, higher-converting digital experiences. The right CIAM solution enables a complete, 360-degree view of customer profiles and preferences by consolidating and centralising user data across various sources, including internal and third-party systems," he explains. 

"This unified view provides a better understanding of who your customers are and what they want so that you can tailor your outreach and campaigns for a more effective marketing strategy." 

Data interoperability

With customer interactions increasingly growing more digital over the past two years, brands have been scrambling to get on every digital touchpoint that their customers use and interact with daily. 

While a multichannel approach is a good idea, it often creates data silos and disjointed customer experiences. Instead, brands need to invest in creating omnichannel experiences that provide continuity and personalisation for consumers, no matter where they decide to interact with the brand. 

To make an omnichannel strategy a reality, businesses need to embed a scalable data infrastructure into operations to centralise customer data and act on it in real-time. Embedding a scalable data infrastructure into processes creates hyper-personalised experiences based on customer demographic, interests, and behavioural data. 

Ultimately, data is not static and is constantly changing. Hence having multiple isolated databases requires more time and menial backend work for updates. To this end, data management systems can help integrate and unify these data silos to allow for optimisation. 

CDPs, in particular, have become pivotal in the quest to uphold privacy while simultaneously making customer engagement more personal. CDPs allow for behavioural retargeting of anonymous prospects, with businesses only able to show ads to consumers collected by their first-party data. 

Brands must find solutions to consolidate data from all different sources into a single view, so all teams can easily retrieve the data they need. For example, they can share data between two CRM platforms. 

Wong explains CDPs allow brands to configure APIs for each website to that they want to send data. In addition, companies can add data from offline sources, such as CRM, apps, support tools, etc.  

Brands that configure APIs for each website and add data from offline sources result in personalised ads being shown without compromising the user's security, thus solving the privacy-personalisation paradox. 

"Different teams can now view the full scope of customer data that could be used for informed decision-making. In addition, information will always be up to date, and teams no longer have to manually import and export data each month, which takes up time," she adds.