Welcome to the privacy-first world.
Privacy must now be our default setting — whether that’s due to third-party cookie deprecation, restricted access to mobile IDs, changing regulations, or simply a growing expectation that we’ll use people’s data responsibly.
This inevitably restricts access to third-party audiences. So, it’s important to expand your pool of rich, first- and second-party data to power reach and personalization. Building digital resilience and filling the hole left by third-party data means you can still reach the people behind the devices with relevant marketing.
Data technologies — and more specifically customer data platforms (CDPs) and data clean rooms — are a great place to start. While CDPs help you gather and manage more first-party data, clean rooms move you into the second-party zone. They enable collaborative and secure data sharing to reach potential customers you wouldn’t otherwise have access to.
CDPs Are In It For the Long Haul
With revenues likely to hit $1.6 billion this year, the CDP is a well-established technology that ingests and unifies first-party data from multiple places to deliver a coordinated customer experience. To achieve this, CDPs use personas with individual attributes and other rich data to paint an up-to-date customer portrait.
There are over 100 CDPs to choose from but they all have something in common. They are designed to gather data and make it intelligent and actionable. This puts them in the perfect position to build digital resilience by collecting and nurturing your most valuable asset, your own customer data.
Data Clean Rooms Are the New Black
Data clean rooms aren’t new, but have only recently come to the forefront of the martech landscape. They build digital resilience by enabling second-party data exchange, giving you direct access to audiences you can no longer reach through third-party channels.
You may realize you need a data clean room without being quite sure what to use it for. This isn’t helped by most vendors only providing the infrastructure to build clean rooms, rather than packaged solutions with clear business value.
One common use case for clean rooms is a kind of overlap analysis, where customer data is shared for co-marketing. Imagine an airline brand and a hotel brand. Given they operate in the same sector but aren’t competitors, matching loyalty program data makes sense. Each brand can reach the other’s top customers with incentives and upgrades. A clean room is a safe, neutral environment they can use to exchange data without handing over customer lists. They could even join forces with a car rental company to further expand the data and value exchange.
By getting creative and working with partners and affiliates, clean rooms provide a solid alternative to third-party cookies, enabling you to reach otherwise inaccessible audiences. It goes without saying, any data exchange of this kind must be clearly communicated to your and your partners’ customers through your privacy policies.
There’s Always Room For Improvement
So there you have it. CDPs and data clean rooms help you use first- and second-party data to replace cookie-based third-party data and build digital resilience.
But here’s the thing. CDPs and clean rooms are important tools in the toolbox, but you still need to know how to use them effectively. Making the most of these technologies isn’t just a case of buying the software. And, since not all solutions are created equal, functionality gaps can impede your overall marketing objectives and ROI. You may well need additional support to optimize their capabilities.
Identity is one key area of weakness for CDPs. They create identities via customer interactions and stitching behavioral data across connected channels. But this simplistic approach to creating a single customer view is often incomplete and inaccurate, undermining their performance.
The basic concept of householding, for example, is alien to most CDPs. This leads to marketing execution that ignores the overall opportunity spend in a category, lifestage considerations, and lifestyle factors that may be vital to maximize MROI. The result is ad bombardment that is incongruent and misdirected. You can overcome these challenges by using outside identity resolution technology with enriched personas to increase customer intelligence accuracy.
Privacy is another area CDPs may need a little assistance. They are set up to manage user consent but won’t necessarily support data governance, so optimization is needed to navigate privacy concerns and evolving regulations. Finally, there may be core data management and analytics gaps to fill. You might need to augment the CDP’s limited capabilities so you can onboard clean data that counters the “garbage in, garbage out” effect. And you may need additional analytic technologies and data science capabilities to perform deep analysis beyond simple dashboard views.
Data clean rooms may be the new kid in town, but they share many of the CDP’s shortcomings, and there are ways to optimize them, too. This might mean using identity graphs to improve data matching between partners, rather than just stitching hashed emails and device IDs. Or it could mean bringing in additional data-privacy governance and tools to minimize risk for both parties.
Both CDPs and data clean rooms help you reach and engage valuable audiences without third-party cookies. But only if you understand what you’re trying to accomplish, and can wrap their shortcomings with privacy-by-design, identity, data management and analytics capabilities to achieve marketing objectives. Leaning on the right expertise makes optimizing CDPs and clean rooms far easier than tackling the task on your own, and helps you build digital resilience for the privacy-first world.
Learn more at acxiom.com.
Mike Danley, Director of Product at Acxiom, is a 20+ year marketing technology veteran who is passionate about helping brands solve data-driven marketing problems by combining data, technology, ethical data practices, and creative ideas that empower marketers to deliver better customer experiences and growth. Mike now leads Acxiom’s data management and digital transformation solutions that deliver foundational customer intelligence for brands connecting adtech and martech at the data layer.