Identity Resolution Gets in the Way of Customer Centricity

Shoptalk’s theme this year was customer centricity. Putting the customer at the center can be a big challenge for brands. The first issue many companies run into is competing priorities. A retailer that needs to clear excess inventory before the next shipment feels the pressure to push clearance messaging even if a customer-centric strategy would dictate that some people will deliver higher lifetime value if they get a different message. Many brands find that they're in a kind of “customer centric sometimes” state, which enables other priorities to overrule, for better or worse.

The next challenge is technical. Being “customer centric” requires a lot of readily available, accurate and real-time customer data. Most companies don’t have that today. Instead, they have a hodge-podge of disparate data in various states of accuracy and recency that are not all compatible with each other.

Interestingly, our research shows that a lot of companies pushed ahead over the past few years with customer-centric marketing technology even though their data foundation was unsteady. When we analyzed more than 700 conversations we had with brands, the biggest issue they cited when it comes to creating a great customer experience is identity resolution. Most of the time, brands don’t even know who they're talking to because they can’t identify them.

The Problems Behind Identity Resolution

Brands have invested millions in marketing automation, loyalty, personalization, cross-platform orchestration and other tech to deliver awesome experiences for customers, and are now waking up to the harsh reality that even the most sophisticated technology follows the “garbage in, garbage out” rule. If the data is no good, then the campaign isn't going to deliver the relevant customer experience brands are hoping for.

Often, brands have some good data, but suffer from some combination of three major identity resolution issues:

Related story: Identity Resolution is Holding Marketers Back From Better Performance

• not having privacy-safe data collection in place where it needs to be;
• having disparate data stored in a format that can’t easily be activated; and/or
• too many interactions where people are not identified.

If a company has insufficient customer data or low identity, it’s often not for lack of trying on the marketer’s part. Some companies have restrictions on data collection, limited budgets to invest in data infrastructure, or legacy technology that’s in place for another important reason that's hard to rip out. Other brands suffer from investments in data that aren't as agile as they need to be in the age of artificial intelligence. Consider a centralized first-party customer database that's hard to integrate with third-party data or a customer data platform that isn’t compatible with newer e-commerce or marketing tech. The pain is real.

Solving Identity Resolution in Big and Small Ways

Some brands are investing in identity resolution partnerships that can clean their data, merge it and format it so that it can be activated across tech platforms. For example, Dr. Martens recently announced it was working with Amperity for its “AI-powered identity resolution and insights to scale data maturity while ensuring privacy compliance.” That’s a big investment and a big project that should help Dr. Martens' overall customer centricity, especially across marketing and e-commerce, but not every marketer gets the green light to undertake such a strategic investment.

Brands wanting to be customer centric without the ability to invest in comprehensive identity resolution can turn to their current partners for help in smaller or more channel-specific ways. Marketing automation companies like Braze can help retailers identify shoppers on site to make up for a low number of logged-in users. This allows brands to personalize the shopping experience. Other marketers are tapping identity resolution companies to resolve specific datasets, such as mobile and web data, to create a single unified set of insights. Axciom, LiveRamp and many other data companies provide ad-hod identity resolution to companies where they need it most. The newest approach is to use AI-based identity resolution. Startups like Hightouch are flexible and modular, with efficient data management and sophisticated personalization.

Achieving identity resolution across every customer interaction is unlikely, but improving identity rates even a little can help marketers deliver much better customer experiences. Therefore, the effort is worth it even if a solution isn’t perfect. With so many brands already invested in expensive technology stacks, the right approach almost always requires some kind of compromise. Even for a company ready to invest in an overhaul, the promise of AI could pan out and deliver dramatic improvement over mainstream solutions today, so some brands are using a patchwork of smaller identity resolution options now as AI matures. Treating identity resolution as a journey and looking for small wins along the way is a realistic strategy that can help brands get closer to customer centricity.

Lane Barnes Genee is head of brand development and vice president of marketing at Alium.io, a platform that helps brands find the right martech and e-commerce solutions.