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The Role Of The CDP In Personalization In Both Known And Anonymous Environments

  • Written by  John Nash, RedPoint Global

0aaaJohn Nash RedPointGlobalFor years, retailers have relied on various systems to store their shopper data and insights — from endpoint engagement systems to data management platforms (DMPs). Many of the systems were for a particular channel and in the case of digital advertising, DMPs enabled a basic level of segmentation. However, with customer data now exploding at a rapid rate, retailers must take a unified approach to understanding everything possible about individual consumers to personalize engagement in any environment.

The challenge for brands is how to satisfy the consumer demand for consistent personalization across every channel and touch point, both in addressable and non-addressable channels. Brands no longer have the luxury of waiting to deliver a personalized experience until the customer appears in an addressable channel. New capabilities are required to deal with decentralized data, anonymous environments and personalized marketing at scale.

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Recent research found that 37% of consumers will not do business with a brand that fails to offer a personalized experience. Moreover, 31% report being “very frustrated” when a company doesn’t recognize them as an existing customer. For this reason, personalization should not be left to whim. Just one frustrating experience for a customer could undo even the best efforts of personalization and end a relationship. For example, a relevant email offer in pitch-perfect sequence with a customer’s shopping intent will be offset if it’s followed by a mobile message that is irrelevant or, worse, in conflict with the previous offer.

Changing Role Of The DMP For Anonymized User Data

The reputation of the DMP as a primary source for consumer data for use in the AdTech ecosystem has been in steady decline for some time. However, two recent trends helped to accelerate its demise: new restrictions on web cookies and an increased ability to anonymize data from a customer data platform (CDP).

DMPs can handle first- and third-party data, which led to the misconception that they can serve as a customer engagement system of record. However, it is only a subset of data and it’s all anonymized. Further, DMP measurement capabilities can give advertisers a broad sense of what is happening with online messaging — but that’s only half the picture. Marketers want to know how their advertising is performing as well as its impact on offline behaviors and transactions.

A DMP can provide cookie-based information about consumer audiences via demographics or metadata that may help retailers understand which macro-level segments are interacting with their brand. DMP’s also fall short of offering advanced analytics, so for sophisticated digital marketers, a DMP at its best will simply serve as another data source for CDPs. Enter the Anonymous CDP (aCDP).

Anonymous CDP: How It Works

Retail marketers can now bring the disciplines of direct response marketing to digital paid media though advanced CDPs that can manage and interact with anonymous data. Brands use a CDP to define audiences for targeting and suppression. Then, within a single UI, they onboard audiences for activation across the AdTech ecosystem. Post-campaign data is then brought back into the anonymous CDP for measurement, analysis and insights into offline behaviors such as store visits, purchases or other interactions.

An aCDP is fully compliant with privacy regulations with strict controls that prevent the re-identification of anonymized data. Brands can also rely on aCDP data to personalize experiences for first time, anonymous traffic to their own web site. With aCDP that can personalize in addressable and non-addressable channels for both known and unknown consumers, marketers manage and optimize revenue growth from both AdTech and MarTech environments.

From a digital paid media perspective, a CDP provides superior audience segmentation — an important buffer against the significant problem of ad fatigue. An enterprise-grade CDP accomplishes more granular audience segmentation than a DMP while maintaining privacy compliance by keeping PII and anonymized data separate and distinct.

Having the ability to customize digital advertising content based on anonymized records of actual consumers enables enterprise-grade CDPs to deliver personalization in a way that appears seamless to the consumer. Bridging addressable and non-addressable channels while remaining fully compliant will transform customer relationships and foster loyalty.

Brands rely on a CDP to add the data ingestion, standardization and identity matching that are key to a brand’s ability to deliver a real-time personalized experience in the context and cadence of a customer journey. In owned channels, CDPs give marketers the single point of control necessary to manage and optimize customer journeys across all touch points.

Today’s customers (in the retail industry or otherwise) demand seamless, highly personalized customer experiences with a real-time cadence, and DMPs simply aren’t built for that purpose.

Personalization Can’t Wait

From the customer’s perspective, seamless personalization across addressable and non-addressable channels reduces friction and enhances loyalty. A first-time visitor to a web site presented with personalized content has a higher propensity of becoming a second-time visitor. Brands that extend consumer insights gained from their CDP into the anonymous ecosystem not only reduce waste and improve relevance, they’re also rewarded with the profitable growth that comes from loyal customers.

Personalized marketing in today’s complex ecosystem has its challenges, but the challenges do not outweigh the customer’s expectation for personalization across a dynamic customer journey. Taking the easy way out by waiting to deliver personalization until a customer appears in an addressable channel is no longer tenable in an environment where the consumer has control over their own journey and expects it to be uniquely tailored to their preferences and interests.


 

John Nash has spent his career helping businesses grow revenue through the application of advanced technologies, analytics, and business model innovations. As Chief Marketing and Strategy Officer at RedPoint Global, Nash is responsible for developing new markets, launching new solutions, building brand awareness, generating pipeline growth, and advancing thought leadership. Connect with Nash on LinkedIn.

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