U.S. marketers are expected to invest $2.6 billion in identity resolution programs by 2022 — a 188% increase over the course of four years, according to a Winterberry Group forecast. The growing investment underscores the function of identity programs in marketers’ customer experience and people-based marketing initiatives.
Identity resolution — the process of connecting unique customer identifiers to a single, unified customer identity — is the key ingredient for marketers seeking to create hyper-personalized experiences across all customer touchpoints. But the onset of user privacy regulations, combined with dwindling third-party cookie data, poses significant challenges for marketers wanting to build successful identity programs. So what’s a marketer to do? The first step may be taking greater ownership over your ID graph (the platform that feeds your identity resolution efforts) and your customer data.
ID graphs and identity resolution platforms
Before we dig into the challenges, let’s take a step back and overview exactly what an ID graph is and how it’s connected to identity resolution. At the most basic level, an ID graph (short for identity graph) is a platform where the “unique identifiers” that make up customer data are collected — device IDs, email addresses, phone numbers, cookie data, transactions, etc. Identity resolution platforms can help match data within an ID graph to customer IDs in CRM and customer data platforms (CDP) to create targeted campaigns, personalized messaging, attribution models and more.
There are two kinds of ID graphs: public and private. A public identity graph is built primarily on third-party relationships via cookied data and data collected across various platforms and websites. And while these have definitely served marketers in the past, public ID graphs will likely become less effective as browsers crack down on cross-site tracking via third-party cookies. “Going forward, the pool of high-quality matches available will become increasingly scarce as third-party cookie linkages get blocked and sources of third-party identity creation dry up,” according to a Merkle report.
A private ID graph is owned by the marketer and created using PII-based (personally identifiable information) customer data. “PII-based records that sit in the CRM organization are linked with digital identities, such as first-party cookies and device IDs from website, app visits and media exposure,” says Merkle.
Using a private ID graph versus a public graph allows marketers to have more control over the data being collected and the ability to customize the platform to fit their unique needs, resulting in more effective identity efforts.
Identity resolution obstacles
As an emerging technology, identity resolution platforms were often used by marketers to segment and target their audiences. Identity martech tools helped advertisers build customer profiles that allowed them to connect the dots across channels and devices, creating one-to-one marketing experiences. Now, with marketers taking more ownership over the customer journey, identity programs have evolved. In addition to targeting and segmenting, marketers are implementing identity resolution programs for a number of activations, including customer insights, measurement, attribution and personalization.
Still, brands are grappling with their identity efforts. Seventy-one percent of marketers surveyed by Forrester last year said they struggle with the ability to maintain accurate customer IDs over a period of time and effectively track changes in customer behavior.
Only half of the more than 200 marketers surveyed said they are “fully capable of fundamental identity resolution capabilities.” In other words, half are unable to identify customers across devices, control communication frequency and sequencing or build a single customer profile using all available data.
The 2018 Winterberry report found that only 15.3% of the 400 brand marketers surveyed could identify their audiences accurately and consistently.
Customer data management challenges is a common theme. Just 38% of customer data management executives know where all of their customer data was stored, according to a September Forrester report. More than a quarter of marketers surveyed by Gartner cited technology as a key obstacle in their personalization efforts. Not only are marketers in the dark when it comes to identifying their data sources, many lack the necessary martech needed to take full advantage of the customer data they do have.
The solution: Greater ownership over identity platforms and data
To overcome identity obstacles, marketing organizations are looking to take more responsibility over how identity data is managed and more ownership of their identity resolution platforms.
Considering the complexity of identity strategies among marketers, a one-size-fits-all tech approach is likely to fail. “As no single supplier has all of the data, technology and process infrastructure required to support all marketers’ diverse needs,” says the Winterberry Group, “the responsibility for identifying overarching customer engagement strategies (and selecting solutions that best support those objectives) is always vested in the marketer.”
For many marketers, having the talent and resources to build an in-house identity solution that relies on private ID Graphs and first-party data may sound unattainable. To start, marketers should commit to getting buy-in from the C-suite. “Identity must be a well-funded and executive-supported initiative,” according to Merkle, “It must have a clear owner who sits closest to functions such as data science and customer analytics, modeling and measurement.”
It’s also critical to have a cross-organization effort that addresses identity data, needs and capabilities across departments. A key challenge is often getting alignment across business units. “Knowledge, insights between different analytical resources don’t get shared,” a senior customer experience director told Forrester. “It’s like we’re trying to solve the same issues, but have different ways of doing it; we definitely need more universal access and communication.”
By taking ownership of their identity initiatives — and full responsibility of the platforms and data that enable identity programs, marketers will gain a deeper understanding of their customers and gain more control over their first-party data activations. Getting there takes leadership and organizational buy-in and long-term commitment.