‘Brands Must Own Customer Data to Survive’
The Chief Executive Officer of Terragon, Mr. Elo Umeh has explained the critical role ownership of customers’ first-party data plays to brands and the exponential value they add in online advertising.
Umeh, who explained this during an interview, stated that first party customer data was the most valuable data businesses own and the starting point for any form of customer engagement.
“Now more than ever, the need for businesses to own and manage first-party data could be the difference between staying in business or going under.
“Customer behaviour is dynamic and ever-changing as well as the landscape within which they operate (for instance the impact of COVID-19). The first step towards understanding and responding to customer needs is through data – to prevent churn and increase lifetime value,” he explained.
First-party data refers to information brands collects directly from their customers or audiences, from various touchpoints such as Customer Relationship Management (CRM) software, actions or interests demonstrated across websites or apps, customer feedback, completed customer surveys, forms, etc. First-party data is usually consented to and so privacy concerns surrounding it is minimal.
Speaking on how some forward-thinking brands are taking advantage of first-party data, the Chief Executive Officer of Terragon said, “Our Customer Data Platform (CDP) was used by a top global FMCG Brand in Nigeria to surpass their target of building a verified database of their customers with 1 million first-party data.
“Owing to the success of the previous target, the brand is currently in discussion with us to grow that database to 4 million this year.”
He added, “A number of top tier banks have also been using our CDP to enrich their first-party database for various levels of customer engagement including cross-selling and upselling their products and they have reported an improvement in returns on their Ad spend.”
Over the years customer journey has become a multi-platform and multi-device, such that their footprint goes across various touch points including desktops, mobile phones, TVs, apps, watches and lots more – thereby creating the need for Advertisers to have a unified view of each customer.
With the help of a number of tracking methods – including the use of third-party cookies, advertisers have been able to collect data and follow customer journeys and tailor ads to suit their preference and interests. However, with customers’ increased attention to data privacy, stricter regulations to enforce compliance and phasing out third-party cookies especially by Google Chrome which tracks over 60 per cent of internet users, the ability to track customers and serve personalised Ads this same way is significantly threatened.
While few solutions are being developed to solve this, the importance of first-party data remains a common consensus; giving rise to the importance and need for a software to aggregate and manage data in a privacy-compliant manner – a Customer Data Platform (CDP), Umeh said.
A CDP was designed to pull data from multiple sources and touchpoints and create a 360-degree view of each customer. This allows for personalised and contextual advertising.
For instance, to market a specific brand of beer to male customers in the East during a premier league football match, as against a female in the North; or promote travel insurance to a bank customer who just made a payment for a flight ticket.