Data is the key to winning over customers’ hearts, and marketers depend on it as the linchpin of their strategies. But as rules around privacy continue to shift—such as the onset of Apple MPP, tighter GDPR protocols, and the oncoming death of the cookie—the data-point path to customer loyalty seems more complex than ever.
Many brands rightly responded to these perceived roadblocks as a blessing in disguise, and marketers everywhere shifted their focus to collecting accurate, relevant data to power their experiences.
However, marketers are still left with several challenges. While they realize the need for higher-quality data, they are unsure of where to source it. For those who do have mountains of data on hand, activating it quickly proves to be another issue. Underpinning these challenges lies the pressing reality that the majority of customers need nuanced personalization to stay loyal.
While the to-do list may seem endless, this guide is here to enhance your data-privacy practices all while powering personalized creative content.
- Introduction
- The Guide to Data Privacy and Data-Driven Personalization
- How to Use Zero-Party Data
- How to Use First-Party Data
- Your Data-Driven Marketing Toolbox
- Conclusion
The Guide to Data Privacy and Data-Driven Personalization
To generate data-driven communications in a privacy-first world, start by observing current pain points that could lead to strategic opportunities. Begin with the root of the issue: data privacy itself.
What Is Data Privacy?
Data privacy refers to protection policies that govern how customer data is collected, used, and stored by brands. By complying with these set guidelines, brands keep personal data from being shared with third parties that customers have not expressly agreed to.
This differs from data security, where the goal is to guard customer data against infiltration from malicious outside sources.
The Top Three Data Privacy Concerns
While the need for data protection now seems obvious, it’s important to understand the factors that drove its prioritization for customers in recent years:
- Loss of Control
- Customers are rightly uneasy about their data being used without explicit consent. This concern grows as they become increasingly inundated with marketing communications, making it even more difficult for them to track their own information.
- Lack of Transparency
- Often, customers are comfortable with their data being used if the payback is worth it. However, customers want to be in the know so that they can make these informed decisions themselves.
- Limited Attention
- Personal data is precious, and customers only want to share it with brands they trust. But with limited time and attention, only a select number of brands can be deemed worthy of loyalty—and data—for most customers.
Marketers need to earn customers’ trust before they can expect to be handed more data. To build the relationship, marketers must go beyond basic compliance and show customers how their data is being used for their benefit.
When over two-thirds of customers are more likely to be loyal to brands that deliver personalized experiences, marketers know it’s time for truly data-driven marketing.
What Is Data-Driven Personalization?
Data-driven personalization occurs when brands activate data to build uniquely tailored campaigns that deliver individualized content to every customer. When working in tandem with data privacy, the strongest data brands can use comes directly from interactions with customers.
Ultimately, data privacy and data-driven personalization are the two elements that make up data-driven marketing, which is the key to a happy and healthy customer-brand relationship. When done correctly, it is a powerful relationship-builder, with one-third of global consumers stating they trust companies that provide relevant, 1:1 communications.
This makes data-driven marketing non-negotiable. With this fact top of mind, it’s time to uncover how to implement it, starting with where to collect accurate data.
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How To Use Zero-Party Data
The secret to balancing data privacy and data-activated personalization lies in zero- and first-party data. Not only does this data comply with the toughest protocols, but it is also the most accurate. After all, it comes straight from the source: customers themselves.
The Definition of Zero-Party Data
Zero-party data is the information customers voluntarily give to brands in exchange for a better marketing experience. In this case, customers tell brands exactly what they want, and they rightly expect their preferences and requests to be honored by brands worthy of their trust.
If brands fail to carry out these expectations, customers will have the same jarring experience as receiving the wrong dish when ordering at a restaurant. And in the same way, you can be sure that both a positive or negative experience will be relayed to other customers and prospects.
Three Ways To Collect Zero-Party Data Now
Zero-party data is ideal for marketers, but where can they look for it first? Here are some key sources you can use at various stages in the customer journey:
Enhance Marketing Comms Sign-Ups
Include brand-specific questions that reveal more about customers when they sign up for marketing communications. Be sure to look beyond name and email address and ask a few telling questions to get to know the customer and ensure future communications are relevant.
Here, a poll included in My Jewellery’s newsletter asks customers about their preferred styles. Once customers participate, My Jewellery follows up with retargeted messages based on each individual’s personalized needs.
This is the perfect way to start off with zero-party data, as this tactic targets customers that are in the early stages of engagement.
Gamify the Marketing Experience
Polls, challenges, and quizzes are all engaging ways to incentivize customers to share more data. Customers participate in a clear value exchange, a critical piece in building customer trust, when they share their preferences and receive retargeted messaging as a result.
Palace Sports and Entertainment does just that by quizzing customers on where they’d like to watch their next concert and what they’d like to listen to. By gamifying the experience, customers are inclined to take action and share their preferences. It’s key to keep tactics like these on rotation to stay in the know as customers constantly evolve.
Preference Centers
Similar to the settings app on a new phone, every customer is likely to provide key information in preference centers after downloading a branded app.
In this case, zero-party data is low-hanging fruit. Customers interacting with preference centers are those who have already shown a level of commitment to your brand by downloading the app. Be sure to reward them with personalized content that reflects the data they've provided.
How to Use First-Party Data
Actions often speak louder than words, and the same is true of customers. Brands can learn valuable information simply by being quick to listen and notice what customers are already doing organically.
The Definition of First-Party Data
Whenever customers interact directly with a brand’s channel or sources, the data trail they leave behind is known as first-party data.
Key examples would be customers browsing websites, searching for items on an app, interacting with social media platforms, or even making a brick-and-mortar visit.
Three Ways To Collect First-Party Data Now
Don’t rush into conversations with customers without taking the time to listen to what they’re saying. Here are three ways you can hone in on the conversations that are already happening between you and your customers:
Behavioral Data
Behavioral Marketing tools can capture customer interaction data from any source. By using tools such as tracking pixels or APIs, marketers can follow customer journeys across every brand touchpoint, from casual browsing to app downloads.
But when taking note of what customers are doing on your site, it’s crucial to not only observe what they’re doing, but what they’re not doing. Did they leave an item behind in their cart? Did they skip past your form fill? Learning where customers get lost along the way will enhance future retargeting.
Toolstation turns a lost sale into a strategic opportunity in their abandoned cart email. Using behavioral data, the brand not only reminds the customer of the product left behind, but also pipes in a personalized bundle deal to further motivate engagement.
Transactional Data
Completing a purchase isn’t the end of the story for a customer. To foster true brand loyalty, marketers need to keep the connection alive and use the last high-value action as their conversation opener.
Follow up purchases with a tempting personalized recommendation. Or, take this opportunity to build product credibility and ask happy customers to share their ratings and reviews.
Here, Inkredible Retail uses the shipping threshold as a basket-building upsell. By including personalized recommendations—based on first-party browsing data—that cost just enough to qualify the purchase for free shipping, the customer is motivated to add a little something extra. Multiple data points are transformed into compelling content, with the retail brand pairing positive ratings with each recommendation.
Offline Data
Data-gathering knows no borders, and marketers that take on a truly omni-channel approach by learning about customers online and off will come out on top.
From brick-and-mortar visits to CRM data, it’s important to include every channel to gain a full, accurate understanding of who the customer is.
No matter the data climate, receiving information straight from the source is a crucial piece in delivering relevant communications that drive lasting loyalty. By relying on zero- and first-party data, brands allow customers to take the lead, creating a fool-proof marketing plan for winning campaigns.
After nailing down data sources, the next step is translating them into data-driven marketing communications.
Your Data-Driven Marketing Toolbox
Customers demand hyper-personalization, but even when brands have treasure troves of high-quality data, it can be challenging to translate it into engaging content. But have no fear—while it can be difficult, it doesn’t have to be with the right tools and methods.
The First Tool: Automated Omni-Channel Content Personalization
Efficient tools are necessary to organize, translate, and activate data into relevant content that leverages customer information to its fullest potential. Remember, customer data often has a short lifespan, and marketers must act quickly to make an impact.
What marketers need first is automated omni-channel content personalization.
- Automation is a marketer’s best friend. It skyrockets productivity by offloading manual tasks such as generating countless creative variations or doing manual coding. This leaves marketing teams with more time for strategic initiatives. Additionally, automation makes 1:1 data-driven content personalization scalable; contextually relevant messaging is virtually impossible without it.
- Omni-channel is the expectation for customers as they switch between devices. It’s essential for brands to offer customers convenience with relevant content at every touchpoint and a consistent brand experience. Dynamic content can be used in campaigns once and then easily repurposed across other channels is ideal.
- Content is the butterfly and data is the caterpillar. For data to truly be activated, it needs to be transformed into personalized visual content that captures customer attention. After all, content with visuals drives a staggering 94% higher level of engagement than text-only messaging. The ability to create content from multiple data sources within one image is critical.
- Personalization is the make-it or break-it factor for over 90% of customers. Especially as shoppers are increasingly bombarded with different brands and options, personalization has become a crucial differentiator.
The Second Tool: AI Powered Personalization
There needs to be a way to make sense of data and learn from it to understand what the best content and products are for each customer at any given time. An AI powered personalization solution that works with data sources from marketers’ existing tech stacks can do this while optimizing customer experiences for loyalty and lifetime value.
Using machine-learning models, customers are consistently shown content that ensures short-term goals are met and develops them into the best customers they can be in the long run. AI powered personalization allows marketers to showcase never-before-seen content that they know will surprise and delight customers, rather than relying solely on previous actions. As an added win, every interaction will help the AI learn more about the customers, refining future retargeting.
With the right tools in your back pocket, you’re ready to create your own data-driven, engaging brand experience.
Conclusion
Data privacy may sound like a challenge, but in reality it’s a prime opportunity for relevant marketing that engages customers and incentivizes their lasting loyalty. With the right understanding, methods, and tools, marketers can not only successfully navigate the challenge, but also keep their brand top of mind and ahead of the competition.
