Data & Analytics

Looking to Win Shoppers Back? It’s Time for a Data Strategy Makeover

July 23, 2020  |   Alice Stratton

The retail business has always been cutthroat, and it’s become exponentially more difficult this year to find a competitive edge with shelter-in-place orders and the loss of third-party cookies on the horizon. The silver lining is that we’re beginning to see consumer spending slowly bounce back, making it all the more important for marketers to make every dollar drive business results. To do this, it’s critical to understand consumers’ context and needs before engaging them with a message that they’ll find welcoming and resonant. 

All of this takes a lot of data that retailers may not have access to or may soon lose. Shelter-in-place orders fragmented the understanding of the customer journey. With brick-and-mortar stores shuttered for months, and many goods and services delivered by third parties, brands that haven’t secured data partnerships with delivery companies are losing incalculable amounts of customer data. 

Rolling back the clock to pre-pandemic times, the continued demise of the third-party cookie should have been a call-to-action for retailers to find a way to salvage the data in their DMPs. However, most are still not prepared for the eventuality that they will lose their largely cookie-based capabilities of targeting, measurement, frequency capping, suppression, and others. Imagine botching the shopping experience for your most loyal customers by hammering them with display ads for the jeans they already bought—it would be like returning to the dawn of digital marketing when everyone saw the same ads, no matter who or where they were. 

Building a new data foundation

Revamping your data strategy to solve for cookie deprecation and open the door to new partnerships does not happen overnight. It starts with a solid data foundation that helps you build on your single view of the customer:

  1. Secure your data: To immediately “plug the holes” left by cookie deprecation, data teams should work with an identity provider that can ingest cookies and preserve knowledge that currently exists in DMPs. This will smooth the path to migrating off cookie-based technologies without sacrificing what you already know about your audience.
    By preserving and protecting your single view of the consumer, you’ll be able to continue engaging with them long after third-party cookies are fully deprecated. This also sets you up nicely to organize your internal data. 
  2. Promote internal data use: There’s no better way to maximize the value of the data you have than by ensuring it is accessible to everyone who needs it in a permissioned and secure manner. Often, data is siloed because different teams have different access and permissions for data use. By building a robust data foundation with tailored privacy controls and permissions for data access, teams can more easily share information and collaborate in making critical data-driven decisions. Moreover, the ability to safely combine formerly disparate data sets could create powerful new insights for teams to act upon.
    Recently, Starbucks decided to close up to 400 of its stores and shift to drive-through service, curbside pickup, and delivery. This is a bold move, and before it was made, the brand had to have the right analysis to back up the initial decision, as well as the measurement capabilities moving forward to prove the hypothesis.
    Amidst a continuing recession, more brick-and-mortar companies will make similar pivots. The difference between surviving and thriving is access to the right data insights to spur action.
  3. Create more valuable partnerships: Working with a secure, permission-based data foundation also makes it possible to consider data collaborations with external partners. Comarketing has been done for years—think about the many retailers, airlines, and hospitality groups that offer credit cards—but by aligning with potential partners from a data privacy perspective and agreeing on a neutral data environment to collaborate in, a host of new abilities becomes possible. You can more accurately assess partnership potential by comparing customer databases in a privacy-first manner and measure results to justify additional investment.These second-party data partnerships have been discussed for a few years, and data loss is speeding these conversations. Expect data collaboration to become the norm as more brands invest in the ability to do so in a way that upholds consumer privacy and preserves data fidelity.

By focusing your data strategy on preserving and enhancing a single view of the consumer, you’ll not only safeguard your knowledge base against current headwinds, you’ll also unlock a virtuous cycle of data that gives you autonomy over the big four technology strongholds. At every step in the journey, you’ll have a deeper understanding of how data powers your business and the ability to better connect with consumers.

 

This article first appeared in Retail Dive. View the original article here.