For nearly three decades, many brands have pursued a 360-degree view of the customer. They worked to collect as much customer data as possible within one solution, such as a data lake, data warehouse, or even a CRM, in an attempt to truly know their customers.
As utopic as the “customer 360” sounds, it’s failed to pass the “So what?” test. The massive amount of collected data hasn’t translated into a better understanding of customers.
New data privacy regulations further complicate the situation. They set new rules for collection, storage, and processing of customer data. As a result, the risks have increased for “know your customer” programs, while the rewards remain elusive.
Brands need to move past the catchy customer 360 concept and take a new approach.
Imagine your CX as a chain, each link representing an interaction between your customer and your brand. Every good interaction adds another solid link and makes the chain stronger. But just one experience -- one bad link-- breaks it.
Back in the 1990s, Tom Siebel introduced the need for a 360-degree view of the customer – also referred to as single source of truth or the golden record by some. Simply put, the term represented a brand’s quest to know everything about a customer by collecting their data.
At around the same time, mergers and acquisitions created a sea of conglomerates, leaving IT departments with a mix of disparate systems to manage. With all the system and data silos, organizations weren’t able to get a full picture of their customer, and customer experience suffered.
These challenges represented the beginning of the market seeing the 360-degree view of the customer as their shiny beacon of hope.
Unfortunately, the complication of tech landscapes didn’t stop there. The world didn’t come to an end as we rung in Y2K, but change did come. Alibaba achieved profitability in 2001, and Amazon accelerated its expansion into new categories beyond books. The inception of multi-channel experiences had begun.
Customer centricity is the act of putting your customers at the heart of everything an organization does. To be customer-centric, brands should consider a customer data platform - here’s why.
Fast forward to the 2010s. E-commerce moved to mobile devices. The digital transformation era accelerated the increase in systems, channels, and data. In any given company, there’s an average of 11 systems of customer data dispersed across varying CX applications and organizational groups.
More recently, the sharing economy and on-demand platforms have changed how consumers interact with brands. The volume and type of data that organizations need to process and understand has exploded, including new data formats in the form of surveys, social posts on TikTok, and YouTube videos. Personalization, customization, and real-time engagement have become table stakes.
Meanwhile, customers have become the owners of their interactions with brands. They expect brands to know who they are, communicate with relevant content where and when they want it, and provide transparency on how their data is collected and used.
Throughout the evolution of the digital era, many brands viewed the 360-degree view of the customer as a key part of their growth strategies. Yet, 30 years of history shows the benefits of this pursuit never fully materialize.
Vendors and brands equate the creation of a 360-degree view with the goal of eliminating system silos accumulated throughout the years. These silos have caused a lot of headaches and missed opportunities within organizations, especially IT teams. The idea of ripping them out and replacing them with one magical customer view sounds like a godsend.
Yet removing system silos is not a realistic goal for many businesses. It simply doesn’t reflect how they operate and is too expensive of an endeavor.The truth is every system in a company’s tech landscape represents a major investment and addresses a specific business need. No single solution today can:
Preaching that a 360-degree view of the customer would solve all these challenges lacks empathy for the organization. Tech stacks with system silos aren’t going anywhere.
The power of personalization, powered for business: Customer data platform (CDP) solutions help brands build on foundational insights to go beyond marketing and impact the full customer journey.
The last few years, customer data platforms (CDPs) have become the go-to solution for brands looking to achieve the coveted 360-degree view of the customer.
Unfortunately, the reality hasn’t met the hype. Most CDPs focus on marketing use cases. This means the data collected in these solutions and the profiles they create are geared specifically for marketers.
Yet marketing isn’t the only channel for customer engagement. To increase retention and strengthen brand loyalty, companies need to deliver relevant, accurate, and in-moment experiences across all touchpoints. They need a solution that can help them uncover the right insights for every single experience and every use case, from marketing and commerce to sales and service.
Today, brands have customer profiles everywhere: CRM systems, marketing solutions, and commerce systems, to name a few. Yet the data they collect, the way it’s processed, and the output of that data are all designed to address limited scenarios.
There’s no single profile that can deliver timely information assembled from all customer data sources to all engagement systems across the organization.
Esteban Kolsky, SAP Customer Experience’s chief evangelist, urges organizations to cease chasing this notion of a 360-degree view of customers: “The better strategy is to focus on use cases, and figure out how to get the trusted, accurate, relevant, real-time customer data for those instances.”
Businesses have lots of data - but what do they do with it? Discover how a CDP helps organizations reach customers, identify intent, and personalize messaging to exceed KPIs and bottom line projections.
For example, customer care agents need an accurate log on customers’ previous purchases, information on those products, and any warranty and promotions tied to it. Marketing managers want insight on propensity to churn, customers’ interests, and preferred channels. E-commerce managers need visibility on product inventory level, popular sales, and customer browsing behavior.
Each instance requires a different set of customer data attributes to meet the specific use case. It’s simply not feasible to ingest and analyze all customer data for any context.To become truly customer-centric — that is to make business decisions with customers’ interest at the core — brands need to surface the necessary customer insights to fit the context, in real-time, for specific use cases.
Contrary to popular belief, we don’t need to know everything about the customer, we only need to know what’s relevant to have a positive impact on profitability and sustainable growth.
Sergey Krayniy, head of product development for SAP Customer Data solutions, says contextual profile views will be a key for CX success:
“For real-time engagement, software solutions need to be agile. They’re simply not agile if they’re required to analyze massive amounts of data at every turn. Instead, today’s CDP solutions do the hard work of unifying the data, analyzing it, and surfacing the relevant insights based on use cases.”
CDPs are one of the fastest growing technology solutions in the market, and it’s easy to see why. Let's take a closer look at the advantages of customer data platforms that are spurring their growing adoption by companies.
The solution that brands need today emphasizes data unification and holistic profile creation, but also goes beyond marketing use cases. This customer data layer must serve as a foundation that also can fuel commerce, sales, and service interactions with insights and rich customer context.
The result is a next-generation customer data strategy, one that emphasizes integration with engagement systems across the organization to deliver the needed customer insights and context.
With benefits ranging from improved customer satisfaction to less IT resource strain, this fresh approach may finally end the dominance of the 360-degree customer concept once and for all.
