How to Use an Identity Graph Solution to Gain Insights and a Competitive Edge
Digital advertising revenues recently surpassed the $100-billion mark for the first time. During the past 10 years, digital advertising expenditures increased nearly five-fold from $22.7 billion in 2009 to $107.5 billion last year. Much of this spending is in addressable media. Brands go to where their customers are. And those customers need to be recognized so brand engagement can stay right in step.
However, with so many data elements across mobile, online, and offline platforms, how do brands make sure they don’t lose a connection? Enter identity graphs and identity resolution.
Consumer marketers are grappling with literally hundreds of identifiers, from email, phone, cookies, and offline identifiers such as loyalty card numbers, to third-party data culled from the consumer marketplace. Can and should marketers correlate these data with insightful, individual customer information? Would that give brands a competitive edge? The answers are yes.
For marketers, now living in a customer-centric age, having a rich customer profile constitutes a Holy Grail, with the resulting database acting as the center of customer truth. So why isn’t every brand managing and resolving identity through an identity graph solution?
Identity Management Solutions May Not Be Practical for All Consumer Brands
For a start, integration using identity graphs is not inexpensive — though returns can be impressive. The cost of such data, technology and analysis may range from several hundred thousand to millions of dollars, a direct function of the volume, velocity, and variety of data in play – leading to a significant uptick in spending. According to The Winterberry Group's report "Know Your Audience: The Evolution of Identity in a Consumer-Centric Marketplace":
"... US spending on identity solutions is expected to increase by 30% each year between now and 2022, when total spending will reach $2.6 billion.”
Second, it’s not easy.
Larger companies are setting the bar as it relates to real-time data-informed applications – providing relevance in content, timing and engagement. In other words, they’re able to identify and develop a deep understanding of the individuals who are in-market, and execute strategies in real time, or near real time, that pique consumer interest based on derived insights.
Such companies, relatively speaking, have the necessary resources back it up: in particular, the technical expertise to integrate the data; the data scientists to optimize the data; and the marketing prowess to derive economic value – working in collaboration with each other – across departments and functional areas, and likely outside agencies and solution providers.
Get Assessed: When Might a Brand Be Ready
Despite its vast potential, how do you know if an identify graph is appropriate for a brand, or even if it is the right time?
This is not a solely in-house proposition, though the process requires true corporate collaboration to ensure that it is time and money well-spent. Then there is a vendor selection and system implementation, because investments in technology, workflows and data likely are necessary.
So, what should a company look at internally when considering an investment of this magnitude?
Some best practices in due diligence already have emerged:
- Brand Objective Assessment – Identity graphs can be deployed for a variety of business objectives, including, but not limited to, audience development, media optimization, store traffic, customer retention, and customer growth. These stated objectives are best identified, at least in part, up front. The better defined the objective(s), then the better measurement mechanisms can be implemented to derive the ROI.
- Audience/Data Assessment – Are there “blind spots” in the data sets? Are there large amounts of user data going unmatched? Are there silos of data not being staged, parsed and integrated, from which customer value could be languishing untapped?
- Technical Assessment – From tech stacks, to data lakes, to cloud services or other infrastructure: does the company have internal and external technical acumen to support real-time identity solutions? Does the company have the internal infrastructure to accommodate an effort of this scale? What are the gaps to buy or build?
- Organizational Assessment – Is the senior management team and enterprise buying in to customer-centricity and outcomes? Silos are self-defeating, for example. And resources may require a total company commitment. Can the company afford it, taking into consideration the upside of potential ROI?
You’re Ready. Now What? Due Diligence
Identity graphs that enable customer recognition with confidence may be huge in scope and scale, with the most comprehensive containing billions of data points. Once a gap analysis is completed, it’s not something most IT departments, no matter how sophisticated, have the expertise to tackle on their own. Consultants, data partners and tech partners likely are necessary.
Most wisely turn to outside vendors with proven identity resolution experience, cases and proof-of-concept methodologies. How do you know which one is right for you?
One of the first questions to ask is, “Will external partners collaborate on a pre-purchase analysis of their data offerings?” Not only will this give key information needed on such key metrics as data-match rates prior to implementation, but it also will allow a mutual understanding of how a brand or enterprise and the vendor work together.
In our executions, we find that a “due diligence” session, subject to confidentiality, often works best in advance. A literal half-day or full-day meetup where data, processes, people and technology get a more thorough investigation to help ensure any eventual data and identity graphing is an appropriate buy, given the current of assets.
Also, brands should ask for references and recommendations – as well as gauge vertical market expertise in the brand’s specific market. Do they understand a brand’s business and its goals? What outcomes were achieved in prior implementations? And, importantly, can they demonstrate that the solution provider, as well as that of their partners, is privacy-compliant. Data governance is not only a policy expectation – it’s a business imperative for any customer-centric organization.
Identity Graphs at Work
Here are two examples that show how identity graphs enable customer identification, and support sales growth:
Tapping Anonymous Web Traffic: Sample Model
- Identity graphs unlock the value of anonymous web traffic. Businesses can incorporate the data layer provided by an identity graph into their marketing ecosystems to match anonymous digital identifiers from their websites to the individuals and households found within the graph itself. The data from the identity graph is used to provide detailed consumer insight which is not associated with the digital identities. By identifying and adding structure to the digital IDs, marketers are able to focus their programs on people, rather than blindly retargeting unknown devices. Recent events, such as COVID-19 have only underscored the importance of customer recognition on remote devices.
- Identity graphs enable the addition of digital communications interaction points to physical addresses. This is also known as digital onboarding, or customer onboarding. Identity graphs are frequently used to add email addresses, hashed email addresses, social handles, cellphone numbers, internet advertising categories, digital interests, and similar digital and mobile attributes to terrestrial house files, transaction databases, and direct mailing lists. Thus, marketers can efficiently communicate with their audiences across multiple channels – to improve engagement, response, and attribution, particularly crucial when physical foot traffic is at a standstill or severely diminished.
Sample Output From an Identity Graph Application
Companies can go a long way toward developing and enhancing sustainable relationships with the implementation of an identity graph, providing a platform for companies to efficiently reach their customers and to effectively compete in today’s multichannel world. An unrecognized customer is a hugely missed opportunity.
Riad Shalaby is the CMO of Audience Acuity. Riad has more than 3 decades of consumer marketing and management experience. This includes operational experience with start-ups and senior leadership experience with large, global enterprises.
Prior to joining the company, Riad was the CEO of the Reunion Group in Ft. Lauderdale. He has served as the CMO at the Marina Bay Sands in Singapore, at Tropicana Entertainment in Las Vegas and at Allconnect in Atlanta. Riad was VP of Consumer Marketing at Equifax and a member of the executive team at Abacus-Direct, a Division of DoubleClick.
In the 1990s, Riad founded and sold a technology company. The firm developed over 150 data warehouses in 8 different industries and was acquired by Group1 Software (NASDAQ, GSOFT) in 1995. Riad began his career with Hilton Nevada Corporation and holds a BS and MBA from the University of Nevada, Las Vegas.