What is Customer Data?
Marketers always strive to better understand, communicate and engage with their customers. Customer data turns this ambition into action. By using intelligent tracking capabilities, brands can collect customer insights such as digital and in-store interactions, purchase histories, demographics, preferences and more.
Marketers then use this data to personalize ad campaigns, deliver timely communications and engage their customers with seamless brand experiences across all channels.
Types of Customer Data
Customer data comes in many forms. Whether it’s basic demographic information or robust, AI-enabled analysis, customer data can be unified into a holistic, actionable customer profile. However, not all data is made the same; explore the types below to learn about the data your brand needs (and doesn’t need) to create personalized and effective marketing campaigns, every time.
Personally Identifiable Data (PII)
The first type of data we’ll discuss is Personally Identifiable Information, or PII. PII involves any data tied to an individual, including email, address, phone number, an ID number — or anything else that can be used to identify a person. Because this data is highly sensitive, brands must maximize security in data collection and usage.
Importantly, customer data should remain anonymous to any third parties. For example, when the brand first uploads first-party data from the CRM to an onboarder’s platform, the CRM data virtually always includes personalized identifiers. However, highly secure data onboarding platforms use a hashing process to remove PII and match with online identifiers or device IDs. This process ensures complete anonymity, creating a layer for data privacy.
Engagement Data
In short, engagement data details the interactions a user has across all brand channels. This metric enables marketers to gauge a user’s level of interest, preferences and intentions, no matter the touchpoint. As it gets collected, engagement data helps marketers to develop a more detailed profile of any customer or audience segment.
Engagement data is a key metric that reflects the overall brand experience. By leveraging this data, marketers can not only gain customer insights and boost campaign performance, but also support a seamless experience between all consumer interactions, online and off, past and present.
Behavioral Data
Behavioral data is all about action. Site browsing, purchasing and email sign-ups are all considered behavioral data that aims to observe and infer customer intent. This type of data is similar to engagement data, however, it only tracks customer interactions with the brand online. To effectively leverage behavioral data, marketers must consider situational context, such as time of day or location, in addition to self-submitted preferences of the user.
Even better: by synching behavioral data with offline historical data in real time, marketers can engage with customers in a relevant, personalized and timely way.
Demographic Data
Demographic data describes a customer’s characteristics. Demographic information can detail gender, geography, occupation and age. While demographic data can be useful for wide targeting, a rich user-level profile encompassing customer data across all channels provides a significantly more holistic (and effective) approach to marketing. To enrich demographic information with more dynamic datasets, marketers need access to — and ownership of — their customer data.
Who Owns Customer Data?
Customer data is not only a valuable asset but also a responsibility. With growing concerns around online privacy, companies must now speak to the source, ownership and distribution of their customers’ data. Luckily, most modern companies can choose how and where to collect and use their data. Customer data falls into three types: first-, second- and third-party data, each having implications regarding privacy.
First-Party Data
First-party data is information collected and owned by the company with which a user has interacted firsthand. Companies collect their customers’ behaviors, demographics and preferences through in-house software or systems for use in marketing campaigns or product development.
Second-Party Data
Second-party data describes first-party data that companies share with trusted partners. This customer data, the exchange of which is limited to those partnerships, enables marketers to reach a wider audience while still delivering personalized content.
Third-Party Data
Third-party data gets collected by an outside source that has had no direct relationship with the user. This data gets stored and distributed to companies targeting large audiences, striving to cast wide marketing nets with little personalization.
How to Collect Customer Data
Consumers often share data with reputable companies in exchange for more personalized, convenient brand experiences. Of course, trust is at the core of developing these mutually beneficial and long-term customer relationships. To build customer trust, brands must commit to complete transparency into their data practices and collection.
In fact, modern consumers are more willing to share data if they:
- Know how their personal data is collected and used
- Have access to easy-to-understand terms and conditions
- Perceive a clear link between sharing data and benefits
Once they establish and maintain that framework of trust, companies can begin to collect customer data through engagement touchpoints: websites, brick-and-mortar stores, mobile apps, advertising units and social media accounts.
However, it’s important for marketers to remember: every data point should have a determined purpose before it’s collected (remember SMART goals!). Otherwise, marketers are risking wasted ad spend and misled targeting efforts.
Contact Information
Not all contact information is made the same. While collecting a site visitor’s name can enable personalized messaging, that’s just the tip of the iceberg. Email addresses, on the other hand, can serve as a long-term link connecting customer identities to brand channels. With the right data collection tools, this first-party data enables marketers to target customers with meaningful, relevant content across all channels.
Tracking Pixels
A tag contains code that collects user information and/or delivers personalized content based on historical data. A pixel is a lightweight type of a tag that lives within the browser. Without carrying much data, a pixel collects basic information about a user or uses cookie settings to track that information. Pixels, utilized by various marketing tags like Images, JavaScript, iFrames, or Server-Side Tags, enable a personalized web experience on an individual user basis.
Transactional Information
The act of the transaction itself goes beyond signaling the success of a sale. As marketers mold personalized campaigns around customer data, transactional information can serve as a measure of individual campaign effectiveness. As more sales get attributed to marketing efforts — or vice versa — marketing teams can continue to refine their strategies to drive customer engagement and brand loyalty.
Website Analytics
Websites contain a wealth of customer data. Websites can collect data by incorporating basic forms for names and emails or by integrating with tools that capture behavior and engagement insights. Website analytics are also useful for specific retargeting strategies. For example, some analytics tools can track behaviors such as users hovering over an image or text. This information provides context on intent or interest of the customer.
Social Media
Social media offers rich data collection opportunities. When integrated with other customer data points, social media data can deeply enrich the customer profile. For example, by tracking impressions, capturing actions and targeting 1:1, marketers can reach the right audience with personalized content or offerings right where they are.
However, marketers should leverage a data foundation that enables not only social media data collection but also unites other data and provides distribution capabilities. Ultimately, modern marketers should think beyond social media: how can customers be reached in a meaningful way, no matter the channel?
Customer Surveys
Surveys aren’t dead. In fact, qualitative customer survey data is vital to fully understanding the customer journey. This survey data enables marketers to gain visibility into customers’ experiences that may not be obvious from the mouths of customers themselves. For example, companies can collect and analyze customer sentiment across independent review sites, competitor solution pages and other platforms during a customer’s research.
Customer Service Software
What if you could have a single customer view across all online and offline channels? Offline customer data, such as information obtained from a call center, supports that holistic understanding of the customer. However, many brands fall short of connecting offline data to their digital data storages. Why? Between technological silos and a lack of first-party data ownership, companies struggle with obtaining the data they need about their customers.
Integrating all that rich information into persistent customer profiles, and tying data sets back to real people, will enable brands to continuously recognize their customers wherever they are, as they switch between devices, and digital and physical environments. Moreover, connecting offline and online data helps marketers provide contextually relevant experiences, shaping interactions with the customer based on needs and wants, and where they are in their journeys.
Benefits and Marketing Use Cases of Customer Data
People-first marketing thrives on the personalization enabled by customer data. Unified data allows brands to tie a user’s online activity to a single point of origin, forming a detailed profile of the customer’s interests and receptiveness to marketing communication. With this approach, marketers can leverage efficient, effective and scalable campaigns while driving innovation and revenue across the organization.
Capture Customers Where They Are
In an always-on, real-time world, consumers want increased personalization and relevant, timely messaging. Without customer data, marketers are left to guess when it comes to targeting, often driving away potential or existing customers. By using the right data strategy and technology, brands can deliver an excellent omnichannel experience, capturing their on-the-move audiences in the exact right time of the customer journey.
Create Great In-Store Experiences
The benefits of customer data don’t stop at digital. By integrating online and offline customer data, marketers can use a consumer’s browsing history, including chatbox queries or abandoned shopping carts, to personalize the real-world shopping experience. Customer data empowers the in-store experience to evolve with the marketplace — as it’s not going away anytime soon.
Improve Marketing ROI and Cut Costs
Customers reward seamless, personalized brand experiences with loyalty. Unified customer data not only supports this valuable notion but also helps companies minimize the costs of ineffective campaigns. In short: by hyper-personalizing every brand interaction, marketers can stop draining ad spend on wasted impressions of mistargeted audiences, resulting in a higher ROI across all marketing efforts.
Unifying Customer Data
The bottom line: customer data is not about how much data markers can store about their customers. It’s about collecting the right data and fusing it into a unified event stream at the customer level. Accurate, unified and up-to-date customer profiles across all channels are key to effective people-based marketing.
Challenges of Customer Data Silos
Rich customer profiles require robust connections between the customer and all channels of engagement. However, when data gets siloed in vendor ecosystems, these connections are broken. The result: fragmented and often misleading data on customer behavior, leading to ineffective campaigns, and, worst case scenario, losing customers. Brands must maintain ownership, control and access of their customer data to create a single customer view that delivers the full, actionable picture.
Offline vs Online Customer Data
Modern marketing goes beyond online interactions: it aims to capture all digital, physical and human touchpoints. Continuously integrating and synching online data with offline data allows marketers to create robust customer profiles that cover all bases. Every brand engagement, whether it’s on a desktop, smartphone, chatbox or in-store, can unite to power insights that marketers need for genuine, consistent and timely interactions.
Customer Data Onboarding
Data onboarding is a key capability required for optimizing the use of customer data. The technical process involves uploading offline customer data online to match digital identifiers. With ongoing onboarding, brands can update and activate customer profiles in real time, resulting in actionable insights that scale across all marketing efforts.
As a result, marketers can engage their customers with relevancy and value at strategic stages throughout the customer lifecycle. This capability not only drives profit into the organization but also builds lasting, meaningful relationships with customers. And, at the end of the day, no business exists without the people to support it.
