It's a challenging but crucial task for marketers to learn how to harness and activate against data insights on their customers — while seeing these customers as real people and working to preserve their trust, writes M&C Saatchi One-to-One's Adam Reader.
I don’t know who you are exactly, but I can see that you’ve clicked on this article. I can probably see where you’ve clicked from, too — heck, if the publisher is willing to share all of their platform analytics, I’ll likely be able to see how long you’ve been reading for.
But while a lot of these metrics give marketers like me an indication of how people like you are acting now (and therefore what you might do in the future), these data signals are only a two-dimensional picture of you. There are, of course, many other factors which will affect how you 'experience' this article and what impact it’ll have on your day, week, and maybe even the rest of your life (hey, a marketer can dream).
For example, are you reading this on your way to work? If so, are you in a rush? Did you get to eat breakfast with your family before you left? Do you have a big meeting that you’re preparing for today? Did you discover this article yourself, or did someone send it to you? What else is going on in the news today?
So, while I’d love to believe that this article is the most important thing you’ll read all day, it would be naïve and presumptuous to think that what I’m saying is relevant to you, in this moment, based solely on your decision to click. Or to think that you’ll continue to engage with every future article published by yours truly.
In other words, it would be fairer to borrow a more succinct lead-in from Liam Neeson:
“I don’t know who you are. I don’t know what you want”… yet.
The same is true for brands and their customers.
A quick history of CRM
The concept of customer relationship management (CRM) first emerged in the 1970s, as businesses began to track customer satisfaction through surveys and organized customers into categories or lists. Since then, CRM and the expanded definition of customer experience (CX) has seen several evolutions towards our current state.
Gaining popularity by the turn of the century, many well-known platforms (think Oracle, SAP, and Salesforce) were founded or incorporated CRM capabilities into their broader Enterprise Resource Planning capabilities, to service businesses now incorporating some form of CRM into their marketing efforts. Throughout much of the 2000s and 2010s, the rise of web2 — and the growing role of big data — brought new opportunities to capture and analyze more semi-structured and unstructured data – thanks to an explosion of web traffic, online stores, and social media platforms.
The net effect? During CRM’s existence, marketers have found new ways to collect, store, and utilize data that may offer “insight” into customers’ needs and behaviors and inform increasingly efficient marketing strategies. That desire for more data has been ever-present among those wanting to grow their business and maximize ROI.
Fast forward to the present day: our appetite remains sky-high, with a recent Ernst & Young study finding that a staggering 93% of companies plan to keep increasing investment in data and analytics.
However, our relationship with customer data and its implications for modern CRM continue to evolve — most notably, driven by three trends.
1. Data privacy concerns
With the increasing amount of customer data being collected by businesses, a KMPG study found that 86% of the US population believe data privacy is a growing concern. That same study found that 40% don’t trust companies to use their data ethically. As such, the issue of data protection, or lack thereof, is forcing not only businesses but governments to respond and introduce measures (like the California Consumer Protection Act and Europe's General Data Protection Regulation) that give greater control to consumers.
While the entire topic of data privacy warrants its own dedicated article and discussion, there are two immediate developments that CRM practitioners should consider: the imminent 'cookieless world' (just as scary as it sounds for marketers), combined with limitation and/or blocking of cross-domain trackers.
The implication is that as upper funnel options to track and learn about customers are diminished, marketers need to reconsider where to invest their efforts (and budgets) for “data activation.” This places even greater emphasis on the role of CRM to connect with and build trust among customers in the mid-lower funnel, to inform more effective retention based on data they’ve consented to share.
2. Mainstream marketing automation
Aligned to the marketing principle of “right message, right channel, right time,” marketing automation can help growing businesses continue to personalize their communications throughout their customer lifecycle. Small businesses pride themselves on their ability to know and send individual emails to customers, but this clearly isn’t sustainable as their database grows. By integrating CRM and customer data platforms software, marketers can not only automate repetitive tasks like scheduled messages and common responses, but also personalize messaging, content, and offers to each customer with minimal impact to team resources.
According to a 2020 report by ResearchAndMarkets.com, the global marketing automation market is expected to be worth $8.42bn by 2027, growing at a compound annual growth rate of 9.8% from 2020 to 2027. The recent acquisition of Mailchimp by Intuit is a further indication that marketing automation is set to become standard practice for brands connecting with their customers.
For CRM leads, this presents an opportunity to make every communication more relevant to every customer. However, we should proceed with caution: a “set it and forget it” approach won’t cut it. Journeys and automations must be regularly monitored and updated to ensure they align with the latest brand goals and, more importnatly, broader customer and cultural sentiment.
3. Digital cognitive dissonance
The third trend has been accelerated by the pandemic. The past two years have presented us with a dichotomy. On one hand, the need for connection to the outside world when navigating social restrictions has driven even more of our interactions online. Recent Pew research found that during the pandemic, 40% of Americans used technology or the internet in ways that were new or different to them, often in an attempt to maintain normal daily activities. Our shopping habits in particular saw a significant uplift in digital channels — and they show no signs of slowing as direct-to-consumer ecommerce sales keep soaring towards $151.20bn this year (an increase of 16.9% compared to 2021), per recent eMarketer data.
All of this is a boon for digital marketers who have seen even more opportunities to collect behavioral data and target a captive audience.
On the other hand, this increased digital activity is not necessarily appreciated by consumers. 68% of Americans say that, while generally useful, virtual interactions aren’t a replacement for in-person contact. With consumers spending more of their waking hours online, being exposed to more digital brand communications, many “are becoming increasingly numb to conventional digital advertising and engagement... [reporting] frustration and negative brand association with digital advertising clutter that prevents them from reading an article, watching a video or browsing a website," per a report by the Harvard Business Review.
The challenge for marketers is to harness and activate against all this new data and powerful technology, without compromising trust by overstepping what consumers expect you to know about them — or by being insensitive to everything else going on in their lives.
Finding the human behind the data
It’s clear that in order to navigate the evolving landscape, modern CRM practitioners (and their businesses) need to view their customers not just as optimizable objects in a database, but as what they are first and foremost: human beings. By shifting our perspective, we’re reminded that a single or even a few data points don’t totally represent an individual. Instead, they signal a micro-moment in people’s broader lives.
Genuinely considering the human at the end of each data point encourages us to think in more empathetic ways about that individual – and, therefore, how our communications and overall brand are likely to be experienced. As we develop future communication strategies and customer experiences, it’s helpful to ask more human-centric questions to augment the data we already have:
? What else is going on in the customer’s life (personally and culturally) and how are they feeling in this moment as a result?
? What does success look like for the customer, and does it align with our brand's measure of success?
? How does a connection in this moment contribute to the customer’s long-term experience of our brand?
By using data to power a more empathetic and involved view of the human at the other end, we can develop more meaningful communications and impactful experiences. After all, we don’t really know you or what you want – but with a little help from our CRM, we could work towards getting there.
Adam Reader is head of strategy at M&C Saatchi One-to-One.