In my last blog post, I described how touchpoint attribution (measuring the success of marketing programs across multiple channels) is one of the building blocks of cross-channel marketing. Obviously, this kind of marketing intelligence can only be obtained if there’s a repository of data from all channel sources, or a customer intelligence hub (CI Hub for short). This is one of the prerequisites for implementing true multichannel marketing.
CI Hubs have morphed from customer databases, data warehouses and data marts. Some think that CI Hubs evolved because customer relationship management (CRM) applications failed to deliver the promised 360-degree view of the customer. And yet, one more theory is that business intelligence (BI) applications were supposed to deliver customer intelligence across multiple data sources but have not succeeded as well. The reality is that none of our evolutionary systems are capable of delivering the bigger objective of consolidated online and offline information in a distributed way for multichannel marketing.
The movement to CI Hubs has been hastened by the widespread adoption of internet protocol (IP) for all application solutions. This, in-turn, drove more services into producing both interactive data sharing and entirely new application data sources. These rapid electronic interfaces and exchanges of electronic data haveand continue to open up new interactive channels to users. As these new channels (such as tablet apps, interactive TV, social media, etc.) are available to the end users, those same channels become available for marketing. The CI Hub of today needs to consolidate information across all these interactive channels and be flexible enough to grow as development of these channels continues to skyrocket.
What is a CI Hub?
A CI Hub is a central repository that holds accurate data from all marketing sources which includes both online and offline information. Ray Wang, from Forrester Research, described Customer Hubs as a supply chain “that address the up and downstream flow of key customer data across a range of stakeholders and business processes.” Today, as businesses quickly adapt Software-as-a Service (SaaS) technology, the data is not always centralized as it is in a data warehouse. However, it still has to be accessible when needed. A new buzzword is being used to describe this model – “data as a service.”
In a previous article about corporate silos' effect on multichannel marketing, I described some of the technical and cultural hurdles to adopting CI Hubs, such as:
- Poor data – CRM and BI systems have failed at a high rate in large part because of poor data quality. The need for Master Data Management (MDM) quickly becomes apparent, as disparate data sources are brought together for a single view. That becomes a problem when data is all in-house, in-that adding outside data sources magnifies the problem. Unlike the adoption of IP standard, adoption of Master Data standards has not yet occurred. All these new interactive channels are producing data for which there isn’t assurance that the master data of one is equivalent to the master data of another.
- Data ownership – Some business managers are reluctant to give up control. Data governance issues often turn into political battles over who owns the data, usually because the owner can keep score over what works. Combine this with any in-house applications being developed that are driven by these disparate data ownerships, and it will likely create dissimilar master data.
- Functional silos – Since many of the marketing channels are organizationally housed in corporate silos, the data is often hard to get to. Not only are there battles over ownership as just described, there are often separate organizations and even outside suppliers that must relinquish control. Looking back over the legacy silo mentality, once front- and back-office system integration is required, it will also require a new overall owner. This new owner or "master silo" will strive to achieve efficiencies in marketing automation, customer insights, customer retention and acquisition, increased average order value, strategic multichannel messaging, and so on.
The Web Drives Data Integration
Despite these obstacles, the movement toward CI Hubs is growing because the number of new touchpoints, which are principally web-based marketing channels, continues to grow. Joe Stanhope of Forrester Research, in his analysis “How Web Analytics Will Emerge as a Cornerstone of Customer Intelligence,” says that “web sites, microsites, landing pages, communities and other interactive properties are mission-critical for acquiring, retaining, and nurturing customers and other target audiences.” They also generate a lot of data. Web analytics providers, as a way of extending the reach of their products and driving additional revenues, have launched online marketing suites that integrate multichannel campaigns. But their biggest potential is in integrating data. If these technologies can integrate all or most of the online data, then the job of merging it with offline data becomes easier (not easy – just easier). According to Stanhope, web analytics providers will become the glue that brings together all online data.
Well maybe, if they also can remain flexible enough to accommodate the next yet-unknown sources of new online methods and deliveries.
Incorporating Offline Data
Forrester Research has stated in several research projects that 53% of US online customers research products online but buy offline. Having this data is crucial in the new world of Marketing 2.0. Operational, customer and campaign history must be combined with the online data described above. This marketing intelligence will have many applications. For example, customers’ recent website visit information, social media acitivity, usage of retail outlets, etc., could all be passed to customer service agents at call centers who can more effectively match customer needs with appropriate actions. We might also look at customers' online activity as a test market before launching a bigger, multichannel campaign. As more and more of the offline data is captured and integrated with online and cloud-based data, it will further drive the CI Hub movement.
Clearly, CI Hubs are more than just a new trend. They may not be perfect yet, but they are a fundamental under-pinning of multichannel marketing. Without consolidated data, it’s almost impossible to launch cross-channel marketing efforts and have marketing metrics that show success by channel and combinations of channels (touchpoint attribution). In my third and final post in this series, I will look at customer engagement and multichannel marketing strategies that can be built with CI Hubs and analyzed with touchpoint attribution.
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