How Data Standards Are Impacting Opportunities For Marketers

The Growing Importance of CDP and CMS in Marketing

First-party data has become a high priority for organizations due to privacy regulations, compliance needs, signal loss and the pressure to increase Return on Ad Spend (ROAS). Consequently, businesses are prioritizing data strategies and supporting tech stacks, leading to new use cases for CMS and CDPs.

Yet, the potential of these platforms is often underutilized due to outdated data practices and a lack of standardized data transfer methods. The siloed operations of marketing, IT, sales and other departments create a language barrier for data, presenting challenges in deriving insights across the enterprise.

The Impact of Poor Data Quality

According to Gartner, poor data quality costs businesses an estimated $15 million annually. This, coupled with economic uncertainty and tighter marketing and advertising budgets, is a recipe for trouble. It’s high time for organizations to align their data strategies to weather this storm.

Common Data Challenges

CDPs and CMS systems often face issues due to inconsistencies in the data they receive. These inconsistencies can impact campaign ROAS, hurting ROI and profitability. One common challenge is campaign tracking, which can become messy due to inconsistent or missing tracking codes and parameters.

Moreover, the lack of an enterprise data taxonomy can also lead to wasted content and creative efforts. When data standards are applied to digital assets and webpage data, discovery, automation, personalization, and analysis become much easier.

The Need for Data Process Upgrades

Organizations cannot control industry trends like signal loss, cookie deprecation, and privacy regulations that shape data usage. However, they can control how they organize and use data. Considering the industry realities and economic uncertainties, implementing a better data governance process should become a business imperative.

The CDP Identity Crisis

Customer Data Platforms (CDPs) are facing an identity crisis. While marketers have heavily invested in martech to support personalization, they are forced to reevaluate their investments due to a changing regulatory and technology landscape. Can CDPs help marketers manage data with rigor, or must they adapt their ad tech and mar tech away from silent but efficient data harvesting tactics?

The Role of Data Standards in CDP and CMS

To address the challenges posed by data inconsistency, organizations need to establish data standards within their CDP and CMS. Data standards provide a common framework for data collection, storage, and analysis, ensuring that data is uniform, accurate, and easily accessible across different platforms and systems.

By adhering to data standards, organizations can achieve several benefits:

1. Data Enrichment and Personalization: Standardized data enables organizations to enrich customer profiles with additional information and provide personalized experiences. This includes tactics such as personalization, loyalty programs, and targeted marketing campaigns.
2. Improved Data Analysis: Standardized data allows for more accurate and comprehensive data analysis. Marketers can gain deeper insights, identify trends, and make data-driven decisions based on reliable and consistent data.
3. Enhanced Cross-Channel Optimization: With standardized data, organizations can optimize marketing efforts across multiple channels and touchpoints. This includes delivering consistent messaging, tracking campaign performance, and measuring ROI effectively.
4. Efficient Collaboration: Data standards promote collaboration and alignment across different teams and departments. By establishing a common language for data, organizations can break down silos and facilitate cross-functional collaboration.

The Role of Chief Data Officer (CDO)

The accelerating trend of digital transformation, spurred by the impact of the COVID-19 pandemic, is driving organizations to evolve their customer data management practices. The office of the chief data officer (CDO) is gaining more focus, forcing marketers to address their model of engagement with the wider organization. This necessity will impact marketers’ involvement and influence on customer profile management.

The Need for Collaboration and Industry Standards

Establishing data standards within CDP and CMS requires collaboration and industry-wide efforts. Marketers, technology providers, and industry organizations should work together to develop and adopt standardized data practices. This includes defining data schemas, data governance frameworks, and best practices for data integration and interoperability.

Additionally, organizations should invest in training and education to ensure that their teams have the necessary skills and knowledge to manage and leverage standardized data effectively. By promoting data literacy and awareness, organizations can maximize the value of their CDP and CMS.

The Varying Perceptions about CDPs

As marketers grapple with understanding the changing landscape of CDP technology, the category’s target customers are also evolving. Despite 66% of marketers classifying CDPs as a “strategic priority”, many find such technologies fall short of requirements. The confusion over what constitutes a CDP and the varied set of use cases and expectations among marketers are partly to blame.

The Importance of Standardization and Implementation

For a CDP to be effective, it’s not just about the technology, but also about how it’s implemented. If the people who are supposed to use the platform are not engaged in the project, they are likely to be unhappy with the result.

Conclusion

It’s apparent that there’s a need for more clarity and standardization in the use of CDPs and CMS in marketing. Businesses must strive for better data governance and engage all relevant parties in the implementation process. By doing so, they can overcome the challenges and fully exploit the potential of these platforms for effective marketing.

References & Further Reading

• The Lack Of CDP And CMS Data Standards Leads To Missed Opportunities For Marketers
• Are CDPs Having An Identity (Resolution) Crisis?
• The vast majority of marketers are unhappy with their Customer Data Platforms, but then again, not many are sure what they really are