The following is a guest post by Jonathan Margulies, Managing Director of the Winterberry Group, and originally appeared in “Know Your Audience: The Evolution of Identity in a Consumer-Centric Marketplace“.
Marketing is in the midst of a paradigmatic shift, with a new, unified focus on audience identity emerging as the linchpin of marketing insight, measurement, and attribution, media optimization and, perhaps most importantly, the delivery of better individual customer experiences. To that end, our extensive research process revealed:
Identity solutions commanding growing attention, investment: Once the exclusive domain of marketing technologists and data junkies, “identity” has rapidly grown to represent a key business priority for enterprises and smaller businesses alike. 58% of survey respondents said that their company has intensified its focus on identity over the past year, while nearly half (47%) reported their organization will invest more on identity solutions over the coming 12 months.
Still much room to improve: Marketing practitioners are severely gapped when it comes to the tools, data and expertise needed to recognize audiences across all addressable touchpoints; only 15.3% of respondents said their organization is able to identify their audiences accurately and consistently today. More than anything else, respondents said they need help building a clear business case for the benefits of identity solutions—as well as general guidance on how identity can support broader business objectives,
Complexity—the root cause of today’s identity challenge: The identity “performance gap” is largely grounded in issues related to the complexity of marketing in the modern age. In particular, the proliferation of connected devices and new digital touchpoints have shifted marketer attention to identity solutions as means of recognizing, understanding and appropriately engaging consumers across an increasingly varied and complex customer journey.
Early days for focused identity solutions: Dedicated identity-oriented technology platforms, managed services and data assets—commonly taking the form of device graphs, onboarding solutions and customer data platforms (CDPs)—are rapidly emerging to help marketers address a range of use cases. But relatively few survey respondents—just 13.4% in the case of device graphs, for example, and 27.4% in the case of onboarding solutions—said they’ve implemented such solutions and realized value from the deployment. By contrast, CRM databases (cited as in-use and driving value by 57.7% of respondents) and other established tools continue to represent centerpiece identity tools for many.
Insights and Segmentation for paid media targeting dominate primary use cases today, though personalization on owned properties and attribution emerge: Panelists and interviewees were united on a common theme: building better solutions to identify audiences has the potential to serve many business purposes. While the most popular application of identity solutions to date has been “insight development for segmentation and targeting” (cited as an in-progress use case by 53.5% of respondents), the same marketers say that a diverse array of applications—most prominently cross-channel attribution and dynamic content personalization—are likely to emerge as key focal points of their identity efforts in the years to come.
Privacy looms large: Recent regulation (specifically the EU’s General Data Protection Regulation and the California Consumer Privacy Act) have sharply focused marketer attention on the guidelines defining the responsible collection and use of data. But while this new focus has served to clarify certain parameters dictating ethical data use, there are still many unanswered questions and contrasting policies, suggesting that “the privacy imperative” will remain a fundamental pillar of all audience identity strategies—and thus a core embedded function of all corresponding identity solutions—for the foreseeable future.
Identity expenditures are rising rapidly today and will continue to outstrip marketing growth: U.S. marketers will invest nearly $900MMthis year on services and solutions focused on solving exclusively for identity—including device graphs, data processing/management platforms and services—with that investment growing to over $2.6BBin 2022. Much of that growth will be fueled by marketers leveraging identity in support of diverse use cases including personalization for the Web, mobile, TV and other traditional media channels—driving, in kind, the convergence of the “identity solutions” landscape with the rest of the marketing data and technology ecosystems.
This report was put together with the help of our premier sponsors Acxiom, Drawbridge, Experian, LiveRamp and Signal, our support sponsor Throtle, and in partnership with the Winterberry Group
For more information on on the report, click here