Getting Personal with CDPs

Ben McDermott, lead consultant at Teavaro, argues that with the advent of GDPR, customer data platforms will usher in a new era in data use.

With new regulation, heightened consumer awareness and headline-baiting controversies, it is fair to say that personal data is very much this year’s hot topic. But it is one that digital marketers have been grappling with for years, both strategically and technologically.

As the GDPR deadline has loomed, it has been easy to focus on the losses. For media owners and advertisers, there are losses in freedom and functionality within their marketing stacks. For their ad tech partners, a loss of autonomy and ‘controllership’ have caused some to give up the game in Europe entirely (at least until they can figure out a better way). All-in-all, this and other developments – browser cookie default setting, for example – point to the loss of third-party data as a strategy.

But what of the gains? In Teavaro’s view, there are many to be had. Certainly the changes have been hard, and fast, to comply before the door slams shut. But if one aims beyond just ‘compliance’, then the GDPR’s requests for granularity, transparency and control – all former buzzwords that were actively sought out at marketing conferences – are very much aligned with the goals of digital marketers.

Of course, already mentioned is the impact on the third-party providers of ad tech services. But one technology has seen interest surge – the Customer Data Platform (CDP).

Take control
Why? Well, the fact it keeps the control with the lawfully-decreed data controllers might be part of it; unique to the ad tech ecosystem, CDPs do not begin pitches with: “We take your data and…” The first-party ethos points to the new data strategy. As platforms that create a persistent, unified customer database, dealing in single-customer views and accessible to other systems, CDPs allow companies to take control of their data future and move to a first-party data strategy.

CDPs also play well with others, a factor crucial to the need for quick gains that the rigours of digital marketing, and indeed GDPR, have brought. Rather than a replacement platform, CDPs are connectors, working with legacy technology, CRM systems and ad tech partners alike. A happy medium between nimble ad tech providers and in-house control, CDPs augment that which exists with that which is needed; to bring new functionality with respect to what has come before. As Luma Partners Brian Andersen pointed out… CDP vs. DMP is “not an or … its an and.” They do different things. They have much to learn from one another and a similar mission, namely personalization. (Source, Martin Kihn, Research VP, Gartner, writing on Ad Exchanger.)

Identity management
This brings us to identity management. The GDPR has only heightened marketers’ need for a “single source of truth about their data”, according to Chris O’Hara, from Krux, writing on eConsultancy, not least for the effective application of the data subject’s wishes. The functionality that allows CDPs – like our own at Teavaro – to gain traction is the capability to consolidate different types of identification data points and first-party data to create and activate customer profiles and valuable insights for digital marketing across multiple channels. With such functionality, Teavaro has been able to solve the GDPR permissions issue for its clients.

This is where the customer relationship rises in importance; the regulation requires data controllers to take control of the entire use of data, and not pass it (and thus the seeking of permission) down the line to agencies and ad tech partners as, notably, the IAB consent framework wants to. The idea that these partners demand media owners to collect consent on their behalf and yet maintain data controllership does not stand up to scrutiny. If no service relationship exists between the data subject and an agency or ad tech provider, then why would the data subject view them as a data controller? More simply, if they don’t control the permission, how can they control the data?

In his negative view of the CDPs’ efficacy, Martin Kihn at Gartner points out that ‘identity management’ is marketing shorthand for ‘cross-device’, and that “requires something that CDPs do not have: an identity graph”. But he is wrong: they do have this (or at least, Teavaro does). Using first-party identifiers. True, to expand that across the ecosystem will require alliances and co-ops, just as any identity graph. But unlike an ecosystem built on third-party opacity, the data owners will enter these partnerships as equals, and, most importantly, in control of their customer data.

This exposes another important reason for the rise of the CDP: first-party data activation. Just as the GDPR has put the customer relationship at the centre of the data question, it has restored the control of the data controller. Media owners and advertisers alike are faced with the conundrum that their siloes of data bring: how can we realise the value of the resource we have?

While DMPs were a step in the right direction, much of the third-party data partner ecosystem spirited that value away. And so, when CDPs provide the functionality to unlock that value, suddenly the painful transition from a third-party to a first-party data strategy does not appear as hard as once thought.

Advertisers and media owners alike should be focussing on a strategy that enables them to extract all the marketing potential of first-party data, utilising up-to-date, unified customer profiles to deliver better customer experience while improving engagement and sales. This can be achieved by partnering with providers that help bridge silos, not create new ones, and seamlessly connect in real-time, pulling data from different sources in a secure and GDPR-compliant way to create promising marketing insight. This is what CDPs can facilitate.

The data controllers – media owners and advertisers alike – are being compelled by GDPR to hold the customer relationship sacrosanct. This is hardly a loss to the scrupulous marketer. What’s more, the entire marketing ecosystem must do the same; another gain to the data controller. For the many marketers who seem to be struggling with the new data landscape, the way the marketing industry has responded, not least with new technology that fits new needs, should provide hope for the post-deadline future and beyond.