As consumers go digital, companies are struggling to keep pace with accompanying data challenges to serve them effectively.
Today's consumer has an array of options from which to choose to research and purchase products: they can shop in-store or online, via a mobile phone or research products on a blog or community site for reviews. Consumers may also commune with peers on community sites or on blogs and social media sites. Or they may use mobile wallet technologies to pay for products and receive discounts.
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And today's discerning customers want to be able to traverse these channels seamlessly: to browse products online, then pick up in-store, or call a customer service line without companies missing a beat on integrating these actions and seeing them as a single customer despite their use of multiple channels.
But the reality is that the ability to create a seamless omnichannel experience is still a distant goal for many enterprises. Companies often lack the technology -- and the organizational culture -- to effectively stitch data together. As a result, they are often handicapped in customer service, operating with a fragmented view of their customers and data siloed in various locations.
Indeed, according to "Customer Desires vs. Retailer Capabilities: Minding the Omnichannel Commerce Gap" by Forrester Consulting, 40% of companies struggle to integrate back-office applications that house this data. The cost of achieving an omnichannel experience may be one of the barriers. According to the "Global Retail & Consumer Goods Survey," only 19% of top retailers said that they can operate an omnichannel experience profitably.
"Multichannel is a promise," said Stuart Sim, a director in West Monroe Partners' Advanced Analytics practice, "but you can't deliver on the promise until you solve for the challenges of accumulating, collecting, making sense of and normalizing all the data streams you have access to."
Data silos and the omnichannel experience
At Rock/Creek, a specialty outdoor retailer based in Chattanooga, Tenn., the company has welcomed the year-over-year growth that increasing interest in outdoor activities has brought. But with expansion there have been pain points in integrating customer data from various data silos.
Mark McKnightMarketing and e-Commerce Director, Rock/Creek
The company wants to serve customers online, in stores and at in-person events. But with the proliferation of channels has come the albatross of customer data silos that can't talk to one another. Rock/Creek has a database for its point-of-sales system (POS) in its physical stores. It has another for its e-commerce system for its website, which uses the Oracle e-Commerce platform. Yet another set of siloed customer data resides on a sister site, RootsRated, which offers information on outdoor activities for customers; another silo resides on its Chronicle blog. It also hosts live events, and its event management software houses yet another silo of data.
Add to these multiple digital data silos the fact that Rock/Creek store associates have no sense of the digital activity of patrons on these sites when they enter a store, and you have a data silo riddle that needs solving, said Mark McKnight, marketing and e-commerce director at Rock/Creek.
McKnight said that the company wants to establish better data sharing. One way is by better managing customer data through email address. By using email addresses to link online activity with in-store activity, sales associates could better help customers. So, for example, if a Rock/Creek store could link email address information from a customer making a purchase in the store with their prior activity on the Rock/Creek site or RootsRated, customer service could get a boost.
"There is a limited amount of data exchange happening between RockCreek.com and RootsRated and a limited amount for our brick-and-mortar stores, if we can match an email address," McKnight said. "We want to have visibility into who is visiting the store," he added.
West Monroe Partners' Sim said that aggregating this data into a single 360-degree view of the customer is the most important first step in addressing the multichannel challenge. "If you have the same customer sitting in different databases … that you can't cross-correlate with master data management [MDM], then, you're facing a big challenge," he said.
Getting the data house in order
But there is more work to do to create a truly seamless customer experience. McKnight envisions a time when a customer can research trail hikes on RootsRated, then, in the same screen, receive hiking gear recommendations, click on an Add to Cart option and buy those products without being bounced from site to site. Today, customers have to travel between sites and the experience is more disjointed. Another multichannel scenario that would eliminate friction in the customer experience would enable mobile payment in stores, so customers could pay with their smartphones and Apple Pay or PayPal at checkout -- but today, the company's POS doesn't support mobile payment.
"Mobile payment would be great -- especially as 20% of traffic on our website checks out with PayPal," McKnight said.
According to McKnight, many customers may already have established PayPal accounts and could use their balance -- if they could accept mobile payment. "A lot of our customers have piggybanks already in PayPal and that is their budget after they sell their last generation of gear on, say, eBay. If you could make their PayPal balance available in-store, it would already be available for them to pay." But these kinds of data integrations are still off in the distance.
McKnight also said the company is considering the best form of unique identifier for customers. So, for example, should customer identity center on customer email or does it make more sense to use other information, such as a mobile phone number?
Sim said that companies can avert some of these issues by pairing traditional approaches like MDM going with a data virtualization approach. Then customer identities are tied to specific data, he said, but instead data virtualization software creates a layer of abstraction above the real data to represent that customer identity regardless of redundancies or inconsistencies.
"I shouldn't care where the ones and zeroes are stored for representing my customer," Sim said. "I just have a virtual data representation. You then have a true picture that sits above your internal systems."
Segmentation and personalization
Teri LamitieDirector of Digital Marketing Products and Services, WGBH
For some companies, the effort to get closer to the "omnichannel mandate" is only partly a story about bringing technology sophistication to bear. Another critical issue in achieving an omnichannel experience is organizational culture.
At WGBH, a public media station that creates local and national programming, customer data silos were hobbling the company's efforts to communicate effectively with donors. It used Oracle's Eloqua for marketing automation and Salesforce for its member database, but the two data sources couldn't communicate with each other. So WGBH might send out tone-deaf messaging about programs like Downton Abbey or Frontline that a prospect had no interest in or could treat a longtime donor like a first-time contributor. It needed better connection between its audience's behavior and preferences, and its messaging.
"We had a marketing automation system where we were capturing data on our website and through email, but we couldn't marry that with membership data in a meaningful way," said Teri Lamitie, director of digital marketing products and services at WGBH.
Using RedPoint Global's data management software, WGBH became able to discern behavior among its donors and prospects, and target communications based on audience behavior. So, for example, prospects or donors who visit the WGBH website and spend time on the Nova site might receive certain messaging based on their interest in that program and in science. RedPoint is integrated with the website, so marketing and membership teams can target their communication and coordinate their email campaigns and direct mail campaigns. RedPoint helped connect the dots, where Eloqua had left email marketing and direct mail campaigns stranded in their respective silos.
"We couldn't take a person's action with a piece of direct mail and have that trigger our next email communication," Lamitie said. Today, for example, the marketing team can contact a donor who hasn't responded to direct mail after three weeks and tailor communication with that donor based on his behavior -- and then create a customer journey map, or template of expected customer behavior -- to map how to communicate with that customer. "Being able to know they haven't communicated with us in a while and produce a communication about re-engaging with them has been really successful," she said. "With our old system, we would know they were lapsing, but we wouldn't have been able to act on it."
Connecting the dots between customer preferences and communications has become critical to efficiency. Before RedPoint, WGBH was able to send out roughly 200 marketing campaigns. That number has quadrupled -- with no additional headcount being added to the marketing department.
"It means less time spent physically having to do something and more time spent planning strategically what is the right communication and what is the right time for a donor to get it," Lamitie said.
That problem of 'culture'
Lamitie said that, ultimately, effectively bridging data silos in the service of customer experience is about making a cultural shift within an enterprise. It's about recognizing that intra-departmental communication and coordination become critical to enabling the technology.
Stuart SimDirector, West Monroe Partners
In the past, WGBH's digital marketing and membership teams, which handle the direct mail campaigns for donors, could operate more independently, but now they need to work in lockstep and plan campaigns together. So, for example, the marketing team needs to know when a direct mail campaign will drop, then tune its email messages in the weeks that follow to prod lapsed donors or entice new prospects. The timing and tone of those messages should be calibrated in accordance with the membership team, not in a marketing team silo.
"If you're going to bring in omnichannel, it's not just the tools," Lamitie said. "It's really the culture of the organization that allows you to make this happen. It's a lot of work across teams. We have to now work together in a different way. We have to collaborate earlier."
Lamitie said that enterprise cultural barriers exist, even with overwhelming executive support for these initiatives. Experts say, though, that executive-level recognition that data integration is a business, not an IT problem, is a critical step in eliminating the isolationist culture that entrenches data silos.
"Reconciling customer records has gone from an IT problem and has risen to a business-critical problem," Sim said. "Everybody recognizes that … address[ing] the customer's needs [are] essential. It has moved from a data issue to a critical business focus."
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