As the volume of customer data continues to grow, companies are turning to customer data platforms (CDPs) to help them manage and make sense of all that data. One of the most important features of a CDP, which should be seriously considered when choosing a CDP for your business, is its ability to match and link customer data from different sources to a single, unified view of the customer. This process is known as identity resolution, a critical aspect of customer data management. In this article, we will take a closer look at identity resolution and how it can help companies to improve their marketing and sales efforts, personalize customer interactions, and comply with data protection and privacy regulations.
Identity resolution is a process used by customer data platforms (CDPs) and composable customer data platforms (CCDPs) alike to match and link customer data from different sources to a unified view of the customer. It involves identifying and merging different data points that belong to the same customer, such as different email addresses, phone numbers, or device IDs. The goal of identity resolution is to create a comprehensive view of each customer that includes all available data about them, such as demographic information, purchase history, and behavior.
The Identity Resolution Process
The identity resolution process can be challenging, mainly when dealing with large amounts of data from various sources. There are different methods and algorithms that CDPs use to resolve identities, such as deterministic matching, which uses a unique identifier such as an email address or a customer ID to match data points, or probabilistic matching, which uses machine learning algorithms to compare and match data points based on similarities.
Once the identity resolution process is complete, a CDP can use the resulting unified customer profiles to improve marketing and sales efforts by providing a more complete view of each customer. This allows companies to better understand their customers’ behavior and preferences, and personalize their interactions with them.
Identity resolution is also a important aspect of data privacy and security, as it allows companies to ensure that they are not collecting, storing, or using duplicate data or data that belongs to the wrong person. This can help companies to comply with regulations such as GDPR and CCPA, which have strict requirements for data protection and privacy.
Recommendations for effective an Identity Resolution strategy
When collecting user identification data points for a customer data platform (CDP), there are several recommendations to keep in mind:
- Use unique identifiers: It’s important to use unique identifiers, such as email addresses or customer IDs, to match and link customer data from different sources. These identifiers should be collected at the earliest possible point of interaction with the customer, such as during registration or checkout.
- Use multiple data points: Collect multiple data points for each customer, such as names, phone numbers, and addresses, to improve the accuracy of identity resolution. This can also help to ensure that you have enough information to identify a customer in case one data point is missing or incomplete.
- Be transparent: Make sure to be transparent with customers about what data is being collected and how it will be used. Provide them with clear privacy policies and opt-out options, and obtain their consent for data collection and usage if required by regulations.
- Use data encryption and anonymization techniques: When collecting sensitive data, use data encryption techniques to protect the data from unauthorized access, and anonymization techniques to remove personal information from the data. This is important to maintain compliance with data protection regulations such as GDPR and CCPA.
- Consider data governance: It’s important to have a data governance plan in place to ensure that the data collected is accurate, complete and up-to-date. This includes regular data quality checks, data cleansing processes, and data retention policies.
- Consider data privacy regulations: It’s important to be aware of and comply with data privacy regulations such as GDPR, CCPA, and HIPAA. This includes obtaining consent, providing transparency, and providing customers with the right to access and control their data.
- Consider data integration with other systems: Collecting data points is one thing, but in order to have a complete picture of the customer, it is important to have the capability to integrate with other systems, such as CRM, marketing automation, or analytics platforms.
By following these recommendations, you can ensure that the data collected for your CDP is accurate, complete, and compliant with data protection regulations. This can help to improve the effectiveness of your marketing and sales efforts, and provide a better customer experience.
In summary, identity resolution is a critical aspect of customer data management and an important feature of CDPs. It allows companies to create a single, unified view of their customers, which can be used to improve marketing and sales efforts, personalize customer interactions, and comply with data protection and privacy regulations.