Why Data Strategy Should Be Your New Year Resolution 

Data is playing a huge role in business today and it’s essential that businesses are taking a proactive approach to data ownership and data strategy. With ever discerning customers more in tune, proactively highlighting privacy laws and wanting transparency and control of their data, it can be easy for businesses to lose mastery of their data strategy, when in truth it should be at the forefront of their business strategy. 

Advancements in technology and consumer preferences are transforming the way companies collect and use data. Businesses are using the vast amount of data they are collecting via digital channels to understand consumer behaviour, improve engagement, and personalise promotion campaigns on a scale never seen before. With customers spending more and more time on their mobile devices, who knows what advances in technology will be presented next, and how businesses will need to be agile in not only collecting customers’ data, but the secure storage and use of it. There are many businesses that have used digital data collected from clients to transform their business practices, none more transformative than Amazon. Amazon has used data collected from its customers to personalise recommendations, improve search results, and optimise pricing. The company also uses data to understand customer behaviour and preferences, which has helped it to develop new products and services. 

Data Depreciation and First-party Data 

Concerns about privacy are causing consumers and regulators alike to restrict the collection and use of third-party data. Notable examples of this were the Cookie Apocalypse, Google announcing its abandonment of Universal Analytics in 2023 and more recently Apple launching its ‘Ask App Not to Track’ feature. With users’ digital footprints becoming increasingly fragmented across a growing number of devices and channels, it’s more difficult than ever for businesses to get a clear picture of who their customers are. This is where first-party data becomes so poignant for businesses. It’s often used in CRM systems such as the ones we at Caldere Associates can implement, or referral programs that tend to provide a more comprehensive view of the customer journey than third-party data alone, especially when it comes to identifying customers and prospects at different touchpoints along their journeys.  

Data can be used to understand consumer behaviour in real time. It helps businesses make more informed decisions about how to target customers based on their digital behaviour over time. That’s because first-party data is the only type of data that can be used to build a comprehensive customer profile. And it’s also the only type of data that can be used to build a comprehensive audience profile. It also helps businesses improve the way they engage with their customers through personalisation and targeted messaging based on what people have purchased, subscribed to or commented on in the past.   

With the eruption of data this has bought increased complexity and security issues, especially when it comes to data ownership. It’s a problem that can lead to brand reputation damage, legal issues, financial loss and more. Businesses must ensure they maintain control over their data while still getting the best possible insights from their customers. That’s where developing a solid data strategy comes in, this is by far the best way to build consumer trust. A data strategy should guide businesses in how to align their business goals with the objectives of a data management program and provide guidance on how to get there and this should be reviewed regularly.  

How to Reduce Data Leakage 

To reiterate, having a data strategy is essential for businesses to gain trust and understanding with consumers who have demonstrated that they not only dislike being tracked but also want more transparency. Data leakage is when data is leaked outside a business’s security perimeter or accidentally made public and becomes available to anyone who has access to it. Data may be leaked by malicious insiders or hacked through a third-party vendor’s system, either of which could lead to serious issues including financial loss, damage to reputation and legal liability.  

When large companies have data leakages such as Yahoo or more recently American Airlines, it leaves a negative impression on consumers and highlights to the forefront of their minds that they would like more control over their data. This encompasses how their personal information is being used by marketers and advertisers, consumers need to be reassured data leakages will not happen. 

To prevent data leakages from happening, businesses need a comprehensive data strategy. This should include how they will manage their digital footprint across all channels in order to protect themselves against external threats, as well as mitigate internal risks such as insider threats or accidental disclosure by employees. This can occur when employees aren’t aware of sanctioned security protocols when handling sensitive information. 

It’s time to get serious about data strategy and here at Caldere Associates, we can get you on the right track. Ready to put it at the top of your agenda for 2023? 

The future is here, let’s embrace it together and let’s start a conversation here.