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Enterprise decision-makers know offering a great customer experience (CX) is critical for creating a competitive advantage and boosting customer loyalty. Company leaders also now understand that personalized experiences are essential for better CX, and effective digital identity management can strengthen personalization.
But it's also become clear that traditional customer identity management methods aren't viable. Organizations must pursue new, inventive solutions for digital identity management—like first-party identification.
What is digital identity management?
In digital advertising, digital identity management refers to the collection, processing, storage, and use of prospective or established customers' data—typically browser or device activity—to support various marketing campaigns.
Businesses need to track customer activities and identities to offer better recommendations and, strengthen conversions to ultimately drive bottom-line gains. At the same time, today's consumers want good CX across all digital channels while shopping and the confidence that their privacy is respected. Modern digital identity solutions for marketing must effectively address all of these concerns.
Searching for new identity solutions
The shift away from third-party cookies—long a cornerstone of advertising tech and digital identity management—began in the early 2020s.
Driven by Google's announcement that Chrome wouldn't support third-party cookies after 2022, businesses, publishers and adtech firms had to find alternatives, as all other prominent browsers—Safari, Firefox and Microsoft Edge—eliminated cookies years ago. The following are some of the methods enterprises have pursued:
First-party identification
First-party ID tools rely on data collected during direct interactions with enterprises' websites and other channels. Email addresses obtained from newsletter sign-ups or surveys and login data generated when website visitors create user accounts are particularly valuable for first-party ID.
Universal IDs
These tools typically create unique user identifiers by combining data from major adtech consortiums with online and offline first-party data. While universal IDs usually avoid using third-party cookies, some still do, so publishers and advertisers haven't broadly adopted tools from major universal ID vendors.
Non-authenticated ID
This type of ID uses IP addresses, browser user agents, timestamps, and device signal data to create an ID without relying on cookies, email addresses or other personal information. Tools like these can be useful for attracting new customers. But they're probabilistic rather than deterministic, based on data that isn't concretely tied to customers. Also, some of these methods bear some similarities to device fingerprinting and thus can be controversial.
Blockchain
Best known as the tech foundation of cryptocurrency, blockchain has generated some interest as a digital identity management method. The technology verifies identity by matching a unique public identifier to a private key visible only to its user. However, because of this hyper-specificity, digital identity blockchain tools may be most effective outside of marketing.
Embracing first-party ID management
First-party ID is an ideal solution for modern marketing needs in comparison to traditional cookie-based strategies, contextual targeting and even the largely cookie-free methods outlined above. Identity management tools that leverage first-party data are increasingly regarded as more comprehensive, accurate, relevant, cost-effective, and easier to control than their third-party counterpart.
Reasons behind the growing trust in first-party data for digital marketing and advertising include:
Real-time accurate insight
First-party data points can be collected and aggregated into visualizations known as identity graphs. These are exhaustive and integrated views of a consumer's activity across multiple channels and devices, and can be updated in real time to serve as a true single source of truth for each individual.
Compliance through consumer choice
Using first-party ID keeps organizations in compliance with modern data collection regulations that heavily emphasize privacy. First party digital identity management solutions are based on information customers voluntarily share—the aforementioned email and login data as well as interactions on social media channels and direct website traffic.
No tag-related complications
Tagging-based ID solutions—which include universal IDs as well as cookie-based tools—collect data that is often difficult to structure, lacks individual-level insight, and may not even be accurate. By contrast, first-party ID is deterministic and always centers around individual customers.
First-party digital ID management strengthens CX
Detailed, granular first-party digital identity management allows organizations to target marketing efforts precisely. Potential, new, and established customers experience your website and other channels in a way that's most likely to direct them to desired products or services.
There are tangible, bottom-line benefits to strengthening CX through a first-party ID approach. For example, a major global retail bank that used a first-party ID graphing tool as its digital identity manager saw a 50% increase in click-through rate and $50 million revenue boost. Other enterprises taking this approach have personalized the majority of their website content in ways they never previously imagined, leading to improved conversions as well as valuable fringe benefits like fraud prevention.
How do you manage your digital identity needs for marketing?
To effectively manage the large volumes of data necessary for the proper use of first-party data across campaigns, enterprises need a first-party ID solution that can capture and manage customer data in real time. The key is to create more personalized CX while upholding security and privacy.
Teradata and Celebrus offer a cutting-edge first-party ID graph that is integrated within Vantage, Teradata's comprehensive data analytics platform. This approach to digital identity management allows any organization to leave behind the inefficient, privacy-infringing marketing methods of the past and embrace the cutting edge.
Learn more about digital identity management