It’s no secret data silos are the enemy of all organizations and their marketing teams today.
Data isolation — in which one’s customer data lives in separate, fragmented solutions throughout their stack that don’t “speak” with one another or with other teams across the business who don’t share cross-departmentally — deters truly effective marketing.
It’s also no secret many business leaders haven’t addressed this issue within their companies.
A 2018 Gartner survey found 87% of business leaders believe their brands have “low business intelligence (BI) and analytics maturity” — a primary driver of data silos and, according to Gartner, something that “creates a big obstacle for organizations wanting to increase the value of their data assets and exploit emerging analytics technologies such as machine learning.”
In other words? Executives either don’t see data silos as a problem (unlikely, but possible) or simply haven’t prioritized data integration into a centralized system that would provide their marketing teams with the coveted (and critical) single customer view of all contacts (far more likely).
The lack of proper marketing technology, like a customer data platform (we’ll get to this in a bit), is certainly the biggest barrier to eliminating destructive data silos. But data collaboration is also essential to eradicating organizational silos and promote a culture of data sharing.
What are data silos, and how do they affect marketers today?
The basic siloed data meaning is the separation (whether intentional or unintentional) of crucial customer data in disconnected digital locations (mostly legacy martech like CRMs and data lakes, but data can also be kept separate from these solutions, like in spreadsheets and CLVs).
Organizations of all kinds — from DTC retailers to DMOs — experience data silos in some form or another. But it’s leading organizations that nip information silos in the bud as soon as they identify them to better enable marketing and prevent any issues for the team with their efforts.
According to a 2018 survey by technology news publisher DZone, just 2% of brands noted they are “completely effective at data sharing” (You read that right: 2%). That means a whopping 98% of respondents likely live with several damaging data silos throughout their companies.
This means these brands are ill-equipped for sharing information with one another, leveraging expertise from data-oriented teams. What’s more, their organizational structures are in dire need of repair to provide marketing and sales teams with the requisite view of data pertaining to their prospects and customers to perform their jobs up to their best abilities.
Meanwhile, it’s the businesses in this 2% that recognize the downfalls of data silos for their brands (e.g., wasted resources, like poor spending on advertising campaigns) and chose to address the problem head on before it exacerbated that you and your business should emulate.
What’s so bad about separating data in multiple systems?
“But is it really that bad to have data silos in parts of the organization? What could go wrong?”
In short? A lot.
For starters, the existence of siloed data, more often than not, means the solutions used to host your data (the usual suspects: CRM, data warehouse, ESP, adtech tools, etc.) don’t sync with one another or other software in your martech stack. That right there means you need to lean on IT, data science, or marketing ops to pull together custom lists if and when you need to get info on certain segments.
Sure, there will occasionally be the need to develop intricate segments that require a helping hand from your resident data scientist. But manual collection of customer data sets simply because said data is scattered all over your stack should no longer be a concern for modern businesses — particularly enterprise brands with distinct enterprise data integration needs.
What’s more, data silos can lead to duplicate information regarding existing and prospective customers when that data remains in disparate databases with no one — including marketing — the wiser.
We no longer live in the age of securing more customer data for the sake of quantity. Today, it’s about high-quality, routinely cleaned, up-to-date data that updates dynamically in real time and eliminates duplicate profile details that can derail efficient messaging and metrics like conversion.
Aside from the operational systems downsides of data silos, there’s also the financial impact.
It costs money (and usually lots of it) to have numerous systems host data. The storage costs of cloud-based big data solutions alone should be enough for your C-suite to recognize the problem and seek out a modern, centralized database where all customer data can be both unified and activated with ease — then retire legacy platforms as needed.
How can my organization eliminate its data silo mentality?
Marketing leaders continue to get more spend for their teams, the 2019 CMO Survey shows. And much of that spend rightfully continues to be allocated to analytics and database software.
The more CMO and other marketing execs recognize the need for more cohesive and consistent data consolidation — and prove to their bosses it’s worth it to consolidate — the more money they’ll be able to set aside for the appropriate martech investments that can gradually eliminate all data silos.
Having said that, a sufficient marketing budget won’t resolve your data silos instantaneously.
You and your team also need to develop new data integration and unifications protocols that prevent future silos from emerging, then train everyone within your organization on said protocols.
There are certain key characteristics modern, data-driven cultures have today:
- Data literacy training is provided to requisite teams and staff members regularly.
- Customer data objectives and KPIs are clearly laid out by brand leadership.
- Routine data cleaning (i.e., removing dated or inaccurate data) is a top priority.
- Employees have their data-related concerns and ideas heard by business leaders.
- Thoughtful martech evaluation is conducted to find the ideal central database.
- Departments don’t withhold important data sets from colleagues across teams.
That last point may seem like an obvious, but — believe it or not — some brands experience company culture issues due to internal competition over customer data access and control.
All it takes is one individual or team to claim “ownership” over certain data sets and databases to achieve their specific business goals to derail any hope for a true data-driven culture — one that sparks innovation across departments and, eventually, boosts one’s bottom line.
Ultimately, team leaders company-wide need to agree upon data-sharing and -storing standards that deter problems like this from arising between departments and ensure everyone’s on the same page.
Who should handle customer data after it’s been unified?
The only caveat to these discussions? Marketing must own and operate the main customer database.
That’s not to say other departments — sales, customer service, etc. — shouldn’t have access to data as needed. They will certainly need to leverage it at various points to better sell to prospects and support current customers. But too many cooks in the martech kitchen is usually a recipe for disaster.
“Since the customer database becomes your company’s primary source of value creation, everybody wants a piece of it,” AdParlor CEO Ben Legg wrote for Chief Marketer.
Thus, Legg recommended having “your best people leading” ownership of your customer database post-data silos, not multiple teams. Doing so both creates accountability and ensures only those who need constant data access have it at any given moment. (In the case of marketing, this is quite often.)
Thankfully, the CDP was created primarily so marketing professionals — adtech specialists, customer insights experts, acquisition marketers, and those in similar roles — could seamlessly integrate data from databases on their own and, in turn, take complete ownership of their brand’s customer data.
What distinguishes CDPs from other centralized databases?
Big data expert Edd Wilder-James noted the worst thing brands looking to integrate data into a central database can do is fail to get everyone who touches customer data involved in the migration process.
“The cross-organizational nature of integrating data means that unless you are working with the support of executive leadership, and leaders across business and IT, you will be frustrated,” Wilder-James wrote for Harvard Business Review.
Put another way? Your data integration strategy — from tracking your existing data silos to eventually landing on a particular technology to break them down — needs the green light from your CEO.
The good news is it shouldn’t be hard to convince anyone in your C-suite of the benefits an integrated database offers your business — or explaining why a customer data platform is the premier database.
“Shouldn’t we get a data management platform? It has our need right in the name: data management!”
If your executive team says this to you during your martech pitch, they wouldn’t be the first (or last).
Though a data management platform and customer data platform have mild overlap in functionality, the real differentiator for the latter is data integrity — one of the many downsides of DMPs.
Access to first-party, consented customer data — including data from broken-down silos — that enables real-time marketing to high-value individuals is a must for the modern marketer.
That’s exactly what a CDP provides.