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.
According to Gartner, it’s also 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.”
(Translation: Silos negatively impact customer data analysis.)
And yet, many executives either don’t see data silos as a problem (unlikely, but possible) or simply haven’t prioritized integrating data sources into a centralized system that provides marketing with full access to data and the coveted (and critical) single customer view (far more likely).
The lack of proper marketing technology, like a customer data platform (CDP), is certainly the biggest barrier to both eliminating destructive data silos and helping day-to-day marketers share data across their organizations to improve operational efficiency.
What are data silos? And how do they affect digital marketers today?
The basic data silo definition is the separation (intentional or unintentional) of 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 and across different industries experience data silos (or, at the very least, inconsistent data in their myriad marketing technologies) in some form or another.
But it’s leading brands that nip data silos in the bud as soon as they identify them to better enable marketing and prevent any issues for the team with their daily 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: Only 2% companies deem themselves ‘good’ at sharing information about their customers across departments: from marketing and sales to support.
That means a whopping 98% of respondents likely have damaging data silos — which also means these businesses are ill-equipped for sharing crucial customer information with one another cross-departmentally and 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 companies in this 2% that recognize the downfalls of data silos for their brands (e.g., wasted resources, like poor spending on advertising campaigns) and address the issue head on before it exacerbated that you and your team should emulate.
What’s so bad about having siloed data in multiple marketing systems?
“Is it really that bad to have data silos in parts of the organization? We know our ‘cloud data’ is up there somewhere. What could go wrong for the business?”
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 datasets simply because said data is scattered all over your martech stack should no longer be a concern for modern businesses. Particularly for enterprise brands with distinct (and sizable) enterprise data integration needs.
Moreover, data silos can lead to duplicate information regarding existing and prospective customers when that data remains stuck in dated, disparate databases with no one in one’s business — including and especially the marketing team — 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, up-to-date data that updates dynamically in real time and deletes duplicate profile details that can derail efficient messaging and metrics.
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 data solutions alone should be enough for your C-suite to recognize the problem and seek out a modern, centralized customer 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 altogether?
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 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 datasets 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 boosts the 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.
Who should handle all our critical customer data after it’s been un-siloed?
The caveat to these discussions? Marketing must “own” the main customer database.
That’s not to say other departments — sales, customer service, etc. — shouldn’t have data access. They certainly need it to leverage better serve and sell to 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.
Legg recommended having “your best people leading” ownership of your 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. (For marketing, that’s often.)
Thankfully, the customer data platform 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 first-party customer data.
What distinguishes CDPs from other centralized marketing databases?
Big-data expert Edd Wilder-James noted in the Harvard Business Review the worst thing brands looking to integrate customer data into a central database can do is fail to get everyone who touches said 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.”
Put another way? Your entire data integration strategy — tracking your existing data silos across systems, eventually landing on a particular technology to break them down and unify your customer data — needs the green light from your CEO before commencing.
The good news is it shouldn’t be hard to convince your C-suite of the benefits an integrated database offers your business — or explaining why a CDP is ideal.
“But shouldn’t we get a data management platform instead of a CDP? It has our biggest need right there in the name: data management.”
If your CEO utters this during your martech pitch, they wouldn’t be the first (or last).
Though a DMP and CDP 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 and especially datasets extracted from broken-down silos and systems — that enables targeted, real-time marketing to high-value individuals is a must for the modern today’s marketing professionals.
And that’s exactly what a customer data platform provides.
Download our eBook to learn how data silos in the cloud suites deter marketing success — and why a best-of-breed stack built around a CDP is best for your brand.