2016 promises to be a year of enhanced development in the customer identity and access management (CIAM) space, with customer experience, data privacy and personalization proving to be increasingly critical components of business success.
We’ve outlined five identity-related trends we foresee taking hold in the new year, the first of which I covered in last week’s blog. This week, we’re examining our next two predictions.
Prediction #2: Global enterprises will adopt multiple international data centers to remain compliant.
2014 saw the mandate that all Russian citizens’ data must be stored within Russian borders. 2015 saw the invalidation of the EU-US Safe Harbor agreement. And 2016 will see leading enterprises adopt multiple data centers across the globe to adhere to localized data privacy regulations.
Additionally, with international enterprises now required to manage their users’ data in multiple geographies and support unique scenarios like users moving from one region to another, on-premises storage of consumer data is becoming increasingly costly and unfeasible. The growing need to comply with new and evolving regional data regulations will also drive businesses’ on-going migration to cloud-based identity and data repositories.
Prediction #3: Data brokers’ revenues will decline due to brands focusing on first-party data.
Data brokers have built a multi-billion dollar industry dedicated to sourcing and selling consumer information from a variety of places, including surveys and questionnaires, public records like voter documentation, enterprise insights from loyalty programs and more. However, modern brands are finding that these third-party consumer profiles are often outdated, limited to device-specific insights and simply inaccurate due to being pieced together from a variety of disparate sources.
Uncertainties regarding the accuracy, completeness and origins of this data make it nearly impossible for marketers to know exactly who they’re reaching and to effectively measure the success of their campaigns, causing more brands to turn to first-party data. Because it is collected directly from customers and takes multi-device activities into account, first-party data is much more reliable than third-party data.
In addition to being essentially free to collect, first-party data lowers campaign costs by enabling marketers to target audiences with highly relevant messaging. This minimizes the number of impressions it takes for users to engage and driving conversions at a faster and higher rate. For these key reasons, we predict that 2016 will be the year that data broker revenues begin to decline.
To hear all five of our predictions, download our most recent webinar On-Demand: 2016 Consumer Identity Predictions.
By Patrick Salyer