Data-Driven Marketing Transformation Guide: 10 Steps to Build a Winning First-Party Data Marketing Strategy

May 29, 2023

Our DELVE CMO Survey Report showed some promising — and troubling — trends among top marketing leaders around the globe. One thing is clear: Leading brands are accelerating their digital marketing transformations and rapidly activating first-party data to drive next-generation marketing strategies. No matter where your organization is at today in terms of marketing transformation, there are clear best practices for building and executing winning first-party data strategy. Here are 10 tips that DELVE has honed through our extensive experience:

1. Start with goals that connect marketing transformation to broader business strategy.

Any major business initiation needs a direct link to the brand’s overall strategy. Marketing transformation is no different. To start, think about the benefits you hope to get from your first-party data. That value starts with understanding your core customers, but it may also include identifying waste in digital marketing, understanding conversion drop-off in the customer journey, or enabling greater personalization and a better user experience. 

Then, look at how first-party data can enable you to go deeper with those goals. For example, you can zoom in on your ‘best’ customers, going beyond looking at the ‘typical’ customer journey — instead seeing the full journey taken by your ‘best’ customers. Or, you can go deeper into achieving RoAS targets in digital marketing by focusing focus marketing investments on customers with the highest LTV. One more example: You can analyze personalization initiatives through the lens of activities that increase your share of wallet within your ‘best’ target customer set.

2. Identify all sources of first-party data in your organization.

Lots of companies want to jump right into activating first-party data. That’s certainly the fun part. But that’s the “run” step in the “crawl > walk > run” framework. Moreover, jumping right to activating some portion of your first-party data is like leaving the gas station as soon as you get a few drops of fuel in your tank. Before you get going with activation, you need to make sure you’ve identified all your sources of first-party data — from your website, CRM, call center, media agencies, online and offline — so you’re starting with a full-color, 360° view of your customers.

The work here is determining where all this data lives and understanding the metrics and dimensions of various data sets. In most organizations, we find these data streams are siloed — and no one person in the organization has 360° visibility of all first-party customer data. This is where an experienced partner like DELVE can provide a helpful external perspective to ensure you’re capturing the full customer view. 

3. Create data hygiene processes to transform raw data into a consistent, ready-to-use ‘fuel.’ 

Collecting all your first-party data is a major undertaking. But you’ll likely find that much of that data lives in raw, unstructured formats that can’t readily be fed into analytics tools and AI-powered customer journeys. First, you need to clean up your data, deduplicating and bringing consistency to formatting to create ready-to-use ‘fuel’ for your marketing engine. 

This sounds like a technical and logistical box to check off, but it’s actually critical in getting cultural buy-in for your first-party data-driven initiatives. That’s because if your business users don’t trust the quality and validity of your data, they won’t trust the insights that come from that data.

How do you build that trust? Be incredibly thorough in your data hygiene practices, understanding every metric and dimension of your data. And be extremely transparent with all internal users about how you’ve executed these thorough data hygiene practices. Prove the ‘cleanliness’ of your data to your users.

4. Connect all data in one place: Build your data lake or customer data platform.

Once you’ve identified all the data you need to integrate and built processes for cleaning up that data, it’s time to connect it in a single repository. We always recommend brands start their first-party data journey with a centralized data lake. A data lake is a powerful form of repository that serves many organizations well on its own; it’s also the ideal stepping stone to creating a full-blown customer data platform (CDP).

Here are a few tips for creating your data lake or CDP:

5. Integrate your data lake/CDP data with your MarTech and AdTech stack.

It takes a lot of work to pull all your first-party data streams into your data lake/CDP. But that data lake can’t be a dead end — you need to connect it to your MarTech and AdTech tools to make that data drive continuous and automated activation outcomes.

But figuring out the ‘how’ and ‘what’ of these connections should start by defining your use cases. For example, you might want to split customers into distinct segments to provide seamless cross-channel communications at the segment level; or to identify what product should be upsold next for every customer, and message that ‘next action’ product to each such customer in every channel; or to simply define customers unlikely to buy again, and exclude them from all digital marketing and advertising to cut waste.

Defining exactly what you want to do with your first-party data will guide you in determining which tools and systems you need to connect to your data lake/CDP.

As a side note, we typically recommend Google Cloud Platform (GCP) for data lakes because GCP natively connects to the biggest search engine, the biggest programmatic Demand Side Platform (DV360 from Google), the top ad server (Campaign Manager from Google) and the top web analytics solution (Google Analytics 360). The ability to easily transfer audiences back and forth between these systems and GCP makes it an ideal foundation for a data lake/CDP in most cases.

6. Look at the full customer journey to separate your quick wins from your long-term transformation initiatives.

Many marketing leaders naturally want to begin with a big, ambitious initiative to kickstart their first-party strategy. But starting big is tough — and the chances of success can be fragile. By contrast, taking an entrepreneurial approach and starting with a number of smaller initiatives significantly increases the chances of early success. 

That’s why we’re firm believers in the “crawl > walk > run” approach to marketing transformation. Starting with a small, “quick win” project or proof of concept (POC) is the ideal way to gain traction and build momentum toward bigger projects. Smaller initiatives generate value quickly, that value is often easier to define and measure, and they almost always generate ideas for ‘next in line’ initiatives that built on the prior learnings from POCs. Moreover, these quick wins earn trust and buy-in across the organization — soft assets that are critical to the future success of larger initiatives.

7. Clearly communicate successes in terms of business value in order to gain favor and trust among leadership.

Most marketing leaders aren’t shy about sharing their successes. But the problem is that business leaders often don’t think in terms of — or simply don’t understand — marketing speak. Marketing leaders need to position their POCs and quick wins in the context of broader corporate strategy, and communicate successes in the langage of universal business impacts (i.e., revenue, profitability, operational efficiency, etc.).

‘First principles’ thinking often helps explain to the CEO or the Board the value behind an initiative. For instance, a DELVE customer recently came to us with the goal of increasing online sales by 50% over the next three years with a first-part data initiative. We used a simple (Visit)*(Conversion Rate)*(Average Order Value) framework to explain where exactly in the value chain we expect to see impact from the project. This step-by-step approach allowed our client to present this framework to their CEO and Board as their own, and enabled our customer to focus and control the conversation.

8. Educate the organization on the value of first-party data — beyond traditional Marketing use cases.

Our research shows that the majority of CMOs see their role evolving toward “chief digital officer” or “chief experience officer.” Part of redefining their job descriptions and taking ownership of the entire customer experience is to educate other key stakeholders across the business about the broad and deep use cases of first-party data that extend well beyond the traditional purview of marketing. 

For instance, first-party data projects can shine the light on customers who are likely to call customer care with complaints, or who are more likely to return products. 

CMOs should lean into these broader use cases, communicating the powerful business value hiding within first-party data, in order to elevate their role within their organization.

9. Relentlessly measure ROI and value and ruthlessly optimize marketing activities based on the data.

One of the greatest values of building first-party data strategies is that you have full control over all the inputs and outputs — so you have much greater transparency and visibliity to the ROI and business value delivered by these initiatives. But “value” can’t always been neatly measured through an ROI equation. Value can also represent employee trust in data and willingness to listen to insights; greater speed to generating and activating insights; more meaningful insights that directly tie to general business objectives; or insights and recommendations that are more actionable.

Relentless measuring ROI and value is one thing. But marketing leaders need to be ruthless when it comes to optimizing based on that data. Typically, it’s much easier to take the “cut what doesn’t work” approach than to wring your hands over what works “best.” For instance, one of the fastest and easiest ways to get value from first-party data is to use that data to identify waste in digital marketing — to identify customer segments with negative LTV, or customers that rely on offers and fail to generate profit — and re-allocate that spend elsewhere.

10. Build on your successes to expand and accelerate digital marketing transformation.

If you’ve followed steps 1-9, this last step will follow naturally. Following the crawl > walk > run approach, your quick wins will give you traction and buy-in with key stakeholders in your organization. This will allow you to get the budget and resources needed to think bigger and broader — to revamp your website, build an app or completely change your customer journey by using AI-powered automation to add predictive and assistive experiences. You’ll also begin to find opportunities to utilize first-party data that extend beyond marketing — ways to use your first-party data to solve key challenges and address goals in everything from R&D and product, to sales and operations, to supply chain and accounting.

Ultimately, marketing leaders should remain confident that every first-party data project, no matter how small, is a significant step toward becoming a data-driven leader in your vertical. Embracing the data as currency paradigm and continuing to grow your investments in digital transformation is the key to building momentum today to create long-term “unfair advantage in digital” tomorrow.

Then, look at how first-party data can enable you to go deeper with those goals. For example, you can zoom in on your ‘best’ customers, going beyond looking at the ‘typical’ customer journey — instead seeing the full journey taken by your ‘best’ customers. Or, you can go deeper into achieving RoAS targets in digital marketing by focusing focus marketing investments on customers with the highest LTV. One more example: You can analyze personalization initiatives through the lens of activities that increase your share of wallet within your ‘best’ target customer set.