The Death of Identity Knowing your Customer in the Age of Data Privacy

The Death of Identity Knowing your Customer in the Age of Data Privacy

“Know your customer” is one of the most basic business strategies. Companies have learned a lot about their clients in the digital era by developing personalized profiles based on third-party cookies, social material, demographics purchased, and more. 

However, in the face of rising privacy concerns, organizations have the option to restructure their consumer data relationships to focus primarily on first-party data and patterns of behavior. To track customers and correlate their activities across contact points, businesses have used digital analytics, advertising, and marketing technologies. This allowed for the establishment of data profiles, which have been used to create tailored experiences that are relevant and contextually relevant.

However, this method of profiling and identifying clients is now being questioned more and more. A new data and consumer privacy law are being adopted by regulators, the most recent example being the Colorado Privacy Act. Furthermore, Apple’s privacy features in iOS 14.8 and iOS 15 have been accepted by 96 percent of customers, who have chosen to prevent applications from tracking their activities for ad targeting. 

Furthermore, Google has declared that it would no longer support third-party cookies and will stop monitoring individuals using its Chrome browser entirely. While these advances have the potential to disrupt current digital marketing practices, they also herald a necessary and effective shift in how organizations will understand their customers in the future. 

Individual profiles are not the fast or most successful way to identify and resolve customer intentions, desires and challenges. They do not care about the brand; they care about what they are doing and why they are doing it. Behavioral analysis may use to group users who perform similar behaviors so that they can be targeted more intelligently, as well as to uncover trends that could lead to new income possibilities.

For example, during the COVID-19 quarantine, a prominent home improvement shop used data from FullStory’s DXI platform to see a rise in garage mat sales. Customers were also buying additional materials and equipment that were consistent with establishing home gyms, according to a deeper review of behavioral patterns. To capitalize on the trend, the firm adjusted its merchandising and marketing tactics based on this information.