Transitioning To A 1st-Party Data Plan

Summary

MarTech Podcast ™ // Marketing + Technology = Business Growth
Episode: Transitioning To A 1st-Party Data Plan
Release Date: December 9, 2024
Host: Juan Mendoza
Guest: Chris Sell, Co-Founder and Chief Product Officer at Growth Loop

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Introduction to the Episode

In this special episode of the MarTech Podcast™, guest host Juan Mendoza, author of the Martech Weekly Newsletter, engages with Chris Sell, Co-Founder and Chief Product Officer at Growth Loop. The episode delves into the critical transition from third-party to first-party data strategies in the wake of evolving digital privacy standards and the deprecation of third-party cookies.

The Impact of Third-Party Cookie Deprecation

Juan opens the discussion by highlighting the industry's turbulence following Google's announcement to phase out third-party cookies. Initially slated for a full deprecation, Google pivoted to offering users the choice to opt out of third-party cookies, leading to confusion and uncertainty within the marketing and advertising sectors. This shift has accelerated the urgency for businesses to adopt first-party data strategies.

Chris Sell emphasizes the seismic shift in the industry:

"The industry has completely tipped over... I think AI has helped because people are realizing AI is pretty worthless if you don't have your data assets in order."
[04:56]

Defining a First-Party Data Strategy

Chris elaborates on what constitutes a robust first-party data strategy, underscoring the necessity for businesses to proactively control their data assets. He critiques the traditional approach of aiming for a comprehensive Customer 360 view, which often leads to costly and impractical implementations without clear business use cases.

"A real first-party data strategy... it's a perfect example... Start with the data that matters the most in the business."
[07:27]

Instead, Chris advocates for a more pragmatic approach:

1. Data Discovery: Identify all customer interactions across various touchpoints such as websites, applications, and point-of-sale systems.
2. Prioritization: Focus on the most valuable data assets that can drive immediate business outcomes.
3. Incremental Implementation: Develop and activate data layers progressively, allowing for flexibility and alignment with marketing needs.

"It's not saying don't understand your full data catalog. Definitely do that and do that research exercise, but layer it, expose it to marketing, see if it's useful for their use cases and then proceed."
[10:58]

The Concept of Customer 360

The conversation shifts to the feasibility and practicality of achieving a single view of the customer. Chris likens the traditional Customer 360 approach to building a high-performance vehicle that may not meet immediate needs, advocating instead for incremental data integration.

"First party data strategy is the same to me... you need to start with a skateboard. It's like, hey, ticketing data or my purchase data is the most important."
[08:57]

Building a Business Case for First-Party Data Strategy

Juan and Chris discuss the challenges of securing executive buy-in for first-party data initiatives. Chris advises aligning data strategies with specific business problems to demonstrate tangible value, such as reducing customer churn or increasing repeat purchase rates.

"Does the company have a churn problem?... How does the first party data strategy drive that?"
[11:38]

He provides a strategic approach:

1. Identify Key Business Metrics: Understand the metrics that executives prioritize, such as revenue growth or customer retention.
2. Link Data Strategy to Metrics: Clearly articulate how the first-party data strategy will positively impact these metrics.
3. Demonstrate Quick Wins: Start with small, impactful projects that can showcase immediate benefits and justify further investment.

"If you align your first party data strategy to the metrics to drive those metrics, that is how you get promoted."
[15:00]

Driving Transformation: The Role of Leaders

Effective transformation requires a blend of technical expertise, strategic vision, and political savvy. Chris highlights the importance of leaders who can navigate these multifaceted roles to drive successful first-party data initiatives.

"It's all three... You have to play the politician, sometimes you have to play the data engineer and sometimes you have to play the marketing hat with the strategy."
[17:16]

He emphasizes starting with manageable projects and using platforms like Growth Loop to activate data efficiently, thereby building trust and demonstrating value to executives.

"They just build the layers and they report up each time. That's the folks that win and get promoted that I've seen."
[17:13]

Conclusion and Key Takeaways

The episode underscores the imperative for businesses to shift towards first-party data strategies in an increasingly privacy-conscious digital landscape. Key takeaways include:

• Proactive Data Management: Control your data assets to ensure long-term sustainability and leverage AI effectively.
• Strategic Alignment: Align data initiatives with core business metrics to secure executive support and drive meaningful outcomes.
• Incremental Implementation: Adopt a phased approach to data integration, prioritizing high-impact areas to demonstrate value and gain momentum.
• Leadership Skills: Successfully navigating this transition requires a combination of technical knowledge, strategic planning, and political maneuvering.

Chris Sell concludes with a compelling vision for marketers and data leaders to champion data-driven transformations that directly impact business performance, ensuring their initiatives are both valuable and recognized within their organizations.

Notable Quotes:

• Chris Sell on Industry Shift:

  "The industry has completely tipped over... I think AI has helped because people are realizing AI is pretty worthless if you don't have your data assets in order."
  [04:56]

• Chris Sell on Data Strategy Pragmatism:

  "First party data strategy is the same to me is... start with a skateboard. It's like, hey, ticketing data or my purchase data is the most important."
  [08:57]

• Chris Sell on Securing Executive Buy-In:

  "If you align your first party data strategy to the metrics to drive those metrics, that is how you get promoted."
  [15:00]

• Chris Sell on Leadership Roles:

  "It's all three... You have to play the politician, sometimes you have to play the data engineer and sometimes you have to play the marketing hat with the strategy."
  [17:16]

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For more insights and episode summaries, visit martakpod.com. Connect with Chris Sell on Growth Loop's website or his LinkedIn profile linked in the show notes.

Transcript

[Benjamin Shapiro]

The Martech Podcast is a proud member of the iHear Everything Podcast Network. Looking to launch or scale your podcast, iHear everything delivers podcast production, growth and monetization solutions that transform your words into profit. Ready to give your brand a voice? Then visit iheareverything.com.

From advertising to software.

[Chris Sell]

As a service to data, across all of our programs and clients, we've seen.

[Juan Mendoza]

A 55 to 65% open rate.

[Chris Sell]

Getting brands authentically integrated into content performs better than TV advertising.

[Benjamin Shapiro]

Typical life span of an article is about 24 to 36 hours. If we're reaching out to the right.

[Chris Sell]

Person with the right message and a.

[Benjamin Shapiro]

Clear call to action, then it's just.

[Chris Sell]

A matter of timing.

[Benjamin Shapiro]

Welcome to the Martech Podcast, a member of the I Hear Everything Podcast Network. In this podcast you'll hear the stories of world class marketers that use technology to drive business results and achieve career success. Here's the host of the Martech Podcast, Benjamin Shapiro.

Welcome to the Martech Podcast. I'm Benjamin Shapiro, the executive producer of the Martech Podcast and today we've got a special episode for you which is going to be guest hosted by Juan Mendoza, the author of the Martech Weekly Newsletter. Juan is a recovering Martech consultant turned creator who writes an amazing weekly newsletter about the Martech industry and I'm thrilled to invite him and some of his friends to take the mic and share their knowledge with you, our loyal Martech Podcast listeners. All right, here's a special episode of the Martech Podcast guest hosted by Juan Mendoza, the author of the Martech Weekly Newsletter.

[Juan Mendoza]

Well hello. Hello Martekers, My name is Juan Mendoza. I am your guest host on the Martech Podcast and also I'm from the Martech Weekly. Joining me today is Chris Sell who is the co founder and Chief Product Officer at Growth Loop. Growth Loop is an awesome company which is empowering marketers to build dynamic audience segments, orchestrate cross channel journeys and really evaluate campaign performance through its advanced data cloud. Growth Loop seamlessly integrates with the leading data warehouses and are really sort of driving a lot of thought leadership around what does sort of composable marketing technology architecture look like? Yesterday Chris Sell and I talked about bridging the gap between your marketing and data teams. So today we're going on a different track and talking about this whole world of third party cookie deprecation, how businesses are responding with building and transitioning to a first party data plan and what does that look like from a technical operations and also from a business case perspective as well. It's a Fantastic conversation. And here it is. So here's our conversation with Chris Sell, the co founder and chief Product Officer at Growth Loop.

[Benjamin Shapiro]

But before we get to today's interview, I want to tell you about what I'm listening to. Ever wanted to sit down to a candid conversation with marketing leaders from the world's biggest brands? The Current podcast is your chance. On the Current podcast you'll find exclusive interviews with the experts and trendsetters who are on the front lines of digital advertising. And they always leave the ad tech jargon at the door. So subscribe to the [e-mail] or anywhere you get your podcasts today.

[Juan Mendoza]

Chris, thanks for coming back for day two.

[Chris Sell]

Yeah, thanks so much, Juan. I appreciate you having me again.

[Juan Mendoza]

And it's been a fun conversation so far. A lot of analogies. We talk about baseball, we're talking about holidays, we talk about a bunch of crazy stuff. But this conversation, obviously it's very relevant right now in the industry. We just had Google announce that they're sunsetting their own sunset, so to speak, which is they were planning to remove third party cookies, putting the industry into a panic. At the start of the year, they deprecated 1% of Chrome browsers from using third party cookies and marketers, advertisers started freaking out. So crap, this is actually happening. The cookie apocalypse is happening. But then they said, no, actually we're not going to deprecate cookies for everyone. We're going to give that choice to the user. We're going to create a feature where the user can opt out of third party cookies overall across all websites and they're going to sort of work on that plan instead. And so it's been a very chaotic four or five years of like, what's happening next? A lot of customer data platforms saying, hey, brands should start shifting from third party trackers to first party trackers and that type of data to drive advertising. But this sort of plethora of solutions out there to manage identity in a sort of third party cookie list world. So that kind of brings us to our conversation now, just as backdrop and what you're doing at Growth Loop, which is coming from it, perhaps not just, hey, just use first party data for all your advertising, it's actually creating a strategy. And what does that strategy and plan look like? And so perhaps my first question for you, Chris, is more around how would you define a first party data strategy? Like, what does that look like sort of in practice?

[Chris Sell]

The key thing about thinking through a first party data strategy is One, I think the industry has completely tipped over. Like Google is now, like you mentioned, sunsetting the sunset at a certain point where they are now saying hey, they will allow for third party cookies. But what folks have realized that I speak to is they're like, look, I need an insurance policy at the very least, meaning I should be controlling my own destiny, not waiting for news about whether third party cookies are going away or not. So over the last four to five years a lot of brands and companies have already started to shift towards hey, I need to take control of my data assets and understand what they are and then understand what to do with them. So many brands are already down that path. But even the ones I expected after this, the cookie pocalypse going away, that folks would be like, oh, maybe we're good with third party cookies. I'm not seeing that though. People are still saying hey, I need to have a first party data strategy. And I think in a large part actually I think AI has helped because people are realizing AI is pretty worthless if you don't have your data assets in order. So it'd be behoove you to get them in order so that you can use AI. I think it's happening now. In terms of what does the strategy look like overall? I think it gets back to what you and I were talking about yesterday is I think what typically people do is they form an 18 month roadmap and try to get to what they call a customer360. So they do a data discovery. They decide, hey, what are all the different interactions we have with our customers? Whether it's in the website, the application and our point of sale or through third party vendors and then they try to design a data schema around those, they then start to interview identity providers out there to say, hey, if we were to bring together this perfect picture of our customer and merge all the IDs into a single identifier and have all of these interactions with them dovetailing off of that, what would that look like? They do these big specs, they do the RFPs, it's going to cost $5 million. They say, hold on a second, what was the use case? Why are we doing all this? What is the data asset useful for? What a real first party data strategy. To me, yes, you do need to understand what data assets you have in the interactions with your customers. But that's just table stakes. Then the real work begins of which pieces of that are the most crucial for the value adds that you're actually going to activate and use in your business. So it's a perfect example. I know we were talking about sports and using ticketing data that matters the most in the business. Start there. So I think taking that extra lens to Your big behemoth Customer360 is the starting point of having a first party data strategy.

[Juan Mendoza]

Customer360 and single view of customer, they're sort of related concepts, right?

[Chris Sell]

Yes.

[Juan Mendoza]

A few years ago, gosh, this was a while back, back in 2020, we covered a bit of work from Gartner. They came out and said that the single view of customer, the 360 thing, it's like a waste of time. And we were kind of querying that ourselves because it almost seems unattainable, particularly for large enterprise businesses, to have a single view. But I get the value proposition, which is you can get all of the different variables that relate to a customer, how long they've been with you, all of the different before they hit your own channels or their website, all the ad tech integrations, you know, having all of that data in one spot, it gives you a visibility over what you can create with use cases. Years ago I used to work with a customer data platform and I really struggled with it because we had that 360 sort of view we had actually quite as an E commerce business. And a lot of the work that we were doing was just collecting enriching profiles, single profile, stitching profiles across website sessions and then of course looking at, okay, what's all the transactional data, what's all the other things? Returns, customer service. And then we actually had a really cool profile. But the problem I had, Chris, was that when I went to query that data to analyze it, which is super valuable, right? Like what are the opportunities, what's the insight where we can build new use cases, what are we missing in terms of the journeys? I couldn't query it and I won't name the cdp, but definitely was a point of frustration where I think a lot of this is visibility. When you say customer360, is that what is it? Visibility into all the actions, all the events that relate to a single customer.

[Chris Sell]

I'll use because we love our metaphors here, I want to use one more. So one of my other mentors, Braden Moore, he works at the 76ers in New Jersey Devils, what he says in a first party data strategy is I don't want you to build me a ferrari that goes 200 miles an hour because I don't want to wait for you to build it. What I want is a skateboard then I want a scooter, then I want a bike, then I want the car. Because he wants something that improves his transportation speed at every single checkpoint. First party data strategy is the same to me is in your example of the CDP putting together that full 360, but then you can't query it. The thing you need to do is you need to start with a skateboard. It's like, hey, ticketing data or my purchase data is the most important. What does it take to land that in the to Google cloud and Snowflake? Let's just land it, get an ETL tool, ingest it. It takes minimal modeling. How do we then expose that to marketers? Well, the way you do that is you start to get a BI tool or you get a composable CDP like growth loop to say, hey marketers, why don't you come in and self serve and try to use this purchase data for building audiences for your Facebook campaigns? Because then marketers are going to come in and say, well actually I really like to use the survey response data when I'm building audiences. Do you guys have that? And we say, well, we've done this huge exercise of putting together all of our potential data assets, but we're doing it based on demand and layering in the customers360 where every time we layer an additional layer on the cake, it's fully visible to marketers. And I think what people do typically is they hide the cake from marketers and bake the whole thing and then they do a big surprise birthday and say, do you like it? And they're like, no, I like sprinkles. I think that's the key to the first party data strategies. Again, you and I were talking about it yesterday. Bring the marketing team along on each layer. Is this valuable? Is this value? It's not saying don't understand your full data catalog. Definitely do that and do that research exercise, but layer it, expose it to marketing, see if it's useful for their use cases and then proceed.

[Juan Mendoza]

I think it's interesting that when it comes to creating a first party data plan, a strategy, the strategy is in service of some kind of ask to the business because yes, you want to be able to orchestrate the data and use it, but at the end of the day you have to go to some executive, you have to go to the cmo, the head of digital or the, you know, even the CEO in some businesses and go, hey, here's our first party data strategy. We need X millions of dollars to actually do this. And this is how we map it. What's your experience in that? Because clearly a lot of these strategic intent projects are about business cases and actually getting the investment. What do you see as some of the blockers there when it comes to asking for investment to actually build out a first party data strategy?

[Chris Sell]

If you're going to take this to your CMO or CEO, anybody I feel like that's embarked on a CDP project knows this is you'll run an RFP and then you get to the final decision desk and what they want to know, the executives want to know, is what is the big problem in the earnings report that I care about that this solves for? And if you don't have that on lock, then yeah, it doesn't really make sense to bite off a line item to do all this work. The way I've approached it with our partners and customers is we go after the meatiest problem for the business. Does the company have a churn problem? Maybe they're an E commerce player and they have way too high of churn. Maybe the E commerce players first to second purchase rate is dismal and all their Google Ads are driving to the website and they have 80% of them drop off after first purchase. Well, that's a major problem. Now how does the first party data strategy drive that? Well, the question I would ask is what can I discover about those users when they're anonymous up through first purchase to inform me about how I retain them before they get to second purchase to try to drive that metric up. Then I go to the CEO and say, hey, you know what I'm solving? We're going to do all this cool data stuff, but the reason we're doing it is we're going to raise second purchase rate. And he's like, yeah, I will literally put all the firepower I can on solving that problem. That's great. You're doing data stuff to do it. It's almost like the data stuff is not the end all, be all. It is a means to the business value and that's it. Yeah.

[Juan Mendoza]

Are you familiar with the concept polishing a turd? I hate to be crude to our audience, but it's actually a good analogy for kind of what we're talking about here is that often when it comes to things that you need to fix in a business, say churn is up or where conversion is not there or lifetime spend is not there, sometimes if you don't get the diagnosis right, you end up publishing a turd. And what I mean by that is that you do all this great stuff. Say for example, you create an amazing first party data strategy, you get it unlocked, you're building all these amazing use cases, you've harmonized your data and then the needle doesn't move at all. Often the product is just bad. There are things that are totally outside of the realm of data and analytics that can actually influence business performance. I had an example of this where I worked with a publisher years ago and they were trying to sell subscription to news and the deal was bad. Like they're asking customers to pay way too much and the product wasn't great. Delivery and experience wasn't great. But we ended up doing a bunch of AB testing, personalization and we ended up coming back to them and saying, hey, we'd love to help you, but we're kind of just publishing a turd here. I think that's to your point is that it's very good point for marketing leaders to think through is what does the executive report on if it is a public company, what are the metrics that go into their regular reports to their investors? What are those metrics? What are they tracking? All right, how do you align to those metrics? And then logically explain, okay, you want to change this metric which will lead to revenue. Okay, what are the leading and the lagging measures that influence that? Sometimes it's as small as an open rate in an email that will influence the overall revenue or the overall target. Sometimes it's something much bigger which is, yeah, we don't have customer profiles in our system. We don't have a view of our customer, which is a much bigger problem. Once you fix that, then that leads to that overall metric. But in my view there's this path where you have to kind of trace out what is all the leading measures that are influencing that key metric that will obviously get you promoted at the end of the day. Because that's what we're here to do, isn't it?

[Chris Sell]

That is our job. And if your first party data strategy lines up to the metrics to drive those metrics, that is how you get promoted. Right. The way you just leave the company is you create a first party data strategy that doesn't move those metrics and then three years in you're like, you know what, I think I'm going to seek employment elsewhere. That's the other path.

[Juan Mendoza]

Yeah. Or you get stuck in the loop of inertia where nothing really changes. You still get paid a salary. It's like self driving cars. It's always two years away, right? Oh yeah. We're working on that. It's in the next roadmaps, the next quarter and the next quarter never comes. A large enterprise company, a lot of people are stuck in that, just a loop of not doing much at all. And so like in my view, have you ever met some of those champions that's come in, they build that strategy, execute on it, see those outcomes that they really want to get for the business. What does it take to be that kind of person to drive that significant transformation and change your business?

[Chris Sell]

They're playing that marketing ops role you've been speaking to. Even if they're a leader, they're like a cio. They're taking on that Persona as the bridge. And when they do that and they can actually get it down from a not a self driving car project where it's two years away, two years away, it's actually the customer 72 where you have a thin slice of data you can bring in on a real timeline that hits a use case that the C level cares about and drives a metric. And then they put an activation platform like growth loop in the middle and they activate it. What they do is they're actually really good at getting the first thread out of I call the threads of value and then they take it to the C level and they say, look, they actually ask for incremental investment. They don't ask for the full thing. So this is why composability is helped too. Because it's cheaper to get started than a full package CDP rollout is. You can say, hey, let's just ETL the ticketing data or the purchase data into the data cloud. Let's set up an activation platform, let's get our first emails going, let's measure the results. I am now going to bring a real threat of value to the CEO or CMO and say, hey, we were able to move this metric. We did it in three months. Here's what we did. I think there's further opportunity and requests coming from marketing. Here's the next layers I want to build out. I need X amount of dollars to do so. So they just build the layers and they report up each time. That's the folks that win and get promoted that I've seen.

[Juan Mendoza]

It's an equal part technical, strategic and political.

[Chris Sell]

It's all three.

[Juan Mendoza]

Yeah, it's literally all three. You have to play the politician, sometimes you have to play the data engineer and sometimes you have to play the marketing hat with the strategy.

[Chris Sell]

That's right.

[Juan Mendoza]

Well on that note, that wraps up our final episode. With Chris Sell. He's the co Founder and Chief Product Officer at Growth Loop. Thank you so much for joining me, Chris. If you'd like to join again, touch with Chris, you can find a link to his LinkedIn profile in our show Notes, or you can visit his company [e-mail] But Chris, thank you so much for joining us.

[Chris Sell]

Thanks so much for having me, Juan. Appreciate it.

[Benjamin Shapiro]

Okay, that wraps up this episode of the MarTech podcast. Thanks to our guest host, Juan Mendoza, the author of the MarTech weekly newsletter. If you'd like to get in touch with Juan, you could find a link to his LinkedIn profile in our show notes or you can contact him on Twitter. His handle is Juan Mendoza, but it's spelled Crazy pants. It's J U4N M E N D0Z4 or it's a little easier to just visit his company's website, which is themartekweekly.com A special thanks to the Current Podcast for sponsoring today's Interview. If you're looking for candid conversations with marketing leaders from the world's biggest brands, then give the Current Podcast a listen. On the Current podcast you'll find exclusive interviews with experts and trendsetters who are on the front lines of digital advertising, and they always leave the ad tech jargon at the door. So subscribe to The Current at www.thecurrent or anywhere you get your podcasts today. Just one more link in our Show Notes I'd like to tell you about. If you didn't have a chance to take notes while you were listening to this podcast, head over to martakpod.com where we have summaries of all of our episodes and contact information for our guests. You can also subscribe to our weekly newsletters, and you can even send us your topic suggestions or your marketing questions, which we'll answer live on our show. Of course, you can always reach out on social media. Our handle is martechpod M A R T E C H P o D on LinkedIn, Twitter, Instagram and Facebook, or you can contact me directly. My handle is benjshap B E N J S H A P and if you haven't subscribed yet and you want a daily stream of marketing and technology knowledge in your podcast feed. We're going to publish an episode every day this year, so hit the subscribe button in your podcast app and we'll be back in your feed tomorrow morning. All right, that's it for today, but until next time, my advice is to just focus on keeping your customers happy sh.

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