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3 Reasons Companies Are Stuck With Identity Solutions They Don’t Like

Companies today are making decisions and investing in third-party identity solutions that will ready them for the next evolution of data management and collection. The trouble, however, is that many brands aren’t doing this the way they want. 

Due to external technology and policy changes, oftentimes, marketers simply feel under pressure to decide on a solution quickly, leaving little to no room for experimentation or innovation. 

Many brands, particularly financial services companies, have trouble disentangling from long-standing relationships with major data providers that may be resistant to making the deep investments required to modernize. Too many brands feel stuck with the ID solutions they’ve got and are being forced to evolve at the slow pace of their partners. 

Let’s unpack what identity and data solutions are, identify some of the reasons why brands work with ID solutions they don’t like, and learn how to balance the need to move quickly while also maintaining flexibility and control over long-term customer relationships.

What Is an Identity Solution?

In recent years, many technology platforms like web browsers and operating systems have been imposing restrictions on the use of third-party cookies, data collection, and user tracking. Together with regulations like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act, this has created the need for new solutions to identify customers and connect customer-brand interactions with their identity. 

Identity and access management solutions, or simply ID solutions, are the new technology and strategies that allow companies to identify and store customer data without using third-party cookies and violating data privacy regulations. ID solutions can identify a customer within one environment—for example, a browser—or across different platforms and devices. This information is later used in marketing and advertising.

Important concepts to better understand identity management:

  • Identity matching: This is the process of identifying a customer across multiple platforms and matching this data to create a holistic view of the customer’s behavior. For example, you only know a customer’s email. Using this piece of data, you can identify what social media platforms they use if they log in using this same email.
  • Shared identity or universal ID: This is a standardized procedure to identify a user and share this data with other companies, as well as AdTech and MarTech vendors, as opposed to each business identifying and managing this data.
  • Device graph: The graph aggregates data on customers’ behavior across multiple devices and recognizes it as a behavior of one user. It helps to avoid duplicates and better target users across their devices.  

Enterprises are looking to control how they use identity data amid some major disruptions, but the quest for control has some panicking and moving too hastily. The industry hasn’t settled on a definitive way of using customer data in the future, yet many brands are making decisions that may leave them locked in and unable to make a change. The quest for ID solutions right now may mean a loss of control—and a loss margin—in the near future.

Three Mistakes Businesses Make When Choosing an ID Solution

1. Choosing an ID solution solely by the ease of use and set up

One reason why so many companies choose their data provider (and subsequent ID solution) is because they just want to get it done. The ease with which the task can be completed is paramount. There’s a sense of relief, possibly even joy, when a decision is made, and the brand feels it can tap into the next phase of people-based marketing. 

With some providers, the ease extends to use. Teams feel a rush of excitement when they can expand their audiences with the click of a button. 

Of course, all teams want ease. No one wants a headache when it comes to selecting data management partners, nor do they want to have a hard time using any associated software. But ease alone isn’t enough to make such a huge decision. The data decisions made today will impact businesses 10 and 20 years down the line. The instant gratification of checking a box right now could lead to intractable problems down the road. The goal is to select the easiest solution in the long run, not in the moment.

2. Not thinking long term

The old adage is “nobody ever got fired for buying IBM.” While that phrase may be outdated, the attitude remains when it comes to making big IT decisions. The team in charge of these decisions still often goes with the biggest name. As a result, no one questions the decision.

While this prevents any second-guessing, it’s clearly not a sound business decision. Picking the same ID partner as everyone else sounds safe, but it doesn’t sound strategic at all. The rise of Big Data has taught us that data is critical to all enterprises and marketing operations, but there is no single data strategy that is applicable to every business. There are infinite ways that brands can use their data, as well as so many variables that go into making decisions and building a strategy. You can get in trouble if your decision doesn’t support your strategy, especially over time.

3. Placing all responsibility for data regulations compliance on the ID solution

Another reason why so many brands are making identity choices now is because they think they can check the box and then their platform of choice will change based on their future needs. 

This is a gamble based on two huge assumptions. First, that the identity platform’s concept will win out over other ideas in the market. Again, the industry is still sorting out how data and ID management will look in the future. Yet some of the partners are pushing their solution as the future. No brand should  give in to the pressure and marketing speak.

Second, choosing right now carries the expectation the partner will have the money to invest in future developments. Betting on someone else’s development budget is a dangerous game that could cause long-term problems.

How to Approach Choosing an Identity Partner

On the opposite side from the “just get it done” folks are the “wait and see” brigade. It’s absolutely true that the current data landscape is just the latest stage in a continuous  evolution. More change is inevitable. 

However, this is not a reason to hold off on committing to a data management partner. The goal is to move quickly, but not hastily. There’s too much at stake for any company to drag its feet when it comes to managing identity. Amid new privacy policies and cookie deprecation, brands are losing control of how they manage and use identity. Waiting too long would yield the same result as moving recklessly: someone else would control their identity in the future.

Brands don’t need to check a box; they need something that helps their business now and will not prohibit them from operating in the future. They need a solution that lets them use identity in a way that fits their operations. It’s entirely possible to find a solution and integrate it quickly in a way that doesn’t stop future developments or flexibility.

The industry is undergoing seismic shifts so frequently that going with what feels like the safe bet or easy option right now could have real downsides in the long run. For too many brands, the goal is to hit the easy button. Instead, pursue the larger goal of taking control of identity. The future of your company depends on it.

Mindfully finding the balance between speed and flexibility has been at the heart of Adstra’s business model and its enterprise identity platform,  Conexa. 

Recommended further reading:

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