How legacy brands can extract value from first-party customer data

Every time a customer interacts with a brand, their activity generates first party data. Whether it’s purchase history, loyalty program use, website and mobile app activity, support calls or feedback, first party data can be sourced from multiple places and the smart organizations are using it to drive the quality of future experiences and nurture stronger loyalty.

However, Adam Nowak, the global CRM and loyalty director for Electrolux, says many organizations limit themselves by only sourcing first party data from email marketing. Ahead of his session at All Access: Customer Loyalty and Retention, Adam tells CX Network how a legacy brand like Electrolux is using first-party data to build loyalty.

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CX Network: During All Access: Customer Loyalty and Retention, you’re explaining how a legacy brand can build loyalty using first-party data. Without giving too much away, how can first-party data be used to build direct relationships with customers?

Adam Nowak: Companies often self-limit their use of first-party data to just email marketing. While email is important, truly leveraging first-party data goes far beyond that. Companies should think and act much broader, using the rich customer data they hold to personalize the entire customer experience across all touchpoints – from the website and mobile app to in-store interactions, product recommendations, customer service, and more.

First-party data can unlock opportunities for true one-to-one relationships if utilized strategically across the full customer journey.

CX Network: Looking generally at the CX landscape in your market, how would you rate the use of first party data by B2C organizations?

Adam Nowak: Many well-established B2C companies struggle with effectively using first-party data due to legacy challenges like data silos and outdated technology, or their lack of comprehensive data management strategies.

Companies that started as e-commerce first are often in a better position to leverage first-party data across channels. However, even the leaders in this space have room for improvement as technology rapidly improves and opens up new opportunities for harnessing this data to create truly personalized, omnichannel experiences that build direct customer relationships.

Overcoming ingrained limitations is key for legacy brands to catch up in the first-party data game.

CX Network: Where do the opportunities lie for organizations to accelerate how they use first party data?

Adam Nowak: There are two core opportunities for organizations to accelerate their use of first-party data.

Fist they should develop a clear strategy for monetizing data through improved customer acquisition, retention, and other revenue models. The second opportunity lies in consistent, long-term execution by building the right data infrastructure, skills, and data-driven culture across the organization.

Treating first-party data as a strategic asset requires an unwavering commitment to ethical data practices over an extended period, not just a short-term initiative.

RELATED CONTENT: The ethical AI guide for customer experience

CX Network: Our research into the Global State of CX in 2024 confirmed that although customers still want instant service and convenience, they also want their data to be used responsibly and they’re happy to delegate their customer service interactions to AI-powered personal assistants. When it comes to maintaining and growing loyalty, how can practitioners engage and connect with a customer who is tech savvy and time poor?

Adam Nowak: While adopting advanced technologies can unlock many opportunities, such as self-service options that reduce costs for tech-savvy customers, there is a challenge in catering to diverse customer segments. As some consumer cohorts become increasingly tech-savvy, others may lag in technical adoption and proficiency.

This dichotomy creates a situation where organizations must simultaneously keep up with the more advanced customers by providing cutting-edge, seamless digital experiences, while also ensuring they do not leave behind the less tech-savvy segments.

Companies must strike a balance, leveraging technology to meet the demands of their most technologically adept customers, while still maintaining traditional support channels and user-friendly interfaces for those who prefer or require more guidance.

The key is to segment the customer base accurately, understand the varying technological proficiencies and preferences, and then design an omnichannel experience that flexibly adapts to different levels of digital savviness. This approach ensures no segment feels alienated or underserved, fostering loyalty across the entire customer spectrum.

CX Network: Our Global State research also found customers are increasingly apprehensive about sharing their data, especially when AI is involved. What can organizations do to build trust with customers and reassure them about how their data is used?

Adam Nowak: Transparency, ethical principles, security measures, and regulatory compliance are just hygiene factors when it comes to building real trust with customers about using their data, especially with AI involved.

To truly build trust, organizations need to clearly demonstrate how providing data will tangibly solve problems and create value for the customers themselves.

Customers are more willing to share data when they can see the direct benefits it provides them. One simple example is facial recognition for unlocking phones or making biometric payments. Customers don't mind providing that data because it saves them time and effort. However, they would be apprehensive about their faces being tracked by CCTV cameras on the street with no perceived upside for them.

The key is to communicate specific use cases where the use of customer data and AI capabilities will enhance their experiences, add convenience, provide personalized recommendations, or unlock new and valuable features.

When customers can clearly see ‘what's in it for them’, they are more likely to feel the value exchange is worthwhile and opt-in to data sharing.

Click here to catch up with Adam's session at All Access: Customer Loyalty and Retention

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