Identity Resolution: The key to unlocking modern marketing and beyond

For true identity resolution to occur, a technology solution must not only be able to match and distribute data in real time, freely and directly to any endpoint but also persist and evolve this data throughout the lifetime of the customer relationship.

“Never forget what you are, for surely the world will not. Make it your strength. Then it can never be your weakness. Armour yourself in it, and it will never be used to hurt you.” At the risk of contradicting the father of Game of Thrones George R.R. Martin, the world (the business world that is) tends to forget who people are, which is definitely a weakness, worse, it will often be used against them!

The complex process of linking people’s online and offline behaviour to their unique identity by gathering different data sets and identifying non-obvious relationships gave rise to an exponential number of identity resolution & management software solutions in the past few years. Major applications include: (i) risk management: manage risk, detect fraud, and ensure compliance with regulations against money laundering and other economic and trade sanctions; (ii) operational optimisation: enhance the effectiveness of regulatory compliance, law enforcement, and security operations; (iii) maximisation of technology investments: reduce implementation costs of third-party applications and development costs of customised applications; and (iv) customer experience enhancement: identify customers with a single, more comprehensive and accurate view.

This last application having the most measurable and clear impact on ROI in the short term (by reducing customer turnover and improving customer contact methods) was the first to take off. As a result, the imposing cluster of logos representing the marketing technology landscape has recently grown a little denser. Nestled under the data management platform (DMP) category, and to the right of the customer data platform (CDP) grouping, lies a new class of martech: identity.

With the influence of Amazon, GDPR now in full motion, and the mounting scrutiny of Facebook’s data privacy practices, it is increasingly clear that competing in today’s data-driven marketplace requires direct customer relationships. Which makes identity more than a nice-to-have, it’s an absolute imperative, but also one of the most difficult problems to solve.

Identity, in its most basic sense, is the connection point between all customer engagements, online and offline, past and present. For true identity resolution to occur, a technology solution must not only be able to match and distribute data in real time, freely and directly to any endpoint but also persist and evolve this data throughout the lifetime of the customer relationship.

The big walled gardens — Facebook, Google and Amazon — can approach each user as a single identity, since users of these platforms are usually logged on but this has left many brands and data providers outside the gardens managing a variety of approaches to come up with unified identities for customers and prospects.

The problem, according to Richard Foster, UK Managing Director at identity resolution provider LiveRamp, has been that “marketers must either target audiences in the same walled gardens where their preferences are shared, or use cookie data for web interaction without much context beyond their customers’ browsing history.”

As a result, technologies that help solve this conundrum are in-demand. Acquisitions and fundraising in the space have dramatically increased in 2019. The ability to hyperpersonalise interactions with customers has attracted a wide variety of buyers and investors including some that are unexpected such as McDonald’s, Nike, or commercial data vendor Dun & Bradstreet. Private equity is also gaining appetite for this sector as shown by the acquisition of Attunity by Thoma Bravo-backed Qlik or the acquisition of Acquia by Vista. The same goes for the VC community with a record level of investments in CDPs and customer experience platforms (CXP) in H1 2019. CDP company Segment raised $175 million in a Series D round in April, making it the largest raise in the space and one of the largest in martech altogether in the past two years.

Looking at deals in the space, there is a long list of ways to apply identity resolution to marketing, but the most important applications and techniques are:

1. Marketing lists: Multiple messages to the same person on email or direct mail lists are costly to deliver and can be annoying to receive. Identity resolution can remove duplicates whether they result from the same person appearing on multiple lists or from duplication within a single list. Cleansing and removing duplicates is therefore a critical capability when selecting an identity resolution technology.
2. Cross-device targeting: This works with a device list rather than personal identifiers. The devices may be linked to known individuals or not. It supports direct contacts, such as text or in-app messages, as well as mobile advertising through external networks. Techniques used include probabilistic match for a cross-device and deterministic match for device-to-person.
3. Ad targeting and retargeting: This starts with creating a marketing list but then uses identity resolution to connect with external identifiers, such as cookies in a Data Management Platform or ad network or audiences in a social media platform.
4. Website personalisation: Identity resolution can connect a web visitor to their unified profile and use this data to select optimal treatments based on their complete history.
5. Customer service: Identity resolution allows phone or chat agents to know who is calling and find their records. This saves time and makes the customer feel recognised.
6. Omni-channel programs: Cross-channel identity resolution makes it possible to truly coordinate customer treatments, starting with identifying customers wherever they appear and continuing with selecting treatments based on a complete profile and having continuous conversations across channels over time (including online and offline).

While all companies — and their solution providers — have different needs, approaches and levels of accuracy, several initiatives may soon supplant the need for these kinds of identity resolution by brands or their solution providers. There are three initiatives underway to populate the web and other channels with a single ID. The Interactive Advertising Tech Lab’s DigiTrust and The Trade Desk’s efforts are currently focused on the web, while the Advertising ID Consortium — closely connected to LiveRamp’s multi-channel IdentityLink — seeks to create an ID across other platforms as well as the web.

Being able to engage customers at the individual level (vs. at the audience level) and personalise interactions is a common goal across sectors. As a matter of fact, the more a customer within a given vertical generates data across disparate data sources the more likely that vertical is going to seek solutions to aggregate those data sources to better engage with customers.

This is also true for the healthcare, pharmaceutical and life sciences industries which are relentless producers of data. To put it into perspective, the human body contains nearly 150 trillion gigabytes of information. That’s the equivalent of 75 billion fully loaded 16GB Apple iPads, which would fill Wembley Stadium to the brim 41 times. Imagine collecting that kind of data for an entire population. The vast amount of data generated and collected by a multitude of stakeholders in healthcare comes in many different forms — insurance claims, physician notes, medical records, medical images, pharmaceutical R&D, conversations about health in social media, and information from wearables and other monitoring devices. The power to access and analyse enormous data sets can improve our ability to anticipate and treat illnesses. This data can help recognise individuals who are at risk of developing serious health problems.

The ability to use big data to identify waste in the healthcare system could also lower the cost of healthcare across the board.

The number of M&A transactions in healthcare customer analytics has been growing at a steady pace as a result, with one deal every quarter on average since January 2016.

Although healthcare is a prime candidate for identity resolution due to the amount of data generated by its stakeholders, the need to establish a link between data and individuals can be applied to virtually any sector but also within key support functions in organisations. Some of the most widespread applications are in IT and cybersecurity. CG Results International recently advised identity and access management (IAM) services provider Intragen on its investment from FPE Capital. IAM in enterprise IT defines and manages the roles and access privileges of individual network users and the circumstances in which users are granted (or denied) those privileges. Those users might be customers (customer identity management) or employees (employee identity management). Technologically, the emphasis of the majority of IAM services is on preventing external threat actors. As a rule, hackers look for the easiest means of entry ports into IT environment. Login portals provide these ports; only by constantly verifying the legitimacy of users can sensitive assets be protected from external threat actors.

Sensitive corporate information is increasingly at risk outside of the traditional enterprise firewall due to the current hybrid environment of physical, mobile and cloud. Data is ubiquitous and users demand constant access to it wherever they are. IT teams are struggling to protect this information and need to know the users accessing the data are really who they say they are. In the past, IT teams had a high visibility on who was accessing sensitive information and where they were moving it on the network. But it’s a different environment today with users accessing data through cloud and mobile applications—and often on their own personal mobile devices and unsanctioned cloud applications. Behaviour monitoring capabilities also help ensure identity security by verifying whether the users act like themselves while connected.

Insider threats represent an even more nefarious danger to databases and digital assets. Malicious insiders already possess legitimate credentials into companies’ networks. Thus, their login attempts and activities normally don’t arouse the suspicion of IAM solutions. As a result, malicious insiders can more easily conceal their activities within their everyday business processes. Privileged access management (PAM) and identity governance and administration (IGA) form the backbone of internal identity security. Identity governance works to enable automated and monitored role management throughout the entire enterprise. Indeed, it can help define the permissions of specific roles, ensuring each only possesses the absolutely necessary access it needs. Furthermore, IT security can use IGA to review specific identities and ensure they only have the bare minimum of necessary access; if they detect an issue, they can remove permissions at will.

Identity governance therefore has implications for human capital management. ID governance is starting to automate the onboarding process, which ensures accounts do not linger after the employee leaves the enterprise. Privileged access management not only protects users from external actors; it also helps regulate which privileged identities can access an IT environment. For example, the heads of HR should not possess access to banking resources; conversely, CFOs shouldn’t have access to sensitive employee files. Ultimately, identity governance needs to ensure access rights are controlled in such a way as to balance the need for security and compliance, while ensuring employees are able to be as productive as possible.

Although identity resolution applications are driven by the marketing industry’s desire to avoid the inaccurate and costly effort of massive cookie-matching that currently takes place, the ability of companies to leverage data to know and engage with their customers/employees/stakeholders at a hyper-personalised level is only just beginning and will increasingly impact many aspects of corporate practices and everyday life.

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