What is Data Onboarding?

What is Data Onboarding?

Data onboarding is the process of integrating offline or external data into a digital format and matching it to online identifiers for use in paid advertising, marketing, or other purposes.

This data can include customer information, transaction records, CRM data, and more. A few examples of offline data include customers making an in-store purchase where they sign up for a loyalty program with their email address, a customer submitting a survey, or information a salesperson enters into Salesforce manually.

By collecting and uploading customer data and matching it to digital identifiers, you can create a 360-degree view of your customer and then use that customer information in your tools, like advertising platforms, to improve operational efficiency.

Why is Data Onboarding Important?

By bridging the gap between offline and online data, businesses can better identify customer behavior holistically to improve advertising targeting and optimize customer experiences.

Without onboarding offline data, you’re limited to acting on a subset of your data. For example, suppose you want to retarget a list of customers who purchased an item in the last 30 days with a Facebook ad. In that case, you’d only be able to send to customers who purchased through your e-commerce store and consequently miss out on any customers who purchased from one of your physical locations. Data onboarding helps you activate any and all of your data whenever and wherever you need it.

The five main benefits of building a solid data onboarding process include:

1. Efficient Marketing: Your marketers can use onboarded data for targeted advertising, suppression, conversion tracking, email campaigns, and customer segmentation, resulting in more effective marketing campaigns.
2. Increased Marketing Reach:Data onboarding products typically also help increase the “match rate” of users uploaded to advertising platforms, allowing you to serve ads to and suppress ads from a higher percentage of your customers.
3. Data Consolidation: With data onboarding, you can centralize data from various sources into a single repository, reducing data silos, enhancing data quality, and creating a 360-degree view of their customers
4. Enhanced Customer Insights: Consolidating your data into one centralized repository enables you to holistically understand your customers across every channel so you can build more personalized experiences and marketing campaigns.
5. Improved Decision-Making: Because data onboarding is all about linking your offline customer data to your online customer data, implementing this process means you can better understand overall customer behavior to optimize marketing resources and spend toward campaigns that actually work.

How Data Onboarding Works: A 4-Step Process

There are many ways to get offline data to online tools. Whether you take a manual approach, an automated approach, or purchase a third-party solution, there are four steps to onboard your data effectively:

1. Data Collection: Gather data from various sources, such as CRM systems, offline databases, or third-party vendors, into a central platform (usually a database or data warehouse).
2. Identity Resolution: Tie together all of the data points and identifiers from different sources and resolve them to a single user profile to achieve a 360-degree view of each customer.
3. Data Transformation: Convert your data into a consistent format and structure for easy integration.
4. Activation: Sync the transformed data from your centralized database to all of your marketing tools and advertising platforms.

The data onboarding process

Collecting offline data, preparing and consolidating it, and syncing it effectively to all of your tools is the basic process for all data onboarding use cases.

Best Practices and Considerations for Data Onboarding

While the process of data onboarding itself is relatively straightforward, there are several important factors you need to consider.

1. Data Security: Any time you move customer data, keeping that data secure needs to be a top priority. While onboarding data, you want to limit risk–and one of the main risks is buying a tool that stores your customer data externally. Keeping your data in your internal systems provides more control because you have complete control over how it’s managed.
2. Data Observability: Since data onboarding can involve complex integrations and data transformations, you want to make sure you have full visibility into each step of the process so you can catch errors. Transparency in your data pipelines is key so you can measure the quality of the data moving to your online systems, monitor match rates, and adjust settings in real time.
3. Data Governance: Establishing strong data governance policies to maintain data quality and compliances will help avoid potential downstream issues, so it’s important to set up granular controls to manage how users can interact with your data and the syncs to your downstream systems.
4. Automation: Many companies make the mistake of storing and uploading manual CSV files. Utilizing automation tools and scripts can streamline your data onboarding processes to eliminate redundancy and ensure consistency.
5. Flexibility: Another important factor in data onboarding is the ability to easily define, update, and configure your underlying logic. For example, if you’re a financial or healthcare company, you must explicitly define and monitor your match rates to avoid incorrectly assigning sensitive data to the wrong customer profiles.

Data Onboarding Use Cases

While data onboarding is used for many purposes, the most common use cases are typically linked to paid advertising. Given that companies spend billions of dollars on digital advertising every year, this makes sense because even the tiniest change in percentage can have huge implications for both customer acquisition costs (CAC) and return on ad spend (ROAS).

Some of the most common advertising use cases for data onboarding include:

1. Audience Retargeting: Onboarding data from offline sources allows you to retarget users in paid advertising platforms–like Google and Facebook. Retargeting advertising campaigns are some of the most profitable campaigns because customers already have an affinity for the brand. Increasing the number of users you can retarget allows you to expand the impact of these highly profitable campaigns.
2. Audience Suppression: Targeting users who are not likely or eligible to purchase from your company is one of the simplest ways to improve your paid advertising performance. The easiest way to do this is to upload suppression lists directly to your advertising platforms so you can optimize your match rates and, subsequently, your audience targeting.
3. Conversion Tracking (CAPI): Each advertising platform has an algorithm that automatically optimizes both ad spend and targeting. However, for these algorithms to work, you need to send conversion events back to the platform to feed these algorithms. Uploading rich first-party data attached to your conversion events via conversion APIs enables you to provide better signals to ad platforms like Facebook and Google so they can optimize marketing spend towards campaigns that actually work.
4. Personalization: Having more complete data on your customers enables you to create more granular audiences so you can build more personalized campaigns to serve more relevant and contextual ads to achieve higher performance.
5. Global Compliance: Managing compliance is oftentimes a headache for marketing data engineering teams. By centralizing offline and online data, you can also standardize your global customer opt-out list to ensure you are in compliance with all privacy and regulatory requirements across marketing channels.

Tools and Software for Data Onboarding

When it comes to data onboarding, there are really only two data onboarding platforms available on the market today: Liveramp and Hightouch.

Liveramp

Liveramp is a legacy software and onboarding provider that has the largest market share in the space. The company helps you onboard your offline data and build audiences across your advertising platforms. However, many data and marketing teams have a negative perception of the platform because it is outrageously expensive. According to a Liveramp earnings report, 95% of their customers have contracts over $1M per year. The platform is also designed as a black-box solution, which means you’re unable to configure or view their identity resolution logic. If you want to actually implement this tool, you’ll find that it’s a long and grueling process that often involves manual processes like uploading CSVs to a cloud bucket or network drive. The platform also stores your customer data, which introduces redundancy as well as additional security risks.

LiveRamp’s traditional data onboarding process is manual and time-consuming. Data doesn’t reach ad platforms for days.

Hightouch

Hightouch is a modern alternative to Liveramp that offers a data onboarding product called Match Booster that helps solve complex data onboarding use cases directly from your existing data infrastructure. Hightouch takes the same fundamental approach of taking your first-party offline and online user identifiers, enriching them with third-party data, and automatically syncing these audiences to your ad platforms to increase match rates and retargeting options. However, rather than acting as a black box, Hightouch simply connects to your existing data architecture, and that means you have full control over to configure your identity resolution algorithm because it lives in your data warehouse–and that means you own the identity graph.

Hightouch’s Match Booster is easy to use. You can keep ad platforms up-to-date without delaying for days, and Hightouch doesn’t store your data

Closing Thoughts

Data onboarding is a crucial step in data management and analysis. By centralizing, cleaning, and integrating data from various sources, organizations can unlock valuable insights, make informed decisions, and stay competitive in today's data-driven world.

Ready to take your data management to the next level with data onboarding? Chat with a data onboarding expert at Hightouch to learn how you can automate this process.