In this Digital CxO Leadership Insights video, Mike Vizard talks to Kevin Niparko, vice president of product for Twilio Segment, about how customer engagement is evolving in the digital business era.
Mike Vizard: Hello and welcome to the latest edition of the Digital CxO Leadership Insight series. I’m your host, Mike Vizard. Today we’re with Kevin Niparko, who is the vice president of Twilio Segment, which is a customer data platform, CDP of some type, that he’ll get into, I’m sure. Kevin, welcome to the show.
Kevin Niparko: Michael, thank you so much for having us on.
Mike Vizard: I think at the core of everybody’s frustration, when it comes to digital transformation, is we already have massive amounts of data. It’s all over the place in these organizations. And yet, we still have these disconnected customer experiences and people get frustrated because they may have sent an email but they want a phone call back or they want a video call back, but they don’t want a ton of email. And we don’t ever seem to strike the right balance with all this stuff. So, from your perspective, what ails us?
Kevin Niparko: Yeah, that’s exactly right. And we actually just recently wrapped up our fourth annual state of customer engagement report, which pulls 10,000 different businesses and consumers globally to really check in on this question that you’re asking. And one of the things that we found is that while 46% of brands claim that they are personalizing the end user experience with data, only about 15% of consumers agree with that. And so, you can see the gap and we’re still definitely not at 100% or even close to it, so what’s behind that? At the base level, we really see this as a hard customer data and infrastructure challenge.
Actually making sense of all of these digital signals that are being collected today is a really hard engineering and infrastructure problem. And so, that’s really the role that customer data plays and customer data platforms can help businesses with is help collect, unify and then activate this customer data across all of the places in which data can be used. And really, bringing that personalized experience to the forefront to drive better engagement. And especially in this moment, really hard macroeconomic headwinds that a lot of businesses are facing is absolutely paramount that you get that right.
Mike Vizard: It also seems like, to be honest, there’s a lack of courage. And what passes for digital transformation is somebody took an existing process and slapped a mobile front end on it, and they didn’t actually re-engineer the process. So, do we really need to think through what it means to have a data-driven process and dive deeper into this? Because ultimately, everybody I talk to is like, “It was better the old way.”
Kevin Niparko: Yeah, I think that makes a ton of sense. And I really do think that digital transformation requires both people, process and technology changes, and so really thinking from the end user experience, what is the experience that you are looking to drive? What does great engagement look like for your customers or prospects of your business? And then, working backwards from that, from the technology layer to the people and process and how that all comes together to be able to really deliver on end user expectations.
Mike Vizard: There is also no shortage of CDPs these days. I mean, I personally have been following this space forever, and I’m not even sure what makes one different from the other. So, ultimately, what should people be looking for in a CDP and what makes one different than the other?
Kevin Niparko: Yeah, absolutely. So, the way that I think about this is it starts with data collection, which is being able to collect data from all of the various digital touchpoints that you are having with your end user. And this is a blossoming set of data sources and data silos that need to be tapped into. Then, the next step is about making sense of this data. So, this is really where identity resolution and data governance comes in. Building towards this global singular understanding of users, a user profile, what we call a golden record. And then. The next step is activation or federation. So, being able to tie this into the various channels and applications where this data can be used.
And so, one of the things that we really emphasize, one, is around great data infrastructure, so really thinking about scalability, reliability, observability, and really being able to understand and adapt to the scale at which your business is moving. The second is around openness and extensibility. So, rather than some walled gardens and many of the suites that exist today, Segment and Twilio is taking a much more open approach to this data problem. And we’re bringing the marketing and analytics ecosystem to bear on this problem, and really harnessing a lot of the great momentum that’s happening out in the community to really be powered by the singular understanding of who a user is, where they are in their journey, and how you can better help them.
Mike Vizard: At the other end of the extreme, we seem to be trying to strike a balance between encouraging affinity and not being too creepy. So, how do we have those conversations with end users where they feel like what we’re doing is helpful, but not weirding them out?
Kevin Niparko: Great question. I think there are sort of two threads to this. There is first a commitment to a first party data approach, so making sure that the data that you are using is collected transparently. You have a direct relationship with your customer and are educating them on how their data will be used. The second piece of this is really ensuring that consent and privacy is at the forefront of your data strategy and digital transformation, and this is really where thinking about a holistic and unified platform that can help you collect and manage consent throughout this data pipeline is absolutely vital. And so, ultimately, we think that a lot of the new regulation and platform controls that are going into effect is amazing for end user control of their data. And businesses need to be able to adapt and adapt really quickly to what is a quickly and rapidly-evolving environment.
Mike Vizard: I know digital CXOs are kind of charged with this task, but it’s complicated and there are a lot of parts. Is there any set of best practices that you’ve seen your customers do that you kind of wish everybody else would copy as a playbook? Because it seems like everybody’s struggling to one degree or another. Not equally, but there’s always something.
Kevin Niparko: Yeah, I think the reality is that it is sort of never too late. The best time to start laying this great foundation is right now if you haven’t already been. And so, we’ve been working with customers from really advanced B2B use cases like MongoDB to fitness and health tech companies, like CrossFit, really help tap into all of the great data that may exist across the organization. Use the tools and infrastructure that is available today to collect, unify, and then activate that across the stack. And really taking this first principles approach, thinking about what is most important for your end customer and being ruthless about delivering on that.
Mike Vizard: Of course, we’re all a little AI happy these days, and it seems like anytime we manage to put any kind of volume of data together, somebody wants to throw an algorithm at it. What do you think the impact of all these AI platforms is going to be on the customer relationship? How will it manifest itself and is it still science fiction or is this getting real?
Kevin Niparko: Yeah, I think a lot of businesses have been dreaming about this one-to-one engagement model with their end customers. And AI, and a lot of the breakthroughs that we’re seeing literally on a daily basis are helping pull that vision forward. I think we see this happening at a few different levels. The first is there are definitely more powerful levels, foundational models that are being introduced across OpenAI, Google, Anthropic, all of the big names here. But to actually tailor the output of those models, you need clean data and you need to be able to bring context to those models.
And then finally, you need to be able to activate the output of those models across all of the places in which you’re interacting with your customers. And so, we really see this as both a data problem of tailoring and fine-tuning these large language models and generative AI capabilities. And then, also an activation problem on top of that, being able to harness the output of these models and really deliver on that end user engagement that you’re looking to drive.
Mike Vizard: Do you think at the end of the day that customers are going to start voting with their feet based on the digital experience? Because it seems like, at least from my perspective, it’s never been easier to switch from one vendor to another for whatever service I happen to be once it becomes digital. So, is the way we compete fundamentally changed?
Kevin Niparko: Absolutely. I think consumers are very much being trained by some of the digital giants that a personalized and relevant experience needs to happen fast and it needs to happen now, and that’s what they’re looking for. Our state of customer engagement report found that 66% of consumers will quit a brand if that experience is not personalized. And so, this is really an imminent threat to a lot of businesses, is getting their data in order and getting their engagement in order to be able to deliver on those heightened expectations.
Mike Vizard: All right. So, what’s that one thing you see customers doing that just makes you shake your head and go, “Folks, we’re better than this”?
Kevin Niparko: I think it really comes down to just generic, irrelevant experiences. I think that’s probably most of the experiences that we have out there on the web today. And when you turn to some of these digital giants, you really see what is possible with great customer data, with a great infrastructure behind it, but it often takes hundreds or thousands of engineers to build that. And so, really, where CDP and customer data platforms fit in is making that a lot easier and more available to businesses to be able to keep pace with the digital giants.
Mike Vizard: All right, folks. You heard it here. Think it through, do it right, because you might not get a second, third, fourth or fifth time to try it again. Hey, Kevin, thanks for being on the show.
Kevin Niparko: Thanks for having me, Michael.
Mike Vizard: All right, and thank you all for watching the latest edition of the Digital CxO Leadership Insights series. You can find this on the digitalcxo.com website, along with other episodes. We thank you all for spending some time with us and we’ll see you all next time.