Gartner's new guidance on Customer 360: Abandon hope all ye who enter here

3 years ago 354

Commentary: Gartner used to urge enterprises to embrace a 360-degree view of their customers. Now it's arguing the opposite.

What a difference four years makes. In 2017, Gartner proclaimed the need for enterprises to "Create Powerful Customer Experiences With a 360-Degree View of Your Products," while acknowledging that fewer than 10% of companies had reached that nirvana. But in 2021, Gartner is reversing course: "Act now: Abandon the pursuit of a 360 degree customer view."

What changed? Not reality, that's for sure. The reason few companies achieved "Customer 360" in 2017 is the same reason most fail today, according to Gartner analyst Benjamin Bloom: "near-impossible technical challenges, accelerating regulatory scrutiny, and data collection practices that ignore what customers want."

Not that vendors won't still try to sell you on the dream.

SEE: Electronic Data Disposal Policy (TechRepublic Premium)

Selling 360º of hype

Don't believe me? Try Googling "360-degree view of the customer," then sit back and watch the sales pitches fly in. I feel a bit dirty because I was complicit in one of those vendor pitches while working for my last employer. Sigh.

Interestingly, there is this Gartner article from 2020: "The False Promise of a 360-Degree Customer View."

[T]he returns on achieving a 360-degree view of the customer are highly questionable….Rather than chasing a 360-degree view of the customer, marketers should seek to collect the right set of data points and stop there.

That article, in turn, links to an earlier, 2019 article from Gartner: "What Marketers Need to Know About Customer Data."

Rather than collecting every possible data point, focus on collecting data that's most useful.

Of course, it's hard to know exactly what that "right" or "most useful" data is, which is why there's a booming business in data lakes, data warehouses, etc. We keep collecting more and more data in the hope that some of it will be useful. And sometimes we're right.

But however "right" that data might be, it's too often the wrong solution to attempt a 360-degree view of the customer, according to Gartner.

SEE: Snowflake data warehouse platform: A cheat sheet (free PDF) (TechRepublic)

The problems with Customer 360

No matter how resource-rich the organization, funds are always finite. As such, Gartner argues, it's best for marketing organizations to allocate resources to near-term, high-value activities, rather than stockpiling data in the hopes of eventually reaching the mythical "360":

Discussions with Gartner clients consistently reveal the tremendous technical and financial commitments required to assemble a "Customer 360", and today's environment adds new complexities: the furious pace of change among your customers, in your business, and the regulatory environment. On top of substantial financial costs, organizations contemplating the 360-degree view must grapple with this sizable investment and its tremendous hurdles: near-impossible technical challenges, accelerating regulatory scrutiny, and data collection practices that ignore what customers want.

It's not that Customer 360 is impossible to pull off, but rather that it's something of a Pyrrhic victory. The costs outweigh the benefits. As such, Gartner has now issued a new forecast, one that unwinds its 2017 guidance: "By 2026, 80% of organizations pursuing a '360-degree view of the customer' will abandon these efforts because they flout data privacy regulations, rely on obsolete data collection methods, and erode customer trust."

It's 2021. You needn't wait until 2026 to move on from the 360 dream.

Disclosure: I work for AWS, but the views expressed herein are completely mine, and don't represent the views of my employer.