Data Collaboration Fuels Revenue Growth
Organizations Need The Right Technology To Connect Data Across Partners And Sources In A Privacy-Preserving Way
A Forrester Consulting Thought Leadership Study, March 2024
Sharing data and analytics is essential for innovation and creating an insights-driven culture. Leading organizations will share data with ecosystem partners to deliver the best customer experiences and drive growth.1 To do so, organizations must break down data silos to enable data sharing and ensure privacy and security.
In February 2024, LiveRamp commissioned Forrester Consulting to evaluate how companies are using technology to combine and analyze data in order to enable a wide range of internal and external use cases — which we defined in this study as data collaboration. Forrester conducted an online survey with 510 US leaders who know how their organizations gather and use data to inform decisions. They represent organizations in the consumer packaged goods (CPG), retail, travel and hospitality, and financial services industries. We found that these leaders saw data collaboration as critical to driving revenue growth, but they said they need the right partners and technology to overcome data privacy and quality hurdles and enable them to scale their data collaboration capabilities.
Key Findings
- Data collaboration boosts revenue growth. Ninety-three percent of respondents agree that improved data collaboration is critical to driving increased revenue. They expect data collaboration maturity will fuel revenue growth via improvements in customer loyalty, customer experience, data quality, data privacy and regulation compliance, and more.
- Data silos and privacy concerns prevent organizations from maturing their data collaboration capabilities. Few organizations can leverage data collaboration today because there is no way for them to unify data across sources while maintaining quality and privacy.
- Organizations need partners to support the widest range of data collaboration use cases with cutting-edge privacy practices. As privacy regulations are enforced and evolve, organizations seek partners with advanced privacy expertise and data connectivity solutions to enable their many data collaboration use cases.
Consulting Team:
Mandy Polacek, Senior Market Impact Consultant
Lillie Sinprasong, Associate Market Impact Consultant
Contributing Research:
Forrester’s Technology Executives and Technology Architecture & Delivery research groups
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Data is a crucial asset to any enterprise, and it needs to be readily available to internal teams, partners, and customers. Data can reveal powerful insights to inform decisions that drive growth. In surveying 510 respondents, we found that:
- Organizations have varying access to first-party data and collaborate with partners to enrich that data. First-party data helps organizations better understand customer preferences, behaviors, and needs. Respondents in this study say their organizations have access to first-party data today, but how much and what types varies by industry. Those at CPG firms say they have the least amount of access to first-party data; their peers in other industries like financial services say they have access to a lot of first-party data, but regulations limit the types of data they can collect and what they can do with it (see Figure 1). Many organizations turn to external partners to enrich their customer understanding: 59% of respondents say they collaborate with external partners who have more first-party data than they do, and 43% say they collaborate with external partners for access to different types of first-party data (see Figure 2).
Figure 1
How much first-party data does your organization have access to today?
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Note: Percentages may not total due to rounding.
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
Figure 2
How Organizations Engage In Data Sharing With External Partners
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
- Improved data collaboration is critical to revenue growth. Ninety-three percent of respondents agree that improved data collaboration is critical to driving increased revenue at their organizations. For this study, we defined data collaboration as using technology to combine and analyze data sets within an organization or with partners to enable a wide range of use cases. With that definition in mind, nine in 10 respondents said data collaboration is important or critical to achieving their top goals. They expect expanding their data collaboration capabilities will drive revenue growth via improvements in customer loyalty, customer experience, data quality, data privacy and regulation compliance, product innovation, and more (see Figure 3).
POLL
How would you expect data collaboration to drive revenue at your organization?
Select all that apply
POLL
How would you expect data collaboration to drive revenue at your organization?
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Note: Showing top responses selected
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
The possibilities are endless for organizations that successfully unite data across sources and make insights easily available across complex organizations and with ecosystem partners. We asked respondents which internal and external use cases would be valuable to their organizations (see Figure 4). We found that:
- All industries are focused on laying the groundwork for effective data management and governance. Data collaboration is only possible if organizations have the processes, procedures, technologies, and architecture in place to maintain data quality, integrity, privacy, and security as more parties leverage data to support more use cases. Respondents say their organizations are focused on doing just that, although the actual use cases vary by industry. Forty-nine percent of financial services respondents say their organization needs to create well-defined identity rules customized to its needs and applied consistently across every interaction; 47% of retail respondents say their organization needs to identify the most up-to-date customer information; 50% of travel and hospitality respondents are focused on unifying fragmented data across the customer journey; and 43% of CPG respondents cite the need to minimize redundancies in customer data at the individual and household levels.
Figure 4
The Top Internal Data Collaboration Use Cases
Click to see data by industry
[CONTENT]
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
- Cloud interoperability is a particularly high priority for financial services and retail. Cloud interoperability is important to all industries that focus on improving external collaboration, but financial services and retail find it most challenging: 55% of financial services respondents and 46% of retail respondents say they need to improve their organization’s ability to leverage the cloud across business lines — a top data collaboration use case. Interoperability is likely challenging for financial services due to greater regulatory requirements and legacy systems. Retailers are likely challenged by a complex vendor ecosystem, with vendors using different cloud platforms.
- Increasing value for advertisers is a top retail use case. Retail respondents see data collaboration as a win-win: 53% would like to provide advertisers with more transparency into performance data, such as exposure logs or walled-garden insights. And 52% see the value of using data collaboration to build high-value media networks that leverage data and unique owned and operated properties (see Figure 5).
Figure 5
The Top External Data Collaboration Use Cases
Click to see data by industry
[CONTENT]
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
- Leveraging external data to improve customer understanding is particularly important in CPG and financial services. CPG organizations tend to have access to less first-party data than other industries, in part because they often sell through retailers and online marketplaces. The financial services industry is especially sensitive to privacy and trust concerns, and it faces stricter regulation on how it collects and uses first-party data. External data is therefore important to both industries in enriching their customer understanding: 58% of financial services respondents and 51% of CPG respondents say their organizations want to establish or grow partnerships with larger companies to expand access to the data their organization has about customers and prospects. And 54% of financial services respondents and 52% of CPG respondents want to enrich their first-party data with third-party attributes, such as demographic data and behavioral insights, to increase customer and prospect understanding.
- All roads lead to improved personalization. Nine in 10 organizations do some level of personalization today. Delivering personalized, privacy-forward experiences to customers across channels is a top five external data collaboration use case for respondents in all the industries we surveyed. Personalization requires organizations to better connect data across the business and customer journey while using external data to enrich customer understanding.
While organizations see tremendous value in improving their ability to combine and analyze data sets, they struggle to overcome privacy limitations and connect this data today. We found that:
- Few organizations can make their data collaboration dreams a reality on their own. We see a significant gap between the value that organizations desire and their ability to enable these use cases with their current resources. For example, delivering personalized, privacy-forward experiences across channels is a top use case for 54% of respondents, but only 12% say they can do this with existing resources. Achieving privacy-forward, personalized experiences requires the most up-to-date customer information; this is a top use case for 48% of respondents, but only 18% say they can do this today (see Figures 6 and 7).
Figure 6
The Gap Between The Desire And The Ability To Enable Internal Data Collaboration Use Cases
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
Figure 7
The Gap Between The Desire And The Ability To Enable External Data Collaboration Use Cases
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
- Connecting data while protecting privacy is a top challenge. Many organizations lack the right partners and technology to accurately connect data sources across partners while ensuring privacy protections. This is a top concern for respondents in retail and travel and hospitality. And 44% of travel and hospitality respondents also say that data privacy regulations limit their organization's data collaboration capabilities.
- Breaking down data silos is another top blocker. Financial services and CPG respondents are most interested in leveraging data from external sources to enrich customer understanding. They report that their organizations struggle to unify consumer data across multiple sources in order to leverage it for new use cases across various parts of their organizations. Financial services and retail respondents also report that their first-party data is siloed across business units (see Figure 8). Organizations must break down data silos to enable data collaboration.
POLL
What data sharing challenges does your organization face?
Select all that apply
POLL
What data sharing challenges does your organization face?
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
Figure 8
The Top Data Sharing Challenges
Click to see data by industry
[CONTENT]
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
Ninety-three percent of respondents agree that the right partner/technology is critical to improving their data collaboration capabilities. To overcome their top data collaboration challenges:
- Respondents seek partners with advanced privacy technology and expertise. Ninety-three percent agree that data collaboration will be most successful if their organization can maintain privacy protections and/or regulatory compliance without diminishing the value of the data. When asked about the top partner requirements, 81% say robust capabilities to connect data without relying on deprecated signals like third-party cookies; 77% point to dedicated experts in data ethics and consumer privacy; and 77% want advanced privacy-enhancing technologies and the ability to stay at the forefront of global privacy regulation (see Figure 9).
Figure 9
Data Collaboration Partner/Technology Requirements
Click to see data by industry
[CONTENT]
Base: 510 US leaders with knowledge of how their organization uses first-party data within their department, across the business, and between partners
Source: A commissioned study conducted by Forrester Consulting on behalf of LiveRamp, February 2024
- Partners must be able to support a wide range of use cases. Data collaboration presents an immense opportunity to drive enterprise innovation and value. To close the gap between what they want to achieve versus what they’re able to do today, 81% of respondents say it is important or critical to seek partners that can support the widest range of internal and external data collaboration use cases.
As businesses strive to leverage data-driven insights and personalize customer experiences, the importance of data collaboration can’t be overstated, particularly in the face of internal hurdles like data silos across business units and external disruptions, such as the deprecation of traditional data signals like third-party cookies. Through data collaboration, companies can not only unlock a wide range of internal and external use cases — from improving customer loyalty and data quality to driving product innovation and new revenue opportunities — but also remove or bypass persistent roadblocks, including siloed data and obsolete data connectivity methods.
Forrester’s in-depth survey of 510 US data and insights leaders in CPG, retail, travel and hospitality, and financial services yielded several important recommendations:
Appendix A: Methodology
In this study, Forrester conducted an online survey of 510 US leaders who know how their organizations gather and use data to inform decisions within their own departments, across the organization, and with external partners. Survey participants represent organizations in the consumer packaged goods (CPG), retail, travel and hospitality, and financial services industries. Respondents were offered a small incentive as a thank-you for time spent on the survey. The survey was conducted in a double-blind fashion. The study began and was completed in February 2024.
Appendix B: Demographics/Data
Region
| United States | 100% |
Annual Revenue
| $500M to $999M | 25% |
| $1B to $2.9B | 47% |
| $3B to $4.9B | 20% |
| $5B or more | 9% |
Industry
| CPG | 25% |
| Retail | 25% |
| Travel and hospitality | 25% |
| Financial services and/or insurance | 25% |
Respondent Level
| Vice President | 25% |
| Director | 56% |
| Manager | 19% |
Department
| Customer experience | 26% |
| IT | 22% |
| Marketing/advertising | 21% |
| Operations | 20% |
| Data and analytics | 10% |
Note: Percentages may not total 100 due to rounding.
Appendix C: Supplemental Material
Related Forrester Research
Invisible Experience Competency: Data Sharing Ecosystem, Forrester Research, Inc., December 27, 2023
Data Governance Is The Foundation Of Insights-Driven Business, Forrester Research, Inc., February 4, 2024
Trusted Data Sharing: A Modern Framework For Empowering Individuals And Organizations, Forrester Research, Inc., September 6, 2022
The Future Of Data Management, Forrester Research, Inc., February 8, 2022
Appendix D: Endnotes
1 Source: “Invisible Experience Competency: Data Sharing Ecosystem,” Forrester Research, Inc., December 27, 2023
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