Unlock AI Transformation with Smart Customer Data
▼ Summary
– Australian brands face intense pressure to compete and meet rising consumer expectations for personalized experiences, but most AI applications remain small-scale or experimental.
– Data fragmentation is a major obstacle, with many brands struggling to unify customer data and build complete profiles, which is essential for effective AI deployment.
– Brands must build strong data foundations using customer data platforms (CDPs) to create unified customer profiles, enabling better insights and AI-driven personalization.
– Identity resolution is a critical but underinvested area that helps eliminate duplicate profiles, improve AI accuracy, and enable consistent cross-channel customer engagement.
– Early adopters who address data fragmentation see significant benefits, such as improved marketing ROI and better customer recognition, positioning them to win with AI-driven growth.
For Australian companies, the race to stay competitive while meeting heightened consumer demands has never been more intense. Today’s customers anticipate personalised interactions and tailored offers as a basic standard, pushing brands to explore advanced solutions like artificial intelligence. While interest in AI is widespread, actual implementation often remains limited or experimental. Recent studies indicate that a mere 11% of U.S. retailers feel prepared to deploy AI across their entire operation, and in Australia, adoption rates are similarly modest, only 8% of local brands have embedded AI into their core processes for optimisation and recommendations.
A number of hurdles stand in the way of broader AI adoption. Limited technical know-how and high implementation costs pose real challenges, but one of the most persistent issues is fragmented customer data. In Australia, 82% of retail leaders admit they are only beginning to activate data effectively for customer experience and personalisation. Another 84% say they are still emerging in their efforts to build a single, unified view of each customer. Without clean, accurate, and consolidated data, even the most sophisticated AI tools risk delivering irrelevant or counterproductive customer experiences.
Establishing a strong data foundation is not just helpful, it’s essential. Brands that want to succeed with AI must first bring together information from all consumer touchpoints. This means investing in systems that aggregate data in real time and generate complete 360-degree customer profiles. Customer data platforms (CDPs) are particularly valuable here, making enterprise-scale data usable for AI applications. Organisations using a CDP report being twice as confident in interpreting customer behaviour and three times more likely to deploy AI in customer-facing roles.
A major challenge in unifying data is identity resolution, the process of accurately linking all interactions to a single individual. Duplicate profiles are common when shoppers use different emails, abbreviated names, or multiple contact details across channels. Though over half of Australian marketing and eCommerce leaders say unifying customer data is a top priority, only 14% feel they are making tangible progress. Even fewer, just 25%, are investing specifically in identity resolution, despite its foundational role.
When brands do address identity resolution, the results can be transformative. Consider the example of UK fashion retailer New Look. After analysing their records, they found nearly a third of their best customers were using more than one email address, fragmenting 3.4 million profiles across duplicate records. By implementing an identity resolution solution, New Look merged these separate entries and, within a single quarter, boosted return on ad spend by 50%, saving over £1 million by targeting the right shoppers. They also discovered that 71% of their top customers shop across multiple channels, allowing the brand to engage up to 24% more high-value shoppers with smarter, coordinated marketing.
Despite these clear benefits, identity resolution remains a low priority for many retailers. Only one in five are currently using AI to tackle this issue. As the industry shifts from small pilots to large-scale AI deployment, accurate and unified customer data must move to the forefront. Retail is at an inflection point, moving beyond experimentation to execution, and this transition depends on having enterprise-level data management and CDPs in place.
Australian brands that prioritise solving their data challenges will be best positioned to harness AI effectively. A clean, organised, and consolidated data foundation enables faster decision-making, sharper insights, and more meaningful customer connections. For those ready to invest in the right infrastructure, the potential for growth and improved customer relationships is substantial.
(Source: ITWire Australia)
