The cloud has made customer data management easier than ever. It has also created some unique complications that brands need to be prepared for. Brands need to weigh their options carefully before choosing a cloud management solution.
Storing Customer Data on the Cloud – the Good the Bad and the Ugly
In 2009, Yale University Professor Daniel J. Abadi wrote a white paper titled Data Management in the Cloud: Limitations and Opportunities, which covered the benefits and limitations of cloud technology. While the industry has evolved over the past few years, most of his findings are still true. Here are some of the benefits and drawbacks highlighted by Abadi and other researchers.
Cloud Resources Are Scalable
Scalability is one of the biggest benefits of the cloud. Jason McKay, Vice President of Engineering at Logicworks, states that one of the wonderful things about the cloud is that it can range from 0% to 100% scalability.
Brands in cyclical industries can leverage it to meet their customer data needs during peak periods. This is particularly important for companies in the retail sector, because they need to store more customer data during the holiday season when sales increase.
Growing businesses can also benefit from scalability. Cloud storage space is cheap, so they can easily expand their hosting plan as their customer base broadens.
New Jurisdictional Complications
Cloud servers can be stored in any country in the world. This can create complications for both multinational companies and firms using global cloud hosting providers. In 2014, Microsoft was forced to respond to a subpoena for customer data in Ireland, because the U.S. Supreme Court ruled that extra-territorial restrictions don’t apply to cloud storage.
If your company works with customers across the world, you need to familiarize yourself with their country’s privacy policies and other regulations. Some countries have strict laws about how data must be stored.
For example, the United States Health Insurance Portability and Accountability Act (HIPAA) has strict policies on protecting customer privacy. If you store data on a cloud server in another country, then you may violate HIPAA laws if foreign officials subpoena or release any of your data.
Improve Targeting of Digital Marketing Campaigns
A reliable cloud server is necessary to store big data on customers. This data enables your company to have a clearer understanding of your customers, which can be invaluable for targeting customers with Facebook and other digital marketing platforms. There are a number of applications that allow you to collect data from customers and store it on your cloud server.
Security Risks
The cloud is many things, but it is not highly secure. Even data that is stored on a private cloud server is vulnerable to hackers. This can put you in a very uncomfortable position if any customer information is released, especially if you are in a highly regulated industry such as consumer finance or healthcare.
Understand the Cloud Landscape
Cloud technology is leading to rapid changes in virtually every industry across the globe. However, there are still some limitations that brands need to be aware of.