The age of mobile applications, pervasive use of social media and growing demand for accurate consumer data are converging to drive significant changes in how organizations connect with and market to their respective customer bases - as well as the technologies they use to do so. It's becoming increasingly clear that legacy technologies that weren't purpose-built for consumer-facing use cases will no longer suffice.

Take, for instance, identity and access management (IAM) systems. Historically used to manage a business's internal employee records, many brands leverage modified IAM systems to manage their customer identity records as well. These brands are finding, however, that there are significant differences between managing corporate data resources and managing exabytes of consumer-generated data, and these differences simply can't be addressed effectively with IAM systems.

IAM ≠ CIAM
Indeed, IAM systems have inherent deficiencies that prevent their efficacy in consumer-focused projects; namely:

• Inability to scale. The largest on-premises IAM systems were built to manage, at the most, a few hundred thousand employee identities. Customer identities across mobile and web channels can easily number in the hundreds of millions.
• Privacy challenges. Traditional IAM systems' privacy settings are controlled by the organization. Consumers expect control over their own personal data as well as complete transparency with regard to how their data will be used.
• Difficulty supporting omnichannel interactions. Omnichannel capabilities have never been of paramount importance when dealing with employee-centric IAM systems. Consumers today rely on a variety of devices to connect with organizations and brands.

For these reasons, many organizations are finding that their use of IAM systems for consumer-focused identity management projects is contributing to poor customer experiences.

Interestingly, even Forester Research agrees, and, recognizing the unique requirements of the management of customer identity data, the independent market research and advisory firm recently acknowledged an entirely new market, customer identity and access management (CIAM). CIAM systems allow businesses to understand their customers on a deeper level by facilitating the registration and identity verification processes across devices, consolidating data into rich customer profiles and integrating those profiles with additional marketing and service technologies. These capabilities yield a better understanding of an organization's users and make privacy a priority, leading to known, loyal and engaged customers rather than anonymous shoppers. Operationally, CIAM solutions emerge superior to IAM systems as well, using the cloud to ensure that scalability is a non-issue and performance is not compromised.

CIAM: Purpose-Built for Customer Identity's Unique Requirements
Well-designed CIAM systems are optimized to provide key capabilities quickly and simply, such as user self-service, registration, preference management and social authentication. They have several additional characteristics in common that make them optimal for customer identity management projects, especially when compared with IAM systems.

Scalability and Usability Across Channels
As mentioned earlier, cloud-based CIAM systems offer on-demand scalability to support millions of dynamic users across mobile and web channels. The ability to scale in this manner also means consistently high performance and a seamless user experience across devices.

Privacy and Security
Because privacy is of paramount importance to consumers today, CIAM systems offer comprehensive privacy and preference management capabilities. With CIAM systems, customers can choose which marketing communications they want to receive and decide what personal data they will share with a business. CIAM technologies also allow for multifactor authentication support to protect high-risk transactions, as digital identity continues to merge with payments.

Holistic View of the Customer
Organizations today are not just looking to increase their operational agility and comply with security and privacy mandates. They are also striving to build customer relationships that result in higher retention and revenue. CIAM systems can drive these initiatives by utilizing permission-based customer data to power more personalized marketing interactions. CIAM solutions capture rich, first-party customer data through customized registration flows, and authentication through social networks. They deliver consolidated reports and analytics around user demographics, behavioral data, revenue activity and more to gain a more holistic view of an organization's customers.

As we dive deeper into the age of the customer, and digital user experience continues to become a source of competitive differentiation, it's more important than ever for businesses to take advantage of customer identity data in their marketing, sales and service efforts. Unfortunately, IAM systems - while absolutely adequate for managing employee identities - are hardly equipped to leverage customer information. By deploying a purpose-built CIAM platform, organizations can harness the power of customer identity data and secure a competitive edge.