What Does a Customer Data Platform Do?
What’s a Customer Data Platform?
A customer data platform (CDP) is martech software that creates a unified view of your customer data from your various systems in a single place. This unification makes data accessible throughout the entire organization. However, to be a true CDP, this software must do four things:
- Ingest customer data from multiple sources
- Unify customer profiles into a single view via identity resolution
- Create “real-time” customer segments
- Integrate customer data to other systems, out-of-the-box
Let’s take a closer look at those four functions.
Understanding What a Customer Data Platform Does
Data Ingestion
One of a customer data platform’s critical capabilities is gathering, standardizing, and validating data from across all online and offline sources. Most CDPs need to format the data specifically for ingestion data. Simon Data, however, can ingest data as-is and does the reformatting on its end. Next, the profile is ready for unification.
Profile Unification
A CDP brings together ingested data, deduplicates, and consolidates it into a single customer profile. This unified profile becomes your sole source of truth when it comes to understanding your customer. Everyone in your organization can now use the same to execute campaigns and create segments.
Segment Creation
As we stated above, consolidated customer profiles allow marketers to build custom segments from within a CDP. These segments increase personalization and tailored communications. Giving marketers the ability to create and tweak customer segments allows for more accuracy in speed in marketing campaigns.
Integration
With a CDP, marketers can immediately and seamlessly integrate segments into their end channels, like ESPs or advertising platforms. Additionally, this integration results in a truly personalized experience that avoids redundancies and extra work.
Combining these capabilities into a single, accessible platform for marketers shortens the path from idea to execution and measurement. Or, as we like to say, what a CDP does is help get the right data into the hands of the right people to make informed decisions, quickly.
How Does a CDP Help Marketers Make the Most of Their Customer Data
CDPs make connecting the dots between customer events and overall behavior easier to better strategize and deliver experiences at customer expectations.
CDPs Help Marketers Understand Their Customers
Consumers are acutely aware of the amount of information you have about them. They expect you to use it to enhance their customer experience. They expect marketers to go past personalization and tailor experiences uniquely for them. This level of personalization is the exact type of experience a CDP enables. In other words, a CDP should help you understand your customers on a personal level but at scale.
Rather than use the customer data you have to tell you about how a customer is currently behaving, a CDP can use this information to predict future wants and create extraordinary customer experiences. Genuinely connecting with your customer is about anticipating their wants and needs and delivering on them.
Customer Data Platforms Make Segmenting Data Easy
CDPs achieve an aggregated view of all customer data across all sources. CDPs have an intuitive interface for targeting and personalizing this aggregated data. These abilities allow marketers to orchestrate customer experiences across channels and provide rich insights into customer behavior and campaign performance.
CDPs Provide Access to More Insightful Customer Analytics
When your siloed data doesn’t communicate, and you can’t get a full view of the customer, you will inevitably waste spend targeting campaigns to the wrong people. On the other end of the cost-saving spectrum, what a seamless customer data platform does is make measuring campaig, channel, or medium-specific ROI easier. Having centralized customer data offers critical insights into opportunity sizing and experimentation.
Who Needs a Customer Data Platform?
How Other Companies use CDPs
Companies use CDPs to serve several of their campaign needs. The primary outcomes you can expect from finding the right CDP for you are:
- Unified Customer View: Bring all disparate data together from various sources and organize it into a single customer view
- Segmentation: Break down your audience into groups that go beyond demographics, geographics, and firmographics by tapping into customer behavior to create richer segments
- Dynamic personalization: Get much more granular personalization with a CDP unifying your data and integrating with BI and analytics tools; you can automate around endless parameters
- Orchestration: Orchestrating from one place, where the unified customer view is updated in real-time, gives the right information at the right time to the right person.
- Cross-Channel Experimentation: having all your data in one place means iterating on existing segments or flows is quick and easy
How to Choose a CDP
Like everything else, the customer data platform is not one-size-fits-all. The CDP space is vast and there are several types of CDP that focus on different business outcomes. The first thing to do when choosing a CDP is to make sure the functionality meets your business needs. Do an internal meeting with the decision-makers to be sure everyone is on the same page. Then, start the RFP process to find out which CDP is the best fit for your business. These steps are an essential part of assessing the problems a CDP will solve for you.
Regardless of which type of CDP you buy, make sure it can ingest, unify, and integrate your data, enabling you to create audience segments.
Easily Start with Simon
Simon Data is an orchestration CDP. An orchestration CDP focuses on advanced segmentation and campaign orchestration across multiple channels. Simon Data has an intuitive interface that allows non-technical users to create segments easily based on their data. This design helps marketers tailor and strengthen customer experiences independently of other teams.
Download the guide to learn more about what a customer data platform is, and why you need one.
