The Ultimate Guide to Customer Data Platforms
What is a Customer Data Platform?
A Customer Data Platform (CDP) makes the right customer data available where you need it, so you can activate your customers at the right moment. Think of it as your customer nervous system – it brings together four key capabilities: data collection, profile unification, segmentation, and campaign orchestration.
What Should a Customer Data Platform Do?
Today’s marketing world is all about relationships between companies and consumers. The more meaningful the connection, the easier it is to grow and sustain a loyal base of enthusiastic people. However, this leaves marketers who are faced with a difficult dilemma: How can they build trusted relationships at the scale needed to remain either in a growth phase or at the scale that they need to be in order to remain competitive?
The answer is in your data. From the initial lead interaction to the storing and using of the data, all the way through a quality customer relationship, data makes the difference. But how can companies sustainably collect and leverage good customer data?
The short answer is by using technology. However, if you’re going to tackle this problem with technology, the tools you use must help you. This is exactly what a customer data platform (CDP) should do. Why don’t the other martech solutions fill this need?
The problems with legacy tools
In a nutshell, legacy tools only ever filled in a part of the great customer data puzzle. Most, if not all, legacy marketing technologies were purpose-built with a set amount of functions in mind. Not all of these have aged well and none of them provided a cohesive solution.
This led to many organizations and companies cobbling together a system of multiple moving parts. No single vendor has solved every facet of the customer experience and many company combinations simply can’t fill the gap.
Enter customer data platforms.
How customer data platforms fill the gap
Each step in a quality customer data platform’s workflow guides the user toward driving value with a full view of the customer, critical insights around an opportunity sizing, and profoundly embedded support for experimentation.
Here’s how CDPs accomplish this.
Technology can only achieve this by aggregating all customer data across any data source, then providing a smooth, intuitive interface. This enables marketers to leverage the data to target and personalize their campaigns and next steps.
A customer data platform’s abilities allow marketers to orchestrate customer experiences in and across channels while also providing rich insights on customer behavior and campaign performance.
What does this look like in practice?
Customer data platforms in action
The short answer is that it depends on your company’s needs. While all customer data platforms will help you leverage your data, what you do with those capacities is up to you. Add to that the crowded martech space and it can be very difficult to see what CDPs look like in action.
We’ve done the groundwork for you. Our CDP Buyer’s Guide walks you through every step of customer data platforms, from the basic essentials to what you need to know specifically to move forward on your journey to solutions.
Download the CDP Buyer’s Guide today to discover what customer data platforms offer you.
Customer Data Platforms + Other Marketing Tools
Do you find yourself confused by the sheer number of initials, acronyms, and abbreviations used in the martech world? Have you tried to figure out how all of the solutions interface with each other and your needs, only to find frustration and disappointment?
These struggles can be particularly acute when companies and organizations research customer data platforms (CDPs) and their relationship with other martech solutions. Typically, this is because of the sheer size and scope of the systems in question.
Here is our guide to grasping the unique value propositions of the most common acronyms, what they offer, and how they differ from customer data platforms. We will also touch on how each system interfaces with a customer data platform and how you can use these partnerships to take your business to the next level.
Let’s get started.
Tool
What they do
How they work with a CDP
Data Management Platform (DMP)
DMPs focus on anonymized third-party data specifically for managing paid digital advertising and marketing platforms.
A CDP leverages the capacities of the DMP to bring highly-curated PII to your advertising campaigns.
Customer Relationship Management (CRM)
CRM tools are designed for sales and services to track direct customer interactions and perform basic automation.
CDPs can push audiences to CRM tools for streamlined downstream management and ingest data from CRM tools to support audience segmentation and personalization.
Multi-Channel Marketing Hub (MMH)
These systems specialize in managing and deploying marketing campaigns to end channels, like email, social media, or SMS.
Typically, clients use one or the other, due to the considerable overlap between these systems.
Digital Personalization Engine (DPE)
A DPE identifies the best user experience for an individual and alters the online experience through visual presentation, recommendations, or triggered messaging.
CDPs sync audiences to DPE tools for downstream management and personalization.
Master Data Management Platform (MDM)
MDM solutions manage, consolidate, and optimize all critical data within an organization.
When used together, MDMs and CDPs can provide an amazing overview of the entire company’s data as a whole.
Data Lake
A data lake is a centralized repository for storing all your structured and unstructured data.
CDPs can share all customer data to a client’s data lake, streamlining the process of sharing information.
5 Secret Powers of
Customer Data
Customer data is powerful and brands need it to thrive in this constantly changing digital era. It is your biggest, and most unique competitive advantage. Here are five secret powers you may not know your customer data has.
Is a CDP right for you? 8 Things to Consider
Customer data platforms are confusing at the best of times. These massive software solutions are intended to unify a company’s customer data across online and offline sources, allowing you to leverage your customer data as never before.
However, every company has different needs, capacities, and employees. How can you know what customer data platform is right for your unique combination?
Here is a checklist of what you need to know to assess customer data platforms and discover what is right for you.
How a CDP Can Make You the MVP
Marketers face an incredibly complicated and tricky world today. Consumers are better informed than ever and don’t hesitate to share their opinions with people all over the world. With the click (or absence of) a tap, or a swipe, campaigns, and strategies that worked are rendered irrelevant and outdated.
How can marketers stay ahead of the curve and become the most valuable people (MVP) for their companies? The answer is in your customer data.
The state of customer data today
The world of customer data is a crazy, crowded, and complicated maze of collection points, regulations, privacy laws, and opportunities. It can lift companies far above their competitors or sink organizations into conflicting messages and relative obscurity.
In a nutshell, it’s complicated. This is where a customer data platform solution shines bright.
What does this look like in practice for marketers?
Five ways that a CDP lifts marketers above the crowd
1. Increase operational efficiency
The bottleneck between marketing and their technical partners in IT, data science, and engineering is very real and time-consuming. Many times, anything that will cut down on that strain is appreciated by everyone.
A quality customer data platform democratizes this kind of critical customer intelligence so marketers can focus on marketing without the wait. It also allows transparency between departments and creates a central location for everyone to access the data they need to move forward.
2. Increase revenue generation
The more available and accessible customer data becomes across the marketing program, the better you will know your customers. As a direct result, the speed at which new campaigns can be tested and deployed allows teams to do more and be more granularly personal, which generates more revenue.
The more insight into customer preferences and behavior you have, the better your decision-making will achieve business-level objectives. Customer data platforms streamline and support revenue generation throughout these processes in ways that other martech solutions simply can’t.
3. Reduce media spend
On average, media spend generally accounts for one-third of all marketing costs. A CDP can dramatically cut this number down.
For example, with the right data ingestion, analysis, and incorporation in place, suppression lists can update automatically instead of manually. Simultaneously, you can also increase ROAS with more fine-tuned retargeting audiences.
A customer data platform’s built-in testing capabilities feed your segmentation and overall customer intelligence. This directly optimizes campaigns and enables you to assess ROI across your media landscape for much less.
4. Streamline technology costs
A CDP enables you to see your data all in one place. This in turn, allows you to focus on getting the most out of every capability in your current stack and eliminate excess spend on solutions with redundant functionality.
By being tech agnostic, you have the flexibility to assemble your plug-and-play dream team or to optimize your workflows around the strengths of suboptimal tech solutions with which you’re momentarily stuck.
5. Optimize workflows
When your team has a home base from which they can operate the entire stack, the manual work of marketing becomes a natural extension of thinking. Before, this seemed like a pipe dream. Now, it can be a reality.
That’s the power of centralized, organized data. And it’s only the beginning.
Simplify the CDP Conversation within Your Organization
One of the challenges of acquiring a customer data platform (CDP) is that it can be unclear who should own the process. The muddle typically happens between Marketing, IT, and Production. However, you can easily avoid this confusion if you start with the proper process in place.