CDP: Discover What You Can Accomplish with One

February 6, 2023February 6, 2023 Stan

According to Wikipedia, a Customer Data Platform – or CDP for short – is “a collection of software which creates a persistent, unified customer database that is accessible to other systems.” It is the way in which a company can take data it has acquired from a number of disparate sources to create a single view of their customers and provide those customers with a unified, personalized marketing experience across all channels they interact. That, my friends, is marketing nirvana.

Marketers know all too well, unfortunately, that gathering and using unified customer data is not an easy task. In many organizations, customer data exists in a number of different systems that simply aren’t geared to share it with anything else. To integrate that data requires cobbling together various data tools to make systems talk to each other, data warehouses or data lakes, or relying on a large number of flat-file extracts and human intervention to make meaningful connections with the data about a customer. And even then, marketers are frustrated by only being able to see part of the story — those interactions that only happen on certain channels.

CDPs change the conversation. First, it puts data federation in the hands of marketing, which means that marketing requirements are front and center during the design and development of the system. Second, CDPs are pre-built software systems designed to meet the unique needs of each client. Utilizing specialized processes and technologies, CDPs provide a more efficient way to unify customer data from a number of different systems and generate a cohesive view of the customer for analysis or further marketing efforts.

How Does a CDP Work?

In the simplest explanation, a Customer Data Platform creates a comprehensive view of each of your customers, links all information related to that customer from all available channels, and stores that information so that you are able to track a customer’s behavior over time. Each customer profile is assigned a unique identifier so that it can easily be linked to other marketing, database, and reporting platforms to target marketing messages and campaigns, and track results to the individual level. The key is that CDPs are built FOR marketers, not for sales or finance. Their purpose is laser-focused on putting the power of data into the marketer’s hands and proving to your customers that you know who they are, what they’ve done, and what they want, at any time and on any channel.

The CDP takes structured, unstructured, and semi-structured data and blends it for a singular view of your customers. It can ingest data from any source, including email, social, loyalty, enterprise resource planning (ERP) systems, customer relationship management (CRM) platforms and data management platforms (DMP). And it’s not just demographic and firmographic information. The CDP can include purchase history, every email click, every web visit, every search on your site, and literally anything else you want to capture. It is up to you! Additionally, CDPs provide you with the means to analyze and segment customer profiles using rules and/or machine learning, perform predictive scoring and weighting, and provide customer journey orchestration.

Why Do I Need to Know?

The bottom line is that companies who invest in Customer Data Platforms greatly outperform those that don’t, and the returns are cumulative. This means that the longer you’re using a CDP, the greater the success due to the aggregation of more and more actionable data. Not only does the CDP house a reliable source of customer profile data, but also it enables your company to comply with all privacy regulations and be able to adjust and adapt as future regulations unfold. It will better enable your company to personalize campaigns, hyper-target and segment your audiences to avoid fatigue and burnout, and enable true cross-channel campaigns. And with a CDP, you can analyze all that behavior and campaign data from one source to truly understand marketing ROI and where budget should be spent for the best results.

Additionally, realizing value takes less time than you would think. According to Advertiser Perceptions, the average length of time to realize a CDP’s full value is 8 months. Even more impressive, more than 74% of companies with a CDP report that they realized a return on investment (ROI) within the first year. Imagine all that you could accomplish if, by the end of the year, you could have a new part of your tech stack in place with robust customer profiles in place and consistently delivering real-time, personalized, and relevant customer journeys at scale.

Are you ready to investigate adding a Customer Data Platform to your marketing tech stack? Relationship One can help. Contact us today!

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