Widely recognised as the next step in marketing technology, a customer data platform (CDP) is the solution to the problem of disconnected customer data systems. A CDP is the key to delivering the right engagement for the right person at the right time and personalising every customer touchpoint from marketing to sales to service.
To understand the benefits a CDP can bring to your business, first it’s important to understand how disconnected customer data is holding you back.
The proliferation of channels and data types has resulted in a customer data boom. This plentiful data is typically collected by separate, or siloed, systems that can store but not interpret it.
Customer data spans everything from anonymous ad impressions to known purchases, product usage, and customer service interactions. There are three main types of customer data:
The problem with siloed customer data is that it makes it difficult to understand who your customers are, what they’re doing, and what they want. Without data-driven insight into the core of your business, decision making is limited and less effective.
Each category of customer data can be used to improve engagement with new and existing customers. In order for customer data to be useful, however, it needs to be removed from the silos, unified, and accessible.
Simply put, a CDP is the solution to the customer data problem. It’s a unified database that centralizes customer data from all sources and is accessible to other systems. Far from simply aggregating that data, a CDP is designed to analyze this multi-source data and provide insights, recommendations, and a holistic view of each customer that’s based on data from every stage of the buyer’s journey.
Customers expect and demand personalised experiences and the only way to deliver that is to improve your understanding of what they want and need. A CDP provides a foundation for that deeper understanding and can be used to improve and enrich all customer touchpoints:
A CDP can deliver numerous benefits to your organization in addition to the ones listed above:
While a customer data platform shares some similarities with other customer data solutions, it’s important to understand how a CDP differs from the other systems you might already be using.
While CDPs and customer relationship management (CRM) solutions both collect customer data, a CDP formulates a unified customer profile compiled from multiple online and offline data sources. A CRM only stores what’s known as first-party data, or the customer’s direct interactions with the company.
CDPs aggregate personally identifiable information such as names, mailing and email addresses, and phone numbers on both anonymous and known people. Data management platforms (DMPs) only work with what’s known as third-party data, or anonymous online data like cookies, devices, and IP addresses.
A CDP adds to the functionality of CRMs and DMPs by integrating the data from first-, second-, and third-party sources. This means it incorporates CRM and DMP information to provide a comprehensive view of each customer so you can find all the information you need from a single application.
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