A customer data platform, usually called a CDP, is a marketer-managed system designed to collect customer data from all sources, normalize it and build unique, unified profiles of each individual customer. The result is a persistent, unified customer database that shares data with other marketing technology systems.
The idea of a single view of the customer has been on marketers’ wish lists for years. But disruption caused by the global COVID-19 pandemic has raised interest in precisely the types of solutions that CDPs deliver, which includes that single-view of the customer. With pandemic concerns spurring the movement of customer interactions – both B2B and B2C – to digital channels, marketers are increasingly interested in technologies that collect data from those interactions, unify them, deliver insights and enable campaign orchestration.
As the marketer appetite for CDPs has grown, existing companies with various backgrounds — from tag management to analytics to data management — have seen the opportunity and refashioned themselves in the CDP mold. Meanwhile, others have started up with the CDP category in mind from the start, and some well-established players have responded to market pressure and developed a CDP capability.
We support the CDP Institute’s definition of a “RealCDP,” which requires it be able to do the following five things:
Virtually all of the CDP vendors that meet that criteria provide the following core capabilities:
CDP vendors differentiate by offering more advanced capabilities that include, but are not limited to, the following:
Now, let’s look at the key considerations involved in choosing a CDP.
Data collection and maintenance is a core CDP function. All CDPs provide a central database that collects and integrates personally identifiable customer data across the enterprise.cFrom there, however, CDPs vary in their abilities to manage the following:
The importance of each of these data management capabilities will depend on a particular organization’s business goals, and whether it has a significant mobile presence, direct mail budget or brick-and-mortar stores and/or agents.
CDP vendors offer data analytics capabilities that can do some or all of the following: allow marketing end-users to define and create customer segments, track customers across channels and glean insights into customer interest and intent from customer behavior and trends. The specific tools provided can include predictive models, revenue attribution and journey mapping. To one extent or another, many of these capabilities may utilize machine learning or artificial intelligence to surface insights about audiences and proactively offer suggestions about the best next step to move a prospect through their purchase journey.
A select group of CDPs provide campaign management and customer journey orchestration features that enable personalized messaging, dynamic web and email content recommendations, as well as campaigns that trigger targeted ads across multiple channels.
The CDP often automates the distribution of marketer-created customer segments on a user-defined schedule to external martech systems such as marketing automation platforms, email service providers (ESPs), or web content management systems for campaign execution.
For example, the CDP could deliver targeted content to a web visitor during a live interaction. To do this, the CDP must accept input about visitor behavior from the customer-facing system, find the customer profile within its database, select the appropriate content and send the results back to the customer-facing system. A CDP may also facilitate digital advertising through an audience API that sends customer lists from the CDP to systems (i.e., DMP, DSP, ad exchange) that will use them as advertising audiences.
CDP vendors vary in the support they provide for compliance with the wide range of vertical market and international regulations that safeguard customer data privacy.
