In the business world, data is king. Data enables companies to make the right strategic and marketing decisions. It's the key to growing revenue, scaling marketing campaigns, and getting the highest possible ROI out of everything you do. For companies that are looking to get the maximum value out of their data, they'll want to invest in a customer data platform (CDP).
What exactly is a customer data platform?
A customer data platform (CDP) is a software platform that collects records of all your customers. It unifies all the data in the business to give you a 360-degree view of your customers. A customer data platform can bring together data from all customer touchpoints in order to build a detailed picture of every customer.
More importantly, CDPs collect different types of data. This includes:
This gives companies access to deeper insights that can be used to make important business and marketing decisions, for both customers and prospects. It also combines different data types in a way that makes sense to companies.
Why should you invest in a customer data platform?
Most companies already have a way of collecting and managing their data. It's usually a data management platform (DMP) or a CRM (customer relationship management) platform. While it's a big investment to adopt a new platform, change your systems, and set up new processes, the investment is worthwhile. While both major solutions may at first seem like they do the same thing as customer data platforms (CDPs), there are many unique advantages that only CDPs offer.
As mentioned earlier, CDPs offer the ability to collect data from multiple channels and collect different types of data. But on top of that, it offers omni-channel personalization for unique experiences across all touchpoints. Most CDPs also offer identity resolution, which can connect previously anonymous sessions to a customer profile after a customer is identified.
Typically, customers only receive personalized messages, content, and offers via email. But CDPs allow companies to go beyond just email, enabling personalization across multiple channels. The attribution data provided by this platform allows companies to optimize different touchpoints in the overall customer journey. As a result, customers get hyper-personalized and consistent experiences across all channels.
An example of the customer data CDP can work with
It's important to understand that there’s a wide variety of data types that a CDP can work with. Here's a quick overview:
- Customer data like name, gender, age, address, birthdays, and more
- Campaign data such as impressions, CTR, conversion rate, email open rate, and others that are relevant to the specific channel and type of campaign
- Behavioral data like pages visited, time spent on page, products viewed, links clicked, and more
- Transactional data such as products/services bought, average transaction value, customer lifetime value, and product returns
- Custom data that you want to integrate into a CDP platform
How do you choose the right customer data platform?
If the idea of trying out a customer data platform is attractive to you, then the next step is to find a CDP vendor. It's important that you choose the right vendor to ensure all your needs are met. Here are some questions that you'll want to ask to choose the right vendor.
1. What business challenges are you looking to solve with a CDP?
What current business challenges aren’t being tackled with your current data management solutions? Are you having a hard time connecting different data types to help make the right business decisions? Are you trying to figure out what parts of the customer journey is in need of improvement?
2. Will the platform integrate with my data and channels?
You likely have data from many channels, whether it's email, SMS (text) marketing, or your custom mobile app. To ensure you get value out of your existing data and channels, you’ll want to know if that data can be integrated into the CDP. You also want to see if you can combine and customize data in the way you need it and export it without any issues.
3. Are there any case studies showing how companies used the platform?
You want to see that other companies have been able to use the vendor's platform successfully. Look for case studies that detail what various companies were able to achieve with the vendor's solution. It's even better if you can find companies that are similar to yours. It's also important to look for long term results rather than short term increases in performance.
4. Does the Vendor Meet My Needs?
Can the vendor meet the needs of an organization my size? Does the vendor provide assistance in setting up the new platform and migrating data onto the platform? What level of support is provided to their customers? How much educational training and what kind of training is provided to customers?
5. Is there the option to dive into a single customer view?
While getting the big picture is important, getting in-depth data from the single customer view is still valuable. It can help you focus on specific aspects of existing campaigns as well as go in-depth into specific advertising or marketing channels. Many customers that are used to working with CRM platforms will want the familiarity of viewing data from a focused approach.
6. What advanced features are available on the CDP?
Many data platforms are getting increasingly complex (in a good way). There's machine learning, marketing campaigns that are pushed out dynamically, support for channels like native advertising, and more. You want to see that the provider is investing in features and technology that add a lot of value for their customers. It's a sign that you're going to see continuous improvements and additions to the platform.
7. Does the vendor have a proven track record?
Does the vendor have a successful track record? Is the company growing at a consistent pace? Have they been mentioned in major publications? Do they have any big clients? What industries have they helped? You want to see that the vendor has a lot going for them so that as your company grows, the platform will be able to support your success.
By asking these critical questions, you'll get a better sense of what you need in a customer data platform. It's a smart idea to research and compare different vendors side by side to determine which platform best suits your needs. After finding the answers to your questions, you'll be able to hone in on the vendor that's right for you.
Overall, a customer data platform will go beyond what’s possible with most CRM platforms and DMPs. Many companies, organizations, and small business owners will find the move to a CDP to be a worthwhile investment that will help them make the right decisions and increase their bottom line significantly.