Managing customer data is nothing new
For decades, people have been looking for the right tool, from handwritten filing cards and massive independent mainframes to modern platform alternatives. Customer Data Platforms (CDP) have emerged as a game-changing tool for enabling and speeding up organizational digital transformation. If done effectively, it has the potential to be the hub of your organizations whole marketing technology platform.
This article will assist your business in selecting the best CDP to ensure results and increase the profits.
What is Customer Data Platform (CDP)?
A Customer Data Platform (CDP) is a software that gathers and organizes customer data across a variety of sources and makes it available to other applications, systems, and marketing campaigns. CDPs take real-time data and organize it into individual, centralized consumer profiles.
The customer data that CDPs collect and organize are of four types.
- Identity Data: It builts the foundation of customers profile by collecting data such as their name, contact, location & demographics.
- Descriptive Data: It provides a more complete view of the customers career, lifestyle, family & hobbies.
- Quantitative or Behavioural Data: It allows businesses to understand how the customers have interacted with them, either through email communication, transactions or online activities
- Qualitative Data: It gives customer data personality. This type of information gathers any motivations, opinions, or attitudes expressed by a company’s customers.
Benefits of Customer Data Platform (CDP)
CDPs help your organization run more smoothly, increase customer interactions, and supplement your existing technology and marketing activities. Here are a few key benefits of having a CDP.
CDPs collect publicly available data directly shared by customers –The primary goal of CDPs is to collect first-party data via images and other tracking techniques. As a result, you can be rest assured that your CDP always represents the most accurate audience data.
CDPs help you to get to know your customers –It enables you to manage the customer relationships and market with the audience in mind, accurately and effectively.
CDPs Unify Cross-Channel Marketing Efforts – They also gather and organize new data that can be used to influence upcoming marketing efforts.
CDPs help in campaign optimization and long term learnings –By implementing a customer data platform, marketers can see the efficiency and outcome of the campaign they want to analyze. Marketers can improve their subsequent efforts to promote a product or service by thoroughly understanding the previous ones.
CDPs help in increasing revenue – An effective CDP helps you to improve your revenue, by facilitating delivery of focused, tailored information and offers to the customers. Finally, it can increase the ROI of your marketing investment because better data leads to better decisions.
CDPs help in cost saving – A central view of customer data saves analysts a lot of time in gathering and cleansing of the data. Since the data is mainly persistent in the customer data management platform and not in the app, you might reduce costs by having a single point of contact for each customer.
Types of CDP
Gartner has stated there are four types of CDP:
- Marketing Cloud CDP
- Smart Hub CDP
- Marketing Data and CDP Integration
- Engines and Toolkit CDP
These categories can help determine which type of CDP is best for your organization. In fact, you may already be using a CDP but aren’t aware of it.
Marketing Cloud CDP –Marketing teams and organizations that already use well-known marketing CRM, ESP tools and SAP, Adobe, Salesforce, Microsoft, or Oracle, a marketing cloud CDP may be the best bet.
Marketing cloud CDPs are the newest CDPs and are available from well-known cloud providers. These platforms are great at capturing data and allow organizations to work off of a single database. If you’re already using one of these tools for data collection and business management, it may be best to reach out to your rep to learn more about their offerings.
Smart Hub CDP –Organizations require a simple and easy-to-use interface but do not involve as much deep or technical CDP functionality. From the beginning, smart hub CDPs put great emphasis on marketing coordination and personalization through a single interface.
The smart hub CDPs have accomplished this by developing a simple, clean, and user-friendly backend interface to assist marketers in making the most of the tool and improving customer experience.
Marketing Data and CDP Integration – For organizations who collaborate closely with data and development teams and have a need for similar data collection, these CDPs are ideal to provide access to a larger platform.
Marketing data integration CDPs focus on the data. They have reliable APIs and data governance capabilities, but they also provide marketers with flexibility and ease of use.
For the best results, these platforms will almost certainly need to be utilized in combination with other visualization platforms. Marketing data integration CDPs are referred to as “pure play CDPs” since they are solely focused on the primary function of a CDP: the proper collection and management of first-party data.
Engines and Toolkit CDP – Well-funded organizations with very specific CDP use cases for which no best-in-class CDP can solve.
CDP engines and toolkits are intended for organizations that wish to develop their own solution. These are free and open-source solutions.
Building your own CDP isn’t worth the effort for most businesses – unless your product is that CDP.
How to choose the best one?
Choosing the right Customer Data Platform for your organization is key to realizing the potential business value it can provide. Following are the steps to choose the best CDP.
Bring stakeholders into the process – The CDP you choose is going to be working with data from different departments within your organization, so it’s important that everyone is on the same page. You need to bring internal stakeholders into the buying process before you decide which CDPs you’re going to evaluate.
Define use cases – Consolidating your data isn’t going to make you more data-driven; it’s just a step along the way. In order to choose the appropriate CDP, you should first define your use cases. Identifying three ideal use cases will help you decide which CDP is best for your organization.
Determine the tools needed – Identify what tools and functionality you’ll need to run your customer data platform (CDP). Make a list of all the tools that interact with your customer in one way or another. Double-check that you haven’t missed any important tools that will need to be connected.
Gather requirements – There’s more to a CDP than a way to consolidate data and solve your use cases. A CDP should help you get a solid understanding of each piece of data that you’re collecting. The pricing pages of each CDP are another good place to gather requirements.
Compare Vendors – Choose a few CDPs that fit your use cases, have the necessary integrations, and meet all of your requirements. Each CDP should have the right experience for the use cases you’re looking for.
Consider ROI – The final factor to consider is the ROI of the CDPs you’re evaluating. Your professionals will have to spend hours building and maintaining integrations for each tool if you don’t use a CDP. A good CDP should reduce the amount of time your professionals spend developing tool integrations.
Choosing a CDP is a time-consuming process. You must ensure that you are doing your due diligence in order to find the best CDP for your specific use cases and requirements. Locobuzz, as a platform, will help you to extract more value from your data and gain a better understanding of your customers. Furthermore, your professional team will thank you for reducing their workload because they will no longer have to spend time building and maintaining integrations with your tools.