In a world of buzzwords how much can another acronym confuse us? When it comes to a Customer Data Platforms, or CDPs, it leaves us all asking WTF!?! CDPs are the newest and most ambiguous term to hit the market since “premium inventory”. Those selling this technology would like us to believe it’s the best thing since sliced bread but most are just rebranded Data Management Platforms (DMPs) touting a new name.
CDPs emerged because of increasing data privacy laws like GDPR and CCPA which stipulate that people’s data can only be used if they give a company explicit permission. This resulted in demand for first-party data products. Despite promises of legitimate data management to support these concerns marketing clouds, campaign managers, homegrown solutions, and other legacy approaches have fallen short of delivering helpful and personalized experiences.
So, what’s a CDP? These companies claim a point of differentiation because they deal exclusively with first-party data. The main differences between a CDP vs. DMP is a CDP is supposed to be about managing an individual customer with a single profile, while a DMP is about managing segments of customers with anonymous profiles. Still confused? So am I.
A CDP serves as the single location for marketers to access the full history of detailed customer behaviors across all channels and touch-points, online and off. The unification layer is the engine of the CDP and is the most critical element in determining the effectiveness of all downstream capabilities and product features. A strong data foundation will enable your marketing teams to go from idea to action up to 80% faster—giving you speed to market measured in hours rather than weeks and months.
With marketers investing in technology it’s no wonder why new offerings are emerging. According to an April report by Forrester Research, US marketers will increase their investment in marketing technology by 27.1% over the next four years, spending more than $122 billion on marketing tech by 2022. It’s important to remember that it’s not just about investing in technology it’s about investing in the RIGHT technology.
Deciding which technology to use can be difficult as marketers, on average, must access 15 different data sources to get a complete customer view. These sources contain years of data spanning across purchase information, browsing history, demographic information, email addresses, physical addresses, and more. The data is currently sitting in disconnected legacy systems, data warehouses, or data lakes that are not directly accessible to marketers.
Enter Customer Data Platforms (CDPs), to solve all of our problems, or at least we hope. If what they are selling is true, brands now have a foundational data layer that can manage individual consumers in a data compliant way. In doing so you put the consumer at the center of personalization and create a scalable hub of customer-centric, data-driven transformational growth:
Now, more than ever, brands are looking to technology to deliver hyper-personalized customer experiences. In order to compete and win on experiences, it is critical for brands to access and act on all their customer data with maximum speed, agility, and intelligence.