SVP of Strategy, Salesforce Marketing Cloud
VP of Data & Identity, Salesforce Marketing Cloud
The Customer Data Platform (CDP) is the hottest new piece of marketing technology. In fact, CDPs are becoming ubiquitous in marketing and seem to pop up in every marketing-related report or search. According to the 2020 State of Marketing Report, among marketers who say they use CDPs, 86% are increasing or maintaining their use of them. This leaves many companies wondering if they need one too, with some asking, what is a CDP, anyway?
That’s what this guide is for. It’s your step-by-step playbook to help your organisation decide if you need a CDP and how to best select and prepare your organisation for one. Read the chapters below in accordance with your needs.
What is a CDP?
A Customer Data Platform (CDP) is a piece of marketing technology with a handful of tools that aggregates and organises customer data across various touchpoints. CDPs collect and structure real-time data into individual, centralised customer profiles to make it easier for your digital-first marketing team to manage and pull insights from customer data.
A CDP usually includes a customer database, marketing automation, multichannel campaign management, and real-time interaction management. Essentially, CDPs are for when you need a marketing database with user-level data. To best understand this software category, let’s look at some of the underlying challenges in marketing that resulted in its prominence.
Why do I need a CDP?
We live in an era where the customer is in control. Amazon can predict what products we will buy next, Netflix recommends the shows we like with great accuracy, and Uber lets us customise trips right down to the type of vehicle we want to travel in. Customers expect companies to have an intimate understanding of their preferences, want personalised experiences, and demand fast service. It’s no longer a marketing advantage to deliver on this — it’s table stakes.
When it comes to marketing, customers expect their interactions on a company’s website to translate to their mobile app experiences and even in-store visits. The problem is that, for most companies, those environments operate off different datasets — even though the customer is the same. Customers also expect their experiences to be consistent and “in the moment” as they move from channel to channel. Most customer journeys involve over three different channels (for example, e-mail, web, and mobile app), and customers tend to move seamlessly and quickly between these channels. Most companies, however, don’t have these data environments connected in real-time.
The result is disconnected experiences for consumers and the lack of a single source of truth about customers for the marketer.
What Does a Customer Data Platform Do?
CDPs focus on four primary tasks: collecting data, unifying data, activating data, and pulling insights from data.
1. Collecting Data
Your CDP is a centralised hub, or a home, for all the customer data your company has. It’s where anyone from your company can find customer data organised in a single place.
To accomplish this, your CDP needs to identify each individual customer by collecting and stitching together data from all of your company’s different customer relationship management (CRM) platforms and customer databases, including systems that don't usually share data, like marketing platforms, service software, and e-commerce engines.
Bringing together and unifying all this disparate data and identifying each customer based on their whole engagement history is called customer resolution.
2. Unifying Data
After your CDP brings together all your company’s data and creates customer identities, the next step is to resolve those identities across devices. This means linking identity information from your known customers (such as email addresses and phone numbers) with anonymous data they may have shared before they became customers (such as anonymous cookies and mobile device IDs).
The purpose of cross-device identity resolution is to help you understand the whole picture of your customer's journeys. For example, you can look at a customer and see that their interaction began with an email campaign and continued to your website before they shared their information and downloaded content or made a purchase.
3. Activating Data
Once your CDP creates and resolves fully unified customer profiles, it then activates that data, making it available for marketers to personalise customer experiences in real-time.
This personalisation is made possible by connecting the customer data in your CDP to all the different technology platforms you engage customers with, including email-send engines, demand-side platforms, and content management systems.
4. Pulling Insights from Data
With your CDP's unified customer profiles, it’s easy to see the entire catalogue of data each customer shares and track their whole customer journey. You can also use this data to get insights about customers, segment them into groups, and create lookalike audiences and personas to help reach new audiences.
As your CDP collects and organises all your customer data in one place, it’s a great source of information that proves the reach, revenue, and ROI of your marketing efforts.
Introducing Salesforce’s CDP tool: Genie
Salesforce Genie is a Customer Data Platform that brings the power of in-the-moment data to Customer 360 with the first-ever real-time CRM. With Genie, you can automatically gather customer data into a single customer graph and profile that adapts to their activity in real-time. This data will help you create the perfect customer experience, promoting strong relationships.
Genie is for any size business. It scales as your business grows, with security, compliance, and privacy built right into Hyperforce.
Benefits of a CDP
Beyond audience segmentation, there are three big reasons why your company might want a CDP: personalisation, suppression and insights.
Personalisation: Say you see a consumer come to your website, browse a product, and leave. Wouldn’t it be great to tie everything you’ve learned about that customer to a personalised offer via email or push notification? CDPs make the unified profile available to all addressable channels, enabling personalisation and relevancy. Customers who see content tailored to their interests are five times as likely to engage with a brand.
Suppression: Sometimes, the best use of data in marketing isn’t to better target consumers — but to not target them at all. A unified profile that connects marketing and purchase data enables marketers to optimise their addressable spend by suppressing consumers that have already made a purchase and redirecting those dollars toward new customers.
What problems can CDPs solve?
CDPs can help marketers address the root causes of many of their biggest day-to-day marketing problems. In particular, there are three main challenges that CDPs can help solve.
When your data is disconnected, it’s more challenging to understand your customers and create meaningful connections with them. As the number of data sources marketers use continues to increase, it’s more important than ever to have a CDP as a single source of truth to bring it all together. Integrating your disparate data sources through a CDP makes it simple to surface customer insights at any time.
Only one in three marketers say they’re satisfied with their ability to link customer identities across all their different data sources. As a centralised hub for your customer data, CDPs can easily solve customer identification issues, bringing together data from multiple sources to create unified profiles for each customer.
Organising your data and unifying customer identity profiles are the first steps toward better segmentation and targeting. From there, a good CDP will automatically surface shared traits among customers, making it simple to segment your audiences and deliver personalised engagement to one and all.
Different Types of CDPs
CDPs are just an evolution of CRM, finely tuned for the high-scale, real-time requirements of the digital-first modern B2C marketer. They’re a natural extension of the kinds of tools Salesforce has been building for enterprises of all sizes worldwide for decades. CDPs share CRM’s goals of managing customer data to drive relevant and productive experiences.
Unfortunately, the CDP market is very cluttered, including over 100 vendors (at last count by the Customer Data Platform Institute) who call themselves a “CDP.” No two are the same. Rather than focus on vendor-driven definitions, we asked hundreds of marketers what they need from a CDP and quickly realised there are not one but two different types of CDPs.
Insights CDP — Builds a “single view of the customer” by integrating data from multiple disparate sources, handling integration and data management, and enabling analytics and activation.
Engagement CDP — Helps users with real-time personalisation, for example, of websites and mobile apps, and powers real-time next-best offer and action engagement.
The vast majority of CDPs on the market today are either insight CDPs or engagement CDPs — not both. We believe a true enterprise CDP must encompass both insight and engagement.
Next we’ll look at how companies leverage CDPs to go beyond marketing and advertising — and use connected customer data to tie together their organisations, create cross-company insights, and start to value customer data as something they can put on the balance sheet.