To CDP or Not to CDP is an on-going debate along with variants such as CDP vs DMP vs CRM vs Data lake. By now, most of you must be fairly conversant with what these terms signify, and from the various debates, you may have also deduced which of these is a good investment for your business. However, I know many who continue confused because of the cacophony. This is for those of you, who are unsure or sitting on the fence regarding CDP.
Without going into great technical details, let us define CDP as the single source of truth about your customers. A CDP builds and updates customer database by identifying and making a record of their interactions across multiple brand channels. What you have is a single view of your customer’s lifecycle from since the day he came in contact with you and till he continues his association with you.
Agreeably, this doesn’t sound new, yet we know that most marketing automation products today build limited databases or rely on EDW depending on whether we are talking B2B or B2C. Very few systems that build substantial databases are built for the pleasure of the IT department.
Now, as far as the customer is concerned, he’d like you to treat him as a star hotel would treat their returning guest. That in essence is what a CDP helps you do.
Doubtless, if you have read the arguments for a CDP, you’ve come across many reasons why it is a good investment. I’ll try to cover my reasons, based on my experience as a marketer who has spent much of his career helping clients craft their marketing and business development strategy often defending the what’s, why’s, and how’s of it. I wish I always had the power of hindsight to justify my suggestions, which I believe is a powerful way to look at CDP.
As of 2020, the marketing technology tools landscape is dotted with over 7000 products. Of course, you need not have all of them, but even if you’ve added a few of them (say social, commerce, analytics, customer experience) you are collecting customer data. Congratulations. But if you are collecting customer data and holding them in silos, you or your team are most likely spending the best part of your waking hours trying to connect these silos to get an aggregate view of your customer. Or lamenting your wasted $$, as I have known many clients to do.
It follows, therefore, that a system that brings together data from these silos to give you a single view of your customer is table stakes. A CDP will be able to collect anonymous customer profiles and enrich the profile with every interaction of the customer across all channels and once the customer shares his identity through a web form or an offline interaction, the CDP will aggregate both the data sets into once enhanced profile.
If you haven’t invested in any marketing technology tool yet, that’s a great place to be. Because you can build it around a CDP.
When it comes to tracking interactions, your customers have with you, CRM’s are a great solution. They give insight into your customer’s preferences allowing you to market to them accordingly. CRM solutions, however, fall short when you want to track and understand the behavior of those who are not yet in your customer database. It cannot identify the unknown ones. A CDP scores big in this area. It can mark a prospect and track his actions in one single file until it can tag him to an identifier like a mobile number or email id. This is what creates a robust single customer view, across the entire lifecycle of the customer from the time he was an anonymous prospect interacting with the brand.
By itself, CDP’s primary role is to pull data across channels, and build an aggregate view of the customer, refine it on a real-time basis and hold it. The value of CDP starts tipping over when purpose-built workflows allow you to add marketing automation to the platform triggering real-time engagement with your customers. Using real-time aggregate data to create targeted campaigns, offers, and promotions and sending it out at precise moments in the Customer Decision Journey is where every CDP should head. Which also means, CDP ingests and digests data from all your data sources and is piped to output into all your marketing channels.
As a marketer, I’ve grown from pushing my gut instincts to an abiding respect for data as the only source of truth. At Langoor Havas Enterprise, I consult and guide organizations in their journey towards building an efficient and effective marketing organization.