As people and businesses migrate to digital platforms in greater numbers across multiple segments, legacy brands face unprecedented competition from digitally-native industry players—all vying for the attention of new customers.
However, while online marketing and sales channels enable various advanced scenarios that facilitate your success and growth, they also contribute to the mounting problem of data consistency. Detailed customer data has become a hallmark of organizational success, but sometimes organizations struggle to adequately manage massive amounts of information. As a result, Customer Data Platforms (CDPs) are rising in popularity.
Sure, there are other ways for businesses to handle, secure, analyze and use the data they gather to benefit their clientele and develop meaningful and lasting customer relationships. But these resources can also strain operational budgets, making it imperative for companies to optimize spending and generate consistent revenue streams while building a loyal customer base. With that said, it’s vital to create highly targeted, unified interactions that deliver everything customers are looking for with regards to consistency, alignment and contextual relevance from brands they connect with. CDPs are the first step to achieving all that and more!
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What’s a customer data platform (CDP)?
A Customer Data Platform is an all-inclusive software that offers a unified, persistent customer database. Essentially, it’s a prebuilt system that merges customer data from various sources, making it obtainable to different systems for better customer service, enhanced promotional campaigns and improved customer experience initiatives.
Most businesses use these CDPs to create customer profiles by consolidating data from many first, second and third-party sources. This includes your data management platform (DMP) and customer relationship mangement (CRM) system, web forms, transactional systems, social media activity, email, e-commerce, website behavioral data, etc.
How is a CDP different from a CRM?
CRM platforms are designed to engage and interact with customers. The interface is based on general and historical customer data to create a persistent customer profile. They are not built to consume massive volumes of data from different sources.
CDPs, on the other hand, let users connect to all sources and types of information related to customers, whether external or internal, unstructured or structured, streaming or batch. This enables you to get a fair and extensive view, better comprehend your customers and take actionable measures in real-time. Customer data solutions help you create an integrated database that centralizes all your customer-related information accessible to various systems. Far from merely aggregating your data, a CDP is built to gauge multi-source data while providing valuable recommendations, insights and a holistic outlook based on data from various customer journey stages.
Your clients demand and expect tailored experiences, and an effective way to deliver that is by improving your understanding of their needs, wants and preferences. A CDP provides the basis for in-depth analysis that allows you to enrich every customer touchpoint.
While CDPs and CRM solutions both gather customer data, CDPs formulate an integrated customer profile accumulated from multiple offline and online data sources. CRMs only keep first-party data or direct customer interactions with the brand.
Examples of Customer Data Platforms
There’s a variety of feature-rich software are out there that can be well-suited to your particular needs. Listed below are a few examples we think are strong contenders for any modern business.
Microsoft Dynamics 365 Customer Insights
Microsoft Dynamics 365 Customer Insights is an enterprise-grade CDP that provides information in real-time. The app is designed on the Microsoft Azure hyper-scale platform that delivers robust analytical capabilities leveraging Azure-related Machine Learning (ML) models and Microsoft AI.
Microsoft’s Customer Insights platform delivers a comprehensive customer outlook by unifying and integrating data across multiple sources and distinctively enriching profiles with exclusive, first-party audience indicators. You can also easily extend and customize it with the Microsoft Power Platform for improved data processing. The solution is used across various industries by organizations of all sizes—providing sales, marketing and other service professionals the opportunity to personalize engagement at every touchpoint.
Another excellent enterprise CDP, Simon Data empowers businesses to deliver personalized, data-driven customer experiences irrespective of their location. The platform leverages machine learning and big data to influence customer communications across different channels. This unique approach enables brands to create and deliver outstanding customization capabilities without developing and maintaining substantial modified data infrastructure.
One of the world’s leading CDPs, Twilio Segment provides enterprises with an accurate data foundation to put their customer base at the heart of all decisions. It allows you to gather, amalgamate and route your customer data into different systems where it’s required to comprehend your customer behavior better and create compelling, seamless experiences in real-time.
Business benefits of using Customer Data Platforms (CDPs)
Using a customer data platform can deliver numerous advantages for a business, including but not limited to breaking down silos, centralizing customer data, facilitating customer experiences and automating workflows.
- Break down silos between departments and increase collaboration: Data silos occur when organizations scale too fast to exchange data adequately or when technological advancements cannot be sustained. Silos create a less collaborative and interactive environment, reducing the productivity and the pace of your organization while also threatening the accuracy of customer profile data. CDPs can help your company avoid data silos by unifying your employees and customer data. As a result, you can be assured that your data is accurate and accessible to all. Customer data management is the procedure of obtaining, organizing and leveraging customer data; CDPs make this process extremely simple by structuring your customer data to make it valuable and practical. Consolidating your data requires a bit of a system when you start to use a CDP, but once you set it up, it requires little maintenance.
- Centralize customer data: A powerful CDP lets you combine data from various tools to develop a single integrated customer database that contains data on every touchpoint and interaction with your service or product. You can then segment the database in countless ways to create more targeted and personalized marketing campaigns. CDPs provide an accessible, central and helpful customer data source that multiple departments can leverage to help sustain and grow your business. From sales to marketing, business intelligence and customer service, a CDP offers an accurate and single source of truth to drive business growth.
- Facilitate smooth e-commerce experiences: CDPs allow you to consolidate information seamlessly from specific data sources alongside other systems where the customer journey includes additional business processes. That way, with regards to e-commerce, you can gain maximum advantage from the actionable insights about your customer base via several channels. For example, you can gauge a buyer’s purchasing patterns in-store that can enable you to deliver targeted and tailored digital experiences to the same customer, leading to successful virtual sales.
- Digitize and automate workflows: CDPs provide companies with a tool to develop and connect an adaptable technology stack, flexible to the ever-changing customer behavior and technology trends. They give businesses the resources to collect data from everywhere and leverage it irrespective of their (or the customer’s) location to provide better customer experiences. This software offers automated workflows for data collection and unification, reducing the need for your IT teams to manage the data flow between systems. In addition, automating business workflows ensures that all your data sources are constantly refined, ingested and validated. With a robust CDP in place, you can seamlessly and automatically build targeted marketing campaigns with personalized messages and offers in real-time across various channels. The amount of information gathered by CDPs also enables marketing teams to consistently improve their brand campaigns through automated reporting and measurement and ultimately enhance their efforts on how well their messaging resonates with the intended audiences.
Want to learn more about Customer Data Platforms (CDPs)?
CDPs are only going to become more prevalent for IT providers and businesses alike! Working with a knowledgeable partner can help you stay on top of tech innovation. Check out our Partner Guide for more information about how Sherweb can help your business grow. If you want to chat further about CDPs specifically, don’t hesitate to reach out to us.