Customer Data Platform (CDP) Explained – The Brief Guide
Customer Data Platform (CDP) Explained – The Brief Guide
In the digital era, data is the new gold. And like gold, it’s not just about having it but also about using it right. This is where the Customer Data Platform comes into play. It transforms the way companies handle their customer data and paves the way for intelligent marketing and targeted customer engagements.
Here’s a brief guide to CDP.
What exactly is a Customer Data Platform?
A CDP is a specialized software for marketing technology, specifically a kind of unified customer database software that consolidates all customer data from various sources in one place and creates a unified data record for each customer. Thus, a CDP captures, stores, categorizes, and synchronizes all data from CRM, ESP, DMP, APIs, POS, and other sources, developing a 360-degree customer profile which can be used for precise segmentations and personalized marketing campaigns and their analyses among other things.
Building a Customer Data Platform
To create a CDP, three main phases are necessary:
- Integration: Merging all relevant data into a single database is the main task of a CDP. To begin, all sources and systems must be connected to the CDP.
- Organization: After integration, a CDP requires quality control protocols to identify missing information, remove duplicate records, and check accuracy.
- Identity Resolution: Merging data from different sources and attributing them to specific customer profiles is the shining aspect of a CDP.
Features of a CDP
Different companies offer various CDP solutions, but the best are characterized by some essential features:
- Easy Integration: All data sources can be integrated without significant programming effort.
- Single Customer View: The customer data collected and organized by a CDP is visualized through individual data profiles for each user.
- Unification of Customer Data: Inconsistent data from various online and offline sources are combined.
- Accessible Data for Third Parties: Data within a CDP is ready for use by systems focused on adtech and campaign delivery and can be easily exported.
CDP Competence Requirements
A CDP is primarily a tool for marketing and sales. But to get the most out of it, typically three roles are required:
- Marketer: Someone who understands the market and can propose business-specific use cases for the CDP.
- IT Professional: Someone who supports the marketer during the implementation phase of the CDP.
- Analyst: Someone who can handle and analyze data.
Why is Customer Data Important?
Customers expect a lot from companies nowadays. If you want to keep their business, you have to meet these elevated standards. A CDP enables having well-maintained, accessible, and insightful customer data to make tailored offers to your customers.
What Customer Data Does a CDP Process?
A CDP is specifically designed to manage the flow of digital data and can include the following data:
- Events: Behavioral data resulting from a user’s actions.
- Customer Attributes: Names, addresses, contact details, birthdays, etc.
- Transaction Data: Purchases, returns, and other information from e-commerce or POS systems.
- Campaign Metrics: Engagement, reach, impressions, and other metrics from campaigns.
- Customer Service Data: Live chat data, number and length of interactions, frequency, NPS scores, and other data from CRM systems.
Types of Customer Data Platforms
You should choose a CDP based on the target market and intended use cases.
- A Standalone CDP: A standalone CDP captures all first-party data of a company and creates complete pictures of all customers. Normally, such a CDP offers analysis functions that allow detailed segmentation of the audience. This data is accessible for other systems, but the standalone CDP cannot execute campaigns.
- CDP + Marketing Automation: A Customer Data Platform combined with marketing automation is the next generation of CDP. It combines all the advantages of a standalone CDP with marketing campaign tools, creating a single, powerful, customer-centric marketing platform. This enables marketers to create impressive customer experiences by bringing AI-driven marketing, real-time analytics, and UX optimization together with a CDP.
Key Benefits of a CDP:
- Lays the foundation for a 360-degree customer view.
- Enables customer loyalty-driven decision making.
- Allows for more precise audience targeting and higher quality interactions with customers.
- Enables meaningful analysis of marketing initiatives across various channels.
- Enables agile responses to market changes or customer preferences.
Selection Criteria for Enterprise and SMEs
The range of providers doesn’t make the decision easy, especially when it comes to scaling. Small businesses and large corporations have different requirements that require a differentiated consideration of the respective CDP.
- Scalability is of central importance for large enterprises. They process huge amounts of data that are constantly changing. A CDP must therefore be able to react quickly and accurately to these changes. Its architecture should be designed for scaling from the outset.
- Flexibility is also crucial. No company is the same, and uniform plug-and-play solutions are usually unsuitable for the specific needs of a large enterprise. A CDP must be able to integrate data from all specific sources of a company and interact successfully with the platforms that the company uses.
- Integrity is another essential point. CDPs are entrusted with sensitive data that can affect millions of customers. This requires strict security protocols and a commitment to data protection. These aspects must be core values of the CDP provider so that they can be entrusted with customer data.
The distinction between CDPs for small businesses and enterprise solutions is not only in size but in the fundamental requirements for scalability, flexibility, and integrity. Making the right choice means knowing your business requirements exactly and finding a solution that can meet these requirements not only today but also in the future.
Customer Data & Transaction Platform by Acceleraid: Your Key to a Connected IT Infrastructure
The Customer Data & Transaction Platform by Acceleraid represents the next level of a CDP. The integration of AI allows the Customer Data & Transaction Platform to be used either as a standalone CDP or as an AI boost for existing CDPs. The inclusion of AI also allows, without a data science education, to create customer segments and start personalized campaigns quickly and easily.
The following advantages are offered by our solution:
- Data Quality Assessment: Get instant clarity about the quality of your data and benefit from concrete action recommendations.
- Maximum Data Utilization: Forget the limitations of data silos. With Acceleraid, you can optimally use all your data sources.
- Optimized Data Processing: Thanks to a special data model, you can process transaction data such as credit card and checking account information safely and efficiently.
- Minimal IT Burden: Worried about technical implementations? Acceleraid relieves you! If necessary, we take over the complete implementation, so your IT department is relieved.
- Faster Return on Investment: Security is good, certainty is better. Achieve a positive ROI within only 6-9 months with Acceleraid.
Acceleraid’s Intelligent Customer Data Layer integrates perfectly into any IT infrastructure. It utilizes all your data sources to determine which offer is ideal for which customer at the right time. Sales activities are automatically adjusted to leverage previously unused revenue opportunities. And the best part? The integration into existing marketing automation software is seamless. Acceleraid harmoniously integrates into your existing system and only provides the intelligent signals based on complete data analysis.
Contact us for a personal demo!