Customer Data Platforms – All you need to know
“A Customer Data Platform is a type of marketing database software that collects and organizes data from various primary, secondary and tertiary sources in real-time and re-organizes it to form a consolidated customer profile for each unique user. It identifies information and categorizes it so that highly chaotic data is presented to marketers in structured, meaningful ways.”
A customer data platform (CDP) is like a collage. While making a collage, a variety of small pieces of different sizes, colors, shapes are put together to form one large, cohesive picture. A CDP does something like this with customer information. It fetches pieces of information from various portals, websites and communication with customers to link the pieces and form a complete profile.
To simplify what Customer Data Platforms do –
– They collect and combine information.
– They harvest data and update profiles in real-time.
– They collect information from all customers – registered and anonymous.
– They analyze customer behavior and track customer journey.
– They can handle multiple, simultaneous input.
The kind of information collected may include –
Events – This includes the logs of a customer’s browsing activity on a website, e-commerce portal or application.
Identity related information – This includes the name, age, addresses, professional or contact information of a user.
Descriptive Information – This covers career and lifestyle related information.
Behavioral Data – This is a record of the social media activity, web browsing, pages visited and communicational attitude of a specific user.
Transactional Data – This data is a collection of purchases, returns, refunds, abandoned carts, email response rates, subscription renewal rates etc.
Qualitative Markers – This data involves recording subjective information like opinions and attitudes of specific customers. It is obtained from a Customer Relationship Management system (CRM) that logs chat and call data, frequency of service requests and quality of interaction through customer satisfaction surveys.
Marketing Statistics – These comprise of visibility, engagement, impressions, and similar quantitative and qualitative growth indicators.
Customer-company history – For new customers, the first purchase date, reviews and basket information are recorded. For existing customers, purchase history, recurrence of order and earlier customer service records are used to enrich profiles.
Contextual Data – This data allows organizations to discover meaning from all the other data collected based on awareness of the circumstances that bring about a certain change in trend. Contextual data may include location, weather, economic or political changes, past buying behavior or similar markers.
Customer Data Platforms are capable of unifying structured, semi-structured and unstructured data, keep track of modulations in customer behavior and provide penetrative vision into customer experience betterment. Their data integration capabilities allow the use of digital and physical data which may be generated by the business or acquired legally from external sources.
The addition of artificial intelligence and machine learning to customer data platforms allows the system to perform forecasting activities. This helps marketers understand the growth and improvement opportunities their organization can undertake. Further, the segmentation properties of a CDP help organizations isolate different target audiences and adopt personalization in marketing, advertising and sales.
Most importantly, CDPs put all the information in one place and make it easily available regardless of where it is acquired from. This eliminates the silo structure that CRM and DMPs utilize, making it a much easier system to work with and modify.
Types of Customer Data Platforms
Stand-alone Customer Data Platform
Such a system has all the capabilities we mentioned above. They collect and combine data, analyze it, segment it and present it visually for marketers to use. However, they cannot execute campaigns and would require a team of marketers to strategize and execute campaigns.
Customer Data and Experience Platform (CDEP)
Such a system combines the capabilities of CDP with artificial intelligence and user experience analysis. It can perform real-time analysis and present strategy and predictions based on user experience data. It presents data in a more meaningful manner and makes the jobs of marketers and analysts simplified.
CDPs can be built on-premises or used as a Service as a Solution (SaaS) based system. Their scalability suits organizational use as they can grow along with company growth. CDPs can handle multiple clients and venues simultaneously and maintain exceptional processing speed and storage capacity.
The evolution of Marketing Automation
Marketing Automation has come a long way. In succession to the Customer Relationship Management (CRM) software and Data Management Platforms (DMP) that were limited to either data analysis or sales campaigns, the Customer Data Platform combines information gathered from these platforms and additionally from other sources to provide a more complete picture of customers, their expectations, likes and dislikes, and their interactions with media as a whole.
Customer data platforms are now also being used for data management, marketing metric generation, sales prediction and analysis, personalization, user experience enhancement and advertising model creation. With its use cases broadening and innovation happening rapidly, Customer Data Platforms appear to be emerging as composite data management tools in the marketing space.