The ABCs of CDPs
Customer experience is what sets organizations apart from their competition. Data is what helps manifest better experiences.
That’s why the market for customer data platforms (CDPs) is growing rapidly. In a recent Forbes report, 78 percent of companies surveyed either have or are developing a CDP. If your business isn’t one of them, it’s time to give CDPs a closer look.
We sat down with Matt Skinner, product marketer at Adobe, to learn CDP basics and uncover what businesses need to know when evaluating CDPs.
What is a CDP, and why do I need one?
CDP stands for customer data platform. What makes a CDP unique is its ability to gather data from every corner of your organization and make it available for activation across all touchpoints. It prevents the disjointed customer experiences that often result from disparate data sets and organizational silos.
While it’s true a CDP is similar to a data management platform or DMP, like Adobe Audience Manager, there is a very important difference between the two. While DMPs focus on managing unknown pseudonymous user data, CDPs can rationalize that information with known customer data, and even store and manage personally identifiable information — PII — like email addresses, street addresses, and phone numbers.
By connecting known customer data with pseudonymous data points like web analytics, a CDP can create a unified profile of each customer. This complete view allows you to deliver more powerful, personalized experiences.
What exactly is a customer profile, and how complete should it be?
A customer profile is a centralized collection of all the data points you have about an individual customer. The more complete a customer profile, the better the customer experience you can deliver. You want to make sure that you have a clear understanding of who you are targeting across all devices and channels. The more data you have, the better.
But it’s not enough to just have all the data in one place. A customer profile needs to be constantly refreshed so it is always giving the latest, most accurate view of each individual. When updated in real time, a customer profile can help a customer service representative know what a customer was doing before they called, giving the rep key information on the kind of help that will be needed and delighting the customer by limiting the information they need to provide. Or if a customer upgrades from silver to gold in your loyalty program, you can immediately know to adjust the communications they receive.
When you say fresh data, how fresh is it really? How is the data updated?
Is it safe to have all that customer information in one location?
Protecting and respecting customer data has never been more important. A CDP requires robust governance tools and must adhere to national and international regulations like the new California Consumer Privacy Act and GDPR. Data security should always be top of mind. That’s why the Adobe real-time CDP allows customers to meet all of these requirements.
What should I do with the data in my customer profile?
Marketing use cases — like informing paid media, email, and in-app experiences — are probably the most obvious use of unified customer data, but there are so many more ways to maximize the value of your CDP.
Customer insights can help you build more meaningful messages and campaigns for larger audiences. Data can also be made available to other systems within your organization. IT and data science teams can leverage CDP customer profiles for their own analyses and segmentation work. Call centers, customer service, and sales can use profiles as well to help them deliver more personal interactions.
What type of integrations should I plan for my CDP?
Marketers should think through all the touchpoints where they want to deliver personalized experiences and seek to connect to each of these environments. This could include, but certainly isn’t limited to, your CRM, web analytics, media campaign data, and email personalization engines. The Adobe real-time CDP offers many out-of-the-box integrations with key destinations. Our services are also open and extensible, allowing IT teams to build custom integrations to internal systems.
Can a CDP handle the complexity of any business, or are they better equipped for specific businesses or verticals?
Any customer looking at a CDP needs to evaluate a vendor’s ability to not only work with an organization of your current size but also their ability to work with the size of organization you hope to become. A common risk with many CDP solutions is that they’re still in start-up mode — they simply don’t have the resources or technology yet to keep up with customers as they grow. Find a solution that can scale up with you.
As you research CDP options, you’ll also want to pay close attention to the product integrations each offers. When a CDP solution has worked with a partner to design the integration for their product, you receive the benefits of a system with deep product knowledge and oversight.
To evaluate different CDPs, consider starting by identifying the use case for a CDP in your organization. What are the things you need to be able to do to derive value from your investment? Then, work to understand how a potential CDP partner would facilitate that use case to meet your particular organizational needs.
What role does AI play in how a CDP works — or works well?
Artificial intelligence and machine learning in a CDP help democratize data science with features built specifically for marketers. For example, AI helps deliver streamlined workflows and surface audience insights that may otherwise go unnoticed. Additional capabilities like propensity scoring allow marketers to use the CDP to better understand their customers and build granular audiences for campaigns.
How much strain will adding a CDP put on my IT team?
The great paradox of some point-solution CDPs is that they seek to make it easier to integrate with systems, and yet they represent a new system that needs to be integrated. To minimize strain on your IT team, it’s important that a CDP has pre-built connectors to your most needed touchpoints. Adobe customers benefit from this form of streamlined implementation.
What will happen if I don’t have a CDP in two or five years?
If you’re not unifying customer data, you’re knowingly pursuing imperfect approaches to marketing. The day you invest in a CDP solution is the day you begin succeeding in customer experience management. This strategy helps you grow the lifetime value of your customers and attract new customers. The longer you wait, the more you risk falling behind competitors who are eager to deliver better customer experiences.
What’s the first thing I should do to plan for a CDP?
Do your due diligence. Familiarizing yourself with CDP solutions and conducting preliminary research is a great place to start, but it is also important to connect internally with colleagues who would benefit from centralized data management. Work with groups like your IT, data science, and customer insights teams to define and scope out the requirements for a CDP solution that will benefit your entire organization.
Learn more about how the Adobe real-time CDP can help you deliver more personalized customer experiences and grow your business.