The very first attempts to quantify amounts of data can be traced back 70-some-odd years ago.The so-called “information explosion” — a term coined in 1941 — refers to, among other concepts, the idea that information and data generation happens at an exponential and relatively predictable rate.
The turn of the millennium 19 years ago and the accompanying “digital age” has ridiculously accelerated data generation. From the growing number of connected devices to the drastic uptick in marketing and consumer shopping channels available, the vastness and availability of data continues to skyrocket to stratospheric heights.
Managing and making sense of this customer data, for marketers, has never been more challenging. But it’s never been more critical, either.
The Importance of the Customer Data Platform (CDP)
If you’ve heard it once, you’ve heard it a million times: we need lots and lots of accurate, high-quality customer data in order to create desired experiences… or meet expectations… or get to omnichannel.
OK, I’ll buy that. But what does it actually mean?
Well, it means that companies need a way to make sense of and keep all of the behavioral, transactional, and personal (demographic, psychographic) records about customers in check, clean, and actionable. It means they need a place to store it all.
What is a customer data platform?
A customer data platform is a marketer-friendly repository of sorts (could also be called a database, system, solution, etc.) which unifies all of the data being collected from every channel in use. This sort of treasury of information enables a centralized, cohesive way to bring everything together, and creates a unified view of each customer.
Key benefits of a customer data platform
Put eloquently by MarTech Today, a customer data platform serves as a “central location for customer data — profiles, personal identifiers, website visits, mobile app sessions, email responses, chat transcripts, audio recordings of customer service interactions, social media comments, purchase orders, and so on — and was intended specifically for marketers.”
Benefits of a CDP (as opposed to traditional CRM systems) include:
➤ They are geared specifically at marketers.
➤ They offer a completely unified customer profile.
➤ One component — the Digital ID — usually serves as the core around which everything else revolves.
➤ They’re typically quite flexible, serving multiple marketing purposes for campaign management, data analysis, and intelligent automation execution.
Benefits of a #CDP: geared at marketers, offer a #unifiedprofile, & serve multiple #marketing purposes CLICK TO TWEET
Adopting and Using a New Customer Data Platform
There are several key questions to be aware of when considering buying a new customer data platform.
Questions to ask when choosing a customer data platform
Is it a CDP… or something else being marketed as a CDP?
Let’s be honest. Nearly every marketing platform claims to provide this extravagant 360-degree view.
A number of robust marketing platforms don’t actually store all customer data from multiple sources in one centralized HQ. Instead, they have designed calling codes of sorts that pull data from various sources, albeit at once and in real time.
As a result, these acquired marketing clouds can mix or miss certain sources, leading to faulty, mislabeled, disjointed, or missing information!
How many tried-and-true CDP options are there on the market?
Technology analyst David Raab estimates there are a couple dozen vendors that can truthfully claim they’re a CDP.
The key to identifying the best option for you is to not start with the tech itself; rather begin with your goals and the overarching objectives you want to achieve and then match those up with the most appropriate technology.
The privacy of my customer data is critical — to what extent does data protection and governance come into play with a CDP?
While the techniques for protection might vary among providers, most CDPs are very safe and secure, posing a minuscule security risk. Encryption is common, as is anonymization — the process of “depersonifying” data so that neither the data subject, vendor, or brand can identify who specific data is about.
How to get the most value from customer data
To get the most value from data, you’ll need large quantities of high-quality data.
You don’t need endless amounts of data, but you do need enough high-value data to accomplish your goals. With this in mind, it’s important to ask:
- Which channels am I trying to drive the most traffic to?
- Which channels are driving consecutive product views?
- Which channels drive profitable and repeatable conversions?
With the help of a #customer #data platform, ask which channels are paramount, which are driving consecutive product views, & which are driving conversions CLICK TO TWEET
Once the consumer journey and all touchpoints are defined, determine which data points you want to use from those interactions. This could be a form with a preference center to better understand website visitors, a mobile phone number at checkout that supports a mobile shopping club, a product view to drive relevant content, dates when these events occur, and more.
Different types of customer data
Data is being generated at every stage of the buyer journey and every digital touchpoint customers have with your brand, including:
- The initial stage when someone begins interacting with you → location data, Google Analytics information, IP address, social behavior
- The signup, registration, or subscription process → website forms, mobile app, Facebook/Google ad conversions, website forms, preference center data
- The engagement period → email and online engagement behavior (clicks, opens, time on page, products browsed, etc.)
- The transactional or purchase period → what was bought, how much, from where, P.O.S. data, further psychographic information
- The post-purchase or follow-up stage → responsiveness to tailored content, predictions, and specialized incentives, average order value, etc.
- The repeat purchase or win-back period → customer lifetime value, qualitative feedback
Most of the data you collect about customers will fall under the quantitative umbrella and will be of a “continuous” nature (as opposed to “discrete” which means it’s unchanging). CDPs help organize the continuous, changing quantitative data being generated at all times.
The sheer volume of massive amounts of flowing data being created every day underscores the importance of a central location to store, manage, and make use of it all.
The enormity and extensiveness of data sets being generated by today’s multi-screen, on-the-go consumer is quite literally inconceivable to the human mind.
A customer data platform helps synthesize all of this incoming information that you can’t afford to miss, scramble up, or fail to connect.
CDPs are a hot topic, and for good reason — they are a big, pretty piggy bank for all of your data, and the 360-degree view they provide has colloquially been called the marketer’s “Holy Grail.” Are you ready to find your treasure? ◾
► Check out our customer data management page to learn more about the powerful CDP that sits at the core of the Emarsys marketing solution.
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