Companies interact with their customers on various platforms and channels to increase market standing. Running multiple campaigns simultaneously and with management expecting exceptional results, it gets stressful for marketers to keep up with evolving customer behavior and changing technology trends. The first-person data that a company collects and holds from various customer touch-points through its proprietary software and systems is the starting point of a customer’s journey guided by targeted marketing campaigns. Customers are found to be loyal to companies that meet their demands for unique and personalized communications that go beyond traditional marketing methods.
Currently, companies are under immense pressure to adopt strategies that generate adequate results in a world where cookies are no longer used for customer data. Recently, Apple Inc. and Google have taken steps to effectively prevent advertising cookies on their devices. When the source and nature of customer data varies from company to company, it is only logical that the way the given data is consolidated and analyzed also be different.
Most businesses have, over a period of time, built silos of customer data across business units and channels. In order to detect patterns leading to purchase and understand post-purchase behavior, businesses need to identify each customer uniquely across interactions by analyzing the data generated by various channels. CDP or a Customer Data Platform is a tool that consolidates existing customer data from different channels and platforms, helping marketers obtain a better understanding of the success of their marketing strategies. It solves the problem of data fragmentation and reduces visibility gaps around a customer’s behavior. Simply put, it is a one-stop solution for managing customer data. This tool allows marketers to understand and analyze customer data in a way that enables organizations to make strategic changes to their campaigns to enrich the customer experience.
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Understanding the Difference Between Various Customer Data Solutions
One may question the relevance of customer data platforms when other tools such as Customer Relationship Management (CRM) or Data Management Platforms (DMP) are readily available in the market. An important distinction, however, is that while CRM and DMP have limited usage and capabilities, CDP provides a unified and persistent database, providing transparency at the individual customer level. The CDP tool stitches together information not only from known but also from unknown or external sources.
Despite being different solutions, CDPs, DMPs, and CRM solutions are often confused with each other. A Customer Data Platform is designed to enable comprehensive and personalized marketing. It collects and unifies first-party data from multiple sources to create a holistic view of every customer to help marketers create personalized marketing campaigns. A Data Management Platform is designed to support web display advertisements, gathering its data from cookies. The data collected and aggregated by DMP is anonymized and retained for a period of 90 days. A DMP cannot be used to create a personalized experience for an end-user. A Customer Relationship Management platform is a product specially designed to manage interactions and relations with customers and prospects.
A CDP works best with other marketing technologies by piggybacking on existing DMPs and CRM solutions. Marketers can be more responsive to their customers and tap into new channels to carefully curate programs that can boost revenue and increase customer retention.
Benefits of Customer Data Platforms
By bringing together structured, unstructured, online, and offline data together, CDP creates a centralized view that goes a long way in enhancing customer experience. By integrating data from every customer touch-point such as email, social media, in-store transactions, or existing data in the internal systems, a constantly updated and 360-degree view of the customer is generated.
A Holistic View of the Customer
By merging data from different silos, organizations get a unique identifier or customer profile, making it easier to target the right audience in the right way. Data consolidated by the CDP tool becomes the single source of truth for analytics and reporting of customer behavior. CDPs create a unified report, tracking the end-to-end performance of a customer's journey within the brand.
Democratization of Data
Customer data is invaluable for any organization to drive business. Marketing, business intelligence, and customer relations are all heavily dependent on the availability of customer data. A CDP tool democratizes access to data across all departments to easily leverage data and develop customer touch-points. Different departments have the same view of customer activities, which increases transparency and maintains consistency in messages while integrating customer engagement.
Speed, Agility and Flexibility
Since customer behavior constantly evolves with emerging technology, CDP is a perfect tool for organizations to build and connect ever-changing consumer behavior with flexible technology trends. CDP allows businesses to collate data from everywhere and use it anywhere to drive sales and revenue growth. It enables smooth orchestration of data delivery journeys across multiple channels.
Enhanced Customer Experience
The number of channels to reach existing and potential customers are at an all-time high, as is the customer expectation. With CDP in place, a complete view of the customer behavior can be viewed to drive customer experience without any blind spots. Businesses can precisely target individual customers with personalized messages that will cement relations and improve retention rates. This has a significant impact on revenue as well, both in terms of spending efficiency and sales growth.
Operational Efficiency
Integration of point solutions with emerging technologies can be resource-intensive and often unreliable. In such cases, custom solutions can also be hard to maintain. The centralizing action of CDP can save hours spent on integrating data silos and applying business rules. As CDPs collate data directly from multiple data points, it offers higher accuracy of data than other sources, making marketing campaigns more efficient, effective, and unified. Audience and business rules are set up centrally in one place and applied across various tools, eliminating duplication of efforts.
Automation and Multichannel Marketing Activation
CDPs, without a doubt, are huge data hubs but they are also capable of activating data through AI and automation. Simply put, with CDP, a marketer can anticipate a buyer's next purchase based on their history as marketers can reach the right audience with the right message through the appropriate channel. This ensures that the allocated budget is utilized for campaigns that yield high results. Predicting the future may seem like a hyperbole, but when used right, CDPs are a great tool for predicting future marketing trends. By relating different groups of data to predict customer behavior, CDP can churn out segments of high-quality audiences. With real-time analysis, businesses can make strategic changes to stay ahead of the competition.
Automated Dash-boarding and Pipeline
Once a Customer Data Platform collects data, the next step is to process it to create a reliable and streamlined data pipeline. Cleaning, preparation, and transformation are done to perform data matching and identity resolution to identify particular customer records. Frameworks, templates, and pipelines are created for processing data to unify and duplicate records.
Data Protection and Privacy
With the advent of data privacy and protection laws, it has become important to respect the customer's privacy now more than ever. It is not only about compliance anymore. Customer Data Platforms limit the amount of data being collected from the customer. You only collect data that is vital to your marketing strategy. The General Data Protection Regulation (GDPR) classifies each company based on how customer data is collected. Once this classification is understood, CDP can assist in managing customer data.
How a Customized CDP Compares to Off-the-Rack CDP Products
Off-the-shelf CDPs are usually black box solutions, i.e, the end-user is not aware of the internal workings of the system. Custom CDPs overcome this challenge and increase transparency for customers. It gives a complete understanding of the solution built for them. Additionally, off-the-shelf solutions may come with features unnecessary for the user, yet they have to be paid for. Another common issue with off-the-rack CDP is that it often doesn’t include all the data. Custom CDP can ingest data from all platforms by creating custom connectors.
The flexibility of Quantiphi’s custom-built CDP is such that it can be customized to suit any sector, whether retail, employment, or healthcare. For instance, a recruitment agency can customize Quantiphi’s CDP solution to get an end-to-end holistic view of their candidates and effectively filter those best suited for their client's needs. A medical facility can use a custom CDP tool to create a comprehensive medical history of a patient using records from within or outside their system. One is only limited by their imagination when it comes to custom CDP solutions.
As customer journey becomes complex, marketers need to up their game by adopting comprehensive solutions to overcome challenges. In today’s economic scenario, unless an organization develops a deeper understanding of its customer, it is going to fall behind in the race. Aggregating data present across various platforms to derive meaningful insights becomes less of a challenge for marketers with Customer Data Platforms.
Technology is at everyone’s disposal, yet leveraging it is a task for many. Democratization of available solutions remains a huge challenge. Quantiphi, an AI-first digital engineering company, has made efforts to address this gap through its custom CDP solutions. CDPs are complex software solutions, which, when used right, can give deep insights into customers' behavior and preferences. This knowledge will help businesses improve their marketing efforts, sales, and even products. Our differentiated solutions across sectors enable our customers to be better prepared for the rapidly evolving customer behavior and technology trends. Reach out to our experts to learn more about Quantiphi’s abilities to curate custom CDP tools to improve marketing capabilities and drive business growth.
