Why Customer Data Is Important
Today’s customers simply assume that your company knows – and remembers – who they are, what they’ve done, and what they want, at all times and across all channels. Marketers and marketing technologists know that gathering and acting on unified customer information isn’t easy. In fact, just a few companies have actually achieved complete integration. The rest are battling with technology, strategy, budgets, organizations, staff skills, and other obstacles to success.
But customers don’t know or care about those challenges. If you don’t meet their expectations, they’ll assume you don’t care about them and take their business to somebody else they believe will treat them better. Whether those other firms will really give them a better experience almost doesn’t matter: once you’ve lost them, you’ll have to fight twice as hard to get them back.
No wonder so many marketers have made a unified customer experience their highest priority.
Why Customer Data Platforms
A unified customer experience is impossible without unified customer data. Most data originates in separate systems that weren’t designed to share it with anything else. Traditional methods for collecting that data into unified customer profiles, such as an enterprise data warehouse, have failed to solve the problem. Newer approaches, like “data lakes”, have collected the data but failed to organize it effectively.
The Customer Data Platform is an alternative approach that has had great success at pioneering companies. A CDP puts marketing in direct control of the data unification project, helping to ensure it is focused directly on marketing requirements. CDPs apply specialized technologies and pre-built processes that are tailored precisely to meet marketing data needs. This allows a faster, more efficient solution than general purpose technologies that try to solve many problems at once.
Customer Data Platform Definition
“A Customer Data Platform is packaged software that creates a persistent, unified customer database that is accessible to other systems”.
This definition has three critical elements:
– “packaged software“: the CDP is a prebuilt system that is configured to meet the needs of each client. Some technical resources will be required to set up and maintain the CDP, but it does not require the level of technical skill of a typical data warehouse project. This reduces the time, cost, and risk and gives business users more control over the system, even though they may still need some technical assistance.
– “creates a persistent, unified customer database“: the CDP creates a comprehensive view of each customer by capturing data from multiple systems, linking information related to the same customer, and storing the information to track behavior over time. The CDP contains personal identifiers used to target marketing messages and track individual-level marketing results.
– “accessible to other systems“: data stored in the CDP can be used by other systems for analysis and to manage customer interactions.