Customer Data Platforms are the new shiny toys in town. Evolved marketers are obviously setting up the baselines for what this new technology can enable for them and are clear about what differentiates CDPs from the other tools in their stack. In recent times though, you might have often come across Marketing automation platforms calling themselves as Customer data platforms or CDPs, often with a formal rebranding exercise. While this might have left some Marketers confused, we continued to receive questions around what makes CDPs unique, and hence thought of sharing with you via our blog a list of major differences between these two platforms and the possible synergies between these two platforms.
Before we dive deep, let us quickly understand what is a Marketing Automation Platform.
Marketing Automation platform is a tool used by Marketer to reach out to prospects repetitively through single or multiple channels. Traditionally, the Marketing Automation platform was mainly used to drive email & SMS campaigns however in recent times they have included other channels in campaigns like website notifications and banners, mobile app notifications and push content, social media posting and ads, among others.
On the other hand, Customer data platforms provide a suite of tools that help Marketers take control of their Customer Experience as well as Data & Insights, while full stack CDPs are capable of even replacing traditional Marketing Automation systems.
Data Ingestion – CDPs master the art of making complex and intertwined data communication systems into an automated and seamless data stream. Due to which it brings together the online and offline sources of customer interaction, structured as well as unstructured form of interaction and known as well as anonymous type of customer interaction into a single interface.
Identity Building – With data ingested, CDPs create a unique and unified customer ID that is persistent over time. The single view of a customer that is anchored in the unique customer ID is designed to help marketers spot customers and respond with a relevant personalized experience. A Single Customer View is the foundation of an omnichannel strategy and customer journey orchestration.
Activation – Also known as the process of applying data insights in further Customer Interactions, CDPs like FirstHive have efficient Journey Orchestration capabilities along with advanced segmentation. It enables marketers to engage with their customers in moments via the real time messaging capabilities. With its ML algorithm, FirstHive also has the capability to arrive at preferred time, preferred channel can content affinity score for every customer.
Here are some important questions that every marketer should ask themselves before they sign up with a traditional Marketing automation tool calling themselves as a CDP.
- Does the system consider unstructured data like voice or image?
- Does the system trigger a message real time in the customer journey?
- Does the system trigger a message basis content affinity?
- Does the system enable personalization or customization in an anonymous state?
Marketing automation platforms can serve very well to run repetitive campaigns through single or multi channels, as they are known to reduce tedious manual tasks but is that what your requirement is confined to? As stated by Forrester Analyst Joe Stanhope “Marketing Is All About Moments; Don’t Wait For Them, Create Them”
Thus think twice before you settle for Marketing Automation Platform or even believe them when they state that they offer CDP.
You definitely don’t want to get into a state where your customer is interacting with the brand in an anonymous state, and there is a fear that the prospect campaign is run trying to sell them stuff which the customer has already bought, thereby leading to unnecessarily targeting and waste of your marketing dollars.
CDP helps marketers acquire, engage and retain their customers. Especially full stack Customer data platforms like FirstHive use their ML algorithm to help enterprise ingest every customer interaction, process the interaction in a meaningful way and then create a Single Customer View so that marketers drive relevant engagement in an optimized manner. Needless to say, this results in increase in marketing ROI as the conversion rate increases with relevant communication.
In our opinion there are about 6 differences between these two platforms that you should be aware of….
- Golden Records
- Data Prowess
- Use Cases
- Flexibility to innovate
- Data Privacy
Let’s look at each one of them in detail:
Purpose: As the name suggests, Marketing automation platform saves you from running campaigns in a repetitive manner via single or multi channel while CDP acts like a ML based processing system that helps enterprises get a Single View of all customer interaction in one place.
Customer Golden Record: A simple way to put this would be, CDP with its data ingestion and unification capabilities can help you identify the true golden records while Marketing Automation is confined to just the interaction data against structured data available in CRM.
Data Prowess: While Marketing automation tools absorb structured data from CRM, they miss out on unstructured and anonymous data. Yet again, CDP saves your day with its multiple data connectors to ingest all kinds of data, be it unstructured or anonymous data, using ML.
Use cases: Be ready to be perplexed with the long list of benefits a CDP can provide V/s Marketing automation Platform. A Marketing automation platform can only serve one core purpose of designing & executing campaigns while CDP use cases are listed below:
- Collection of customer interaction data – As mentioned earlier in this blog, CDP has unique capabilities of ingestion customer interaction in any form and further processing that data using AI or ML.
- Privacy Compliant access to Golden customer records – CDP like FirstHive are privacy by design. The platform complies with all regulations applicable in each operating country. Be it GDPR, CCPA or PDPC, with FirstHive, marketers needn’t worry about compliance regulations.
- Targeted customer campaigns based on segmentation – CDPs allow marketers to create advanced segmentation and deploy journeys unique to that segment there ensuring relevant engagement instead of a common journey applied to every customer.
- Increase in conversion rates using customization and Personalization – CDPs allow marketers to drive customized as well as personalized engagement even in anonymous state and across different channels.
- Engaging with customers in moments – CDPs like FirstHive are known for enabling real time messaging thereby letting enterprise practice Moments based Marketing.
Flexibility to innovate: With CDP, marketers are exposed to intelligence that they were not exposed to earlier and that often triggers innovations which CDP companies are happy to build on as a part of product enhancement. This is rarely seen in Marketing Automation.
Privacy: Since CDPs ingest all types of Customer Data and not just structured interaction data, the compliance cover is much larger than what a Marketing Automation Platform offers. In fact, CDP is the only platform that can enable the enterprise to be 100% compliant.
Wondering what to do with your existing marketing automation tool?
When most of us marketers are trying to reduce the data silos, marketing automation tools are just adding up to the silos. If you are already using a marketing automation tool with ‘n’ number of other marketing tools, be prepared to find yourself surprised to find out that a CDP can ingest data from all your connectors including your marketing automation tool, and function as a central processing system for all connectors which will help you unify all your data from various sources.
You can now start making sense out of all your campaigns.
Reach out for a free demo to learn more as to how a CDP and Marketing automation tool can co-exist to add value to your brand.