Are Customer Data Platforms an Engagement Silver Bullet?May 16, 2018
The modern customer can appear in any channel at any time. Because consumers can show up anywhere, brands need to have a presence everywhere. More than that, this always-on brand presence needs to be consistent so the customer receives the same experience no matter where they engage.
Many brands have failed to deliver the necessary consistency in their customer experience. Not from a lack of ability, but because they face substantial challenges to achieving their goals. These take the shape of organizational roadblocks from internal departments who are loathe to cede any “turf,” and technical barriers arising from the organic growth of marketing technology stacks – and resulting data silos – over the past three decades.
Customer data platforms (CDPs) arose to counteract the technology fragmentation that prevents brands from fully understanding their customers’ needs, behaviors, preferences, and intents. CDPs are a new type of operational data environment that ingests an enterprise’s data from all sources and provides an always-on, always updating golden record that is continually available at low latency to all touchpoints and users across the enterprise.
With the rise of CDPs came the inevitable idea that the platform could solve all the problems facing customer engagement professionals. In doing so, deploying a CDP would simplify engaging the omnichannel consumer and allow brands to meet customers where they are with contextually relevant messaging. But is this true?
How a Customer Data Platform Works
Customer engagement technology stacks have evolved organically over the past three decades, with brands adding new point solutions in reaction to consumer trends. Brands adopted email marketing solutions in droves in the 1990s, and social media management platforms went through a similar upsurge in popularity in the early 2000s.
Each of these new point solutions collected and stored data differently, including using distinct identifiers and varying levels of structure. Because the underlying data structures are different, these solutions tend to not “talk” to each other or share data. The lack of interoperability in legacy point solutions means brands risk sending the same message to the same person through different channels. If this happens enough times, consumers are apt to switch to a competitor who can better understand the relevant context.
A customer data platform eliminates that problem. CDPs are designed to unify customer data of varying sizes, types, and cadences through a combination of processing rules and analytics to craft a single, composite view of the customer and operationalize it. Customer data platform users gain visibility into the entire interaction history of a customer across all their point solutions, which means that they can see when a customer interacted via social media alongside their response to a recent email, etc.
More importantly, customer data platforms function as a single point of data control, empowering business users with the ability to directly access and act on customer data in the moment of need. This can be transformative, enabling business units to react with the next best offer at the speed of the customer.
Customer Data Platforms Can’t Do It All
At its core, a customer data platform operationalizes the insight that brands collect on their customers. By operationalizing customer data, business users can deliver contextually relevant messaging at the moment of need – meeting customer expectations for a personalized experience. The brands that successfully personalize their marketing stand to benefit from an $800 billion revenue shift over the next five years, according to Boston Consulting Group, which will accrue to the top 15 percent of companies.
Providing a centralized window into all that is knowable about customers and operationalizing it is only the first step. To truly make the CDP valuable, it needs to be tied into an intelligent orchestration engine that enables you to act on your unified data and deliver contextually aware messaging to the right customer at the right time through the right touchpoint. The intelligent orchestration engine, which we call a customer engagement hub (CEH), leverages the single view of the customer created within a CDP to deliver on customer expectations. The ability of a customer engagement hub to deliver contextual interactions to customers is powerful, especially given that Frost & Sullivan recently found that companies lose $300 billion annually from poor customer experience.
The Customer Engagement Silver Bullet?
So, are CDPs the “silver bullet” that marketers have waited for? In a marketplace facing digital disruption, which McKinsey predicted has already shaved 45 percent off incumbents’ revenue and 35 percent off their pre-tax earnings, it is imperative that you demolish the barriers keeping data captive in functional and channel-specific silos to survive and thrive.
But deploying a CDP alone will not be enough. You need intelligent orchestration capabilities to make the unified customer profile actionable and deliver relevant messaging to consumers in the moment of need. Without the ability to act on the unified data, then you miss the opportunity to deliver relevant interactions to your increasingly omnichannel customer base. CDPs may not be a silver bullet for customer engagement, but they are certainly a vital piece of your brand’s success.