What Is a Customer Data Platform (CDP)?
A CDP is a software that creates a unified customer database that is accessible to other systems. The CDP centralizes customer data from different platforms and sources and then shares the data with other systems for marketing campaigns, customer service, and all customer experience initiatives. Through solutions such as the Redpoint Digital Acquisition Platform powered by LiveRamp, marketers can activate and match activity from downstream ad platforms and networks back to a CDP, giving them control over the customization of a customer journey across digital touchpoints.
Customer Data Platform Capabilities to Look For
Customer Data Platform Capability: Flexibility
Customer journeys change and evolve. For example, customer journeys have become far more complex; curbside pick-up, digital returns and online comparison shopping are some of the newer behaviors that must be accounted for in customer journeys. Consumers are continuing to take more control over their journeys and expect a seamless experience across channels. Consumers also expect brands to recognize them across channels and customize interactions so they are relevant to where they are in a customer journey.
A CDP must now help guide comprehensive, multi-channel, multi-touch journeys to meet the ever changing needs and expectations of customers. One customer data platform capability you must prioritize is flexibility so the CDP will evolve with your customers on their buying journeys. It should be able to provide an accurate, real-time customer profile to drive decisions across multiple channels at the cadence of the customer.
Customer Data Platform Capability: Compliance
GDPR, CCPA, and LGPD. Every marketer is well aware of data privacy laws enacted all over the globe. It is critical to avoid missteps when engaging with potential and current customers, no one wants to end up the subject of heavy fines or penalties.
While a CDP is not intended to be the go-to compliance platform, one customer data platform capability enables brands to implement and control the necessary compliance processes on behalf of its customers. In the case of an unsubscribed customer, as an example, the CDP recognizes that certain information like purchase history must be maintained for returns or warranties and will not completely delete all customer data.
Customer Data Platform Capability: Future-Proof Technology
The third-party cookie data is a big factor in driving the CDP marketplace and it is putting a premium on the importance of the accurate collection and unification of first-party customer data, accurate identity resolution and comprehensive data quality.
If easy access to unified customer data is the baseline requirement and expectation for a CDP, the growing importance of first-party data raises the bar for what a unified profile must look like. The need for perfect data and complete transparency become essential. Marketers can no longer tolerate imperfect or outdated records, or accept half measures for resolving an issue of a customer’s identity regardless of device, channel or other variables.
Perfect data is a common thread among the external forces that, together, shape the direction of the CDP marketplace. Growing complexity in digital-first customer journeys, rising expectations for a seamless customer experience, an increase in data privacy laws and the disappearance of the third-party cookie all make it essential that brands work with perfect customer profiles.
Privacy laws and data regulations will continue to change over time so choose a CDP that can capture the information you need now and into the future.
Customer Data Platform Capability: Perfection
- Perfect Data: Perfect data is the ultimate necessity to deliver superior customer experiences. CDP buyers should delve further into vendor claims about the features and functionalities of their specific products. Data collection, data prep and identity resolution represent baseline expectations. Within those categories there is a broad spectrum of competencies. Ask how the vendor achieves ‘data resolution’:
- Is it using both heuristic and probabilistic matching?
- Is it solving for any device or ID, householding?
- Perfect Next-Best Action: A perfect next-best action requires a real-time component to enable the business to operate at the cadence of the customer. Engaging with the right customer at the wrong time or on the wrong channel can damage the customer relationship. Prospective buyers need to ensure that a CDP is capable of real-time decisions that meet the requirements of the business, whatever that definition of real time may be for specific business use cases.
Many players in the CDP market are rushing to meet the demands for perfect data. Customers’ online shopping and buying behaviours change, data privacy policies evolve, and cookie data is becoming a thing of the past. CDP solutions are offering new bells and whistles to their products to appeal to marketers looking to crack the code on personalized customer buying journeys. These rapidly released features and functionalities that promise unified customer profiles should be met with skepticism. Marketers should look past the surface to make sure a CDP satisfies their ambitions for the future, in ways that will deliver tangible ROI. Redpoint’s solutions provide a scalable, unified single point of control where all customer data is connected to form a golden record and every customer touchpoint is intelligently orchestrated. Visit our website to learn more.