Gathering customer data has never been more critical and while nowadays we have more tools than ever, there are still some challenges ahead.
From social media and web analytics to email and mobile apps, marketing teams must keep track of all the touchpoints customers interact with. Then, all that data needs to be stored in one place while ensuring everyone in the company can access it and then use it to inform business decisions and drive growth. And that's just scratching the surface!
Indeed, every year more and more data-tracking tools are created. So much so that it's estimated that by 2025 463 exabytes of data will be created each day globally –the equivalent of 212,765,957 DVDs per day!
Understanding Customer Data Platforms for marketing.
A Customer Data Platform (CDP) is a marketing software platform that helps companies collect, unify, segment, personalize, and activate customer data across multiple channels. It’s an essential tool that marketing, sales and product teams use to understand their customers in order to deliver better experiences to them.
They have become a must-have for any marketer using big data to deliver smarter marketing. As a matter of fact, the CDP market is on the rise and expected to continue growing. Over $1.8 billion in venture capital has been invested in this type of marketing software platform over the past two years alone, proving that CDPs are here to stay. Indeed, every day, more and more companies realize the value of investing in them.
You sense their impact across the industry, from large-scale brands, to emerging startups trying to dig a niche in the market: Customer data platforms for marketing are helping marketers make sense of all the customer data they have access to.
The benefits of a Customer Data Platform.
Before we get into the details, let’s take a look at the big picture to understand why exactly CDPs have become so necessary. In general terms, they take the strain off marketing teams responsible for managing customer data from scratch.
Manual data management is highly detrimental to productivity and increases the probability of introducing human mistakes into your databases. In fact, it's such a prevalent problem that it ranked #1 in a 2021 Adverity survey about marketing challenges, cited by 41% of the survey respondents.
CDPs solve the problem of manual data management by being one integrated tool to get started on a journey towards making data-driven decisions. Knowing this, let’s dive into 5 specific benefits of a Customer Data Platform for CMOs and marketing teams.
1. Monitoring social and tech trends within your customer base.
One of the main functions of a CMO is monitoring the social and tech environment to get a better understanding of the brand’s place in the market and how they can adjust to better fit into it. One of the benefits of a Customer Data Platform, especially those with artificial intelligence and machine learning capabilities, is that it allows CMOs to process massive amounts of data to identify trends, spot patterns, and offer options moving forward.
With this knowledge, they can provide actionable campaign suggestions based on patterns such as the traits valuable customers have in common and determining how close customers are to buying or looking for alternatives in other brands. This way, this type of marketing software platform gives you a holistic view of your entire database. For any individual customer, you can see every marketing campaign related to them, across every department.
This “eye in the sky” also makes it easier for marketers to see how the team is interacting with customers on an individual level, as well as collaborate across departments in ways that were impossible until recently. In this regard, Khoros CMO, Katherine Calvert, says: “Meeting your customers where they are is step one. Equipping your team to learn from those customer interactions —across the entire journey— is where the magic happens. If a product tweak causes confusion or frustration, you need to know about it —fast.”
Key takeaway: As a whole, Customer Data Platforms for marketing provide the means to understand the trends and patterns that drive your customer base and provide options for using this data to improve CX and keep them satisfied.
2. Allowing the CMO to contribute to relevant data governance policies.
Data governance policies determine how the brand will manage the availability, usability, integrity, and security of the data within the enterprise systems. To this end, certain Customer Data Platforms come with quality assurance and data governance features that will help you protect your data and use it efficiently. Here are some of the functions that a marketing software platform can provide for CMOs trying to plan out consistent data governance strategies:
- Define and enable data usage policies.
- Apply labels to data according to the usage policies that are relevant to it.
- Configure specific marketing actions for external destinations, like ad platforms, CRMs, analytics, and marketing automation platforms.
- Deploy policies to enforce data usage compliance and receive notifications for violations.
- Comply with GDPR and other data privacy regulations.
Key takeaway: Multiple CDPs provide free trials that allow you to understand how they work and what features they provide. Experimenting with them to determine which one offers the best functionality for your data governance needs is key to finding the right platform for each brand.
3. Painting a complete picture of the customer journey.
Coordinating the modern customer journey is particularly challenging because of the many touchpoints spread across more channels than ever. Among the many benefits of a Customer Data Platform is the fact that they help marketing specialists paint a complete picture of the customer journey by bringing together behavioral, transactional and identity data.
In this aspect, Treasure Data's CMO, Tom Treanor, thinks that “customer journey maps help you move beyond surface-level assumptions about your customers and toward the heart of what drives their purchase behaviors”. Once the customer’s roadmap is determined, you can analyze customer interactions throughout the entire journey and deliver the appropriate messaging through the channels the customer prefers.
Key takeaway: You can quickly develop a deep understanding of your customers beyond the basic demographic information, helping you understand how each of your customers behaves across channels to create highly personalized experiences for each of them.
4. Providing a wealth of data to communicate with partners, management, investors, and employees.
Above all, Customer Data Platforms are coherent data managers that provide aggregated information for digestion and deep analysis. This wealth of data proves invaluable when communicating strategies to employees, investors, partners, and other executives and stakeholders.
Key takeaway: Whether providing essential insights into your customer base or communicating strategies with investors and employees, this type of software marketing platform will allow you to back up your claims and justify the implementation of specific policies.
5. A single source of truth for all teams.
The benefits of a Customer Data Platform go way beyond than just gathering data. In IT-related fields, a "single source of truth" is the practice of aggregating the data from many systems within an organization to a single location. CDPs act as the single source of truth since they are made to aggregate data from multiple sources. In general, there are many benefits to single sources of truth, such as:
- No duplicate data entries or version control issues.
- Timely data values at the right moment.
- Less time spent validating records.
- No more data silos.
- Improved communication and productivity in the entire organization.
But how do these benefits translate to marketing data, exactly? A marketing software platform like lets you capture customer data when using your brand’s products or services. Regardless of the department they contact or the channel they use, a CDP will add all of this data into a unified profile.
Key takeaway: Once the CDP is in place, every department can access this data with their own tools and develop contextual strategies fueled by high-quality data.
CMOs need to take advantage of as many tools as the current market demands, and Customer Data Platforms for marketing have emerged as one of the most important ones to help you take control of all customer data and make the most out of it. As the amount of data collected continues to grow and more businesses adopt complex tech solutions such as automation and AI implementations, the importance of this type of marketing software platform will continue to grow.
It would be wise of CMOs to progressively gain the necessary skills to understand how they work and learn how to use the insights they provide to develop more innovative, efficient marketing strategies.
No matter how you look at it, CDPs have become an essential piece in the marketer toolkit, one that will shape how strategies are created and implemented on a global scale.
At Conexio, we transform data from every touchpoint into relationship-building insights, cost optimization opportunities, attribution models, and much more. In other words, we help brands reap the amazing benefits of a Customer Data Platform. So, if you’re ready to invest in a world-class Customer Data Platform (or optimize the one you have!), don’t hesitate to reach out to our experts.
This article is part of a series on Customer Data Platforms for marketing and their benefits to your brand. If you are interested in learning more about them, check out the rest of the series:
- Customer Data Platforms: Your go-to solution to customer data challenges.
- Making the most out of marketing data: benefits, challenges, and how to solve them.
- How CDPs help you deploy better marketing campaigns.