Customer data platforms meet three critical “must-haves” for marketers—cloud, speed, and anticipation
Customer data platforms (CDPs) meet three urgent needs for marketers to champion a OneOffice mindset. The cloud-based platforms can handle the pandemic-accelerated trend to work from anywhere, they feed customer acquisition platforms accurate and real-time data, and they anticipate customers’ needs and behaviors.
In a time of rapidly changing customer behavior, the length of the lag in an enterprise’s response to change is the difference between growth and decline in 2021. In addition to improvements in data speed, the ever-improving capabilities in predictive analytics and AI empower ambitious businesses to anticipate their customers’ needs and behaviors before their customers are even aware of them.
Alongside the current and real urgency—wise marketers (initially in B2C, but increasingly in B2B) have seen them as a smart application of digital technology to restore the customer relationships that mass production and mass media broke. They hold the key to enabling OneOffice organizations to know who they serve. When your customer is no longer walking through your door, that digital knowledge is more business-critical than ever.
If you can’t structure the data, you are missing out on up to 8x ROI
Customers always were individuals. One size never did fit all. When you have the data and technology to do better, the only reason you wouldn’t is that you didn’t know you could work with rapidly updated segments-of-one at scale. Customer data platforms make that possible—anywhere and everywhere—at speed. They bring together and structure customer data across a range of touchpoints to support the practical application of other platforms and deliver on marketing ambitions.
Typical benefits include improved margins, larger basket sizes, improved retention, more repeat purchases, and reduced campaign operating costs. For example, Amperty (Amazon’s CDP) reports 20% daily efficiency gains when applied across multiple brands in the US for the Moet-Hennessey portfolio. Tealium Audience Stream reports it delivered 6x ROI within six months of deployment for Roman Originals through a better understanding of customer journeys and better customer data integrity. Eight times ROI over three years is not unheard of.
By making smart connections between the data points they collect, CDPs generate individual, centralized customer profiles—a single customer view.
They differ from data management platforms (DMPs) in that while DMPs operate in the realm of anonymized data, CDPs—building on their CRM traditions—combine old-world Rolodex-style data (personal identifiers such as email address, name, and street address) with digital customer interaction data (such as cookies and IP addresses).
OneOffice success is built on insight-rich, real-time data
As a named concept, “customer data platforms” have only been with us since 2013. The ambition to build a single customer view (SCV) that collects everything we know about a particular customer into one file has been driving software development since the earliest days of CRM.
CDPs emerged as software, building on the SCV databases’ power and drawing from web analytics and knowledge and content management tagging platforms. Enterprises used them to target customers with digital ad campaigns, personalized offers, and next best actions.
Today, the best have the opportunity to claim a place in the HFS OneOffice Emerging Tech Platform. As integration-enabling cloud-based systems of record, most will find their natural home among OneOffice applications (see Exhibit 1), placing individually optimized customer experience at the heart of how enterprises create value. They solve the know-your-customer problem and play a crucial part in the information model.
If you don’t understand the individual customer, how can you respond to their evolving needs? This insight-rich and real-time source of behavioral data becomes foundational.
Exhibit 1: Emerging tech enables the “OneOffice Organization.” Data drives the information model.
Ever-improving rapid cycles of learning will expand the gap between the first-movers and the also-rans
Today’s CDPs, such as MParticle, Tealium AudienceStream, and Amazon’s Amperty, aim to simplify customer data infrastructure through secure APIs to maintain data quality, ensure governance, and deliver enhanced customer experience.
CDPs provide the data and track customer interactions, which, in combination with systems of intelligence, will provide the anticipatory insights and forecasts an increasingly responsive OneOffice enterprise thrives on.
Another CDP, Blueshift, assists and complements human marketers applying AI to enhance decision making by informing marketers of new opportunities to engage, predicting how individual customers may respond to omnichannel activity, and automating marketing activity from within the same platform.
In combination with other elements of the OneOffice Emerging Tech stack, other CDP examples, such as Exponea, illustrate how CDPs can extend into marketing-focused workflow and process automation with an ambition to become the single solution for acquisition, conversion, and retention. Machine learning is applied to optimize predictive recommendations, supporting people and process with insights.
A CDP is the perfect partner for pandemic economies—and for what comes next
When your customer stops walking through your door, your only route to customer knowledge becomes digital. You can easily integrate CDPs with existing systems to collate and source individualized data to maintain and build individualized relationships.
Of course, this helps the enterprise succeed during a lock-down. When no one wants to linger longer than required to make any ”real-world” transaction, customers are happy to wander the web, mooch around your websites, and chew over their planned purchases on social media. CDPs take advantage of our shift to digital and pull the resulting data together to match it with what we already know about an individual or to start creating a profile of a customer-to-be.
Provided you treat that customer with respect during communication and every interaction, you can both make a sale and gather data to inform an ever-improving model of what that customer and customers like them want from you.
The first step is to listen to your customer—CDP enables that. The next is to respond—systems of intelligence can support that.
But technology cannot fix mindset. The winners will be those that appreciate the customer’s role in the organization is central and one in which the customer shares their data with you as a partner in improving their experience.
The Bottom Line: CDP is a must-have for any serious marketer in 2021.
The pandemic-powered shift to digital places a new premium on customer knowledge, and, with increasing use of machine learning and AI to deliver anticipatory insights, CDPs offer enterprises a route to tracking and responding to rapidly changing customer needs. Forget quarterly planning for wide and vague segments of customers; your CDP-equipped competitors are building a personalized digital rapport with individuals you will find increasingly expensive to catch up with.