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Why you should care about customer data platforms

As modern customers, we expect consistent communication, relevant and personalised content recommendations, and smooth interactions from brands and organisations – across all channels. I mean, how hard can it be? Pretty damn hard, actually. Luckily, there exists something called a customer data platform or CDP. These nifty tools have become virtually indispensable for any company who wants to keep up in today’s high-stakes environment. And you’re about to learn all about them.

The basics of creating great customer experiences are well known by now:

  1. Collect customer information across all your touchpoints.
  2. Gain actionable insights.
  3. Profit.

That all sounds pretty doable when you’re the village baker. But any decently-sized SME or international enterprise will tell you that things can get pretty complex pretty fast. Sky-high customer expectations, rapidly advancing technologies, and ever-stricter privacy regulations make the much-coveted 360-customer view challenging to obtain for anyone. And if you’re working at an international company with numerous departments and various data taxonomies and methodologies? Then you’re truly f… labbergasted.

Data-driven decision making

Enter the CDP: a software application that gathers customer data from multiple internal and external sources – product usage, transaction history, behavioral data, point-of-sale data, etc. – and makes it accessible to other systems and applications. The CDP recognises when data is related to the same customer, and creates a single profile for each. It also performs predictive analytics and often includes artificial intelligence and machine learning in its feature set. The resulting insights can then be used as a basis for decision making, e.g. in marketing campaigns.

Data can be obtained at various touch points in the sales funnel, but what you need exactly will depend on the use case. Since third-party cookies have fallen from grace, many companies are developing a first-party customer data strategy, i.e. convincing prospects to hand over their personal information willingly. In addition to personal information, you could also factor in external data for a more complete picture – e.g. current trends, the weather, location, etc.

CDPs are booming business

And they will be a for a while: market research organisation MMR projects that the market size for CDPs will grow from 3.5 billion USD in 2021 to 34.7 in 2029.

There are a lot of players on the market, including some well-known names like Microsoft, Salesforce, Oracle, and SAP. But smaller challengers have emerged as well, including Lytics, Tealium, mParticle, Bloomreach, and countless others. All of these have their own strengths and weaknesses. Tealium, Twilio Segment and Bloomreach CDPs, for example, are standalone, while Salesforce, Oracle, SAP, Microsoft and Adobe offer CRM- or data management-based versions.

CDPs we like at MultiMinds

  • Tealium: With its powerful and unique CDP and tag management solutions, Tealium reconciles the paradox of ‘privacy personalisation’. Standout features: simple data collection, guaranteed data quality, industry-leading integration marketplace, and a privacy-first mindset.
  • Adobe Real-Time CDP: Part of Adobe Experience Cloud, Adobe Real-Time CDP offers a wide range of advanced data management capabilities. Use it to aggregate data into fully-fledged, real-time profiles that can be triggered across all channels.
  • Lytics: The easy-to-use Lytics CDP enables marketing teams to create personal customer experiences across multiple channels, using first-party data and machine learning. Actionable user profiles help marketeers segment audiences based on interests and behaviours, and present relevant offers.
  • Twilio Segment CDP: A modern customer data foundation that enables precise personalisation. Some of Segment’s stand-out features are a dedicated Privacy Portal and Customer AI integration, which couples the power of LLM’s with real-time customer data.

MM toolkit

Getting your CDP on

Getting started with a CDP can be challenging both financially and technologically (you can read all about that here). What’s even more important for long-term CDP success, however, is ensuring that you know in advance what you want from it. In other words: you need a use case that makes sense for your specific situation.

A couple of typical use cases include:

  • building customer segments
  • suppressing current users from receiving irrelevant ads
  • setting up cross-channel campaigns
  • sending e-mails at the optimal time for each customer (engage time optimisation)
  • proposing content based on a customer’s real-time location data
  • predicting churn
  • predicting the future value of a customer
  • offering pre-emptive customer support

Need help figuring out which use case(s) make sense for your organisation? Book a use case ideation workshop with one of our experts.

New kid in town: CDPaaS

Setting up a CDP use case doesn’t happen overnight. In fact, it can take up to 2 years with a traditional CDP to see some results. Add to that the high license fee and considerable deployment investment, and you’ll understand why many organisations scrutinise every detail before they decide which CDP they’ll implement, and what they’ll use it for.

But did you know there’s another way? At MultiMinds, we’ve built our own subscription-based CDP: CDP as a Service. This full-service solution is perfect for marketeers who are tired of being held back by financial, technical and other concerns, and just want to start generating value from their data.