What CDP (Customer Data Platform) is and Its Key Benefits

Businesses these days are awash in more files and data than before.

This means there is demographic, transactional data, and a virtually amount of behavioral data. Add everything up, and you will have data from known customer purchases and anonymous ad impressions to customer service and product usage.

Basically, customer data is the superset of all these together. This data can be stored in silos, whether technological or organizational, making it more difficult for businesses to provide a consistent experience to customers across different consumer devices and channels.

The Basics

These days, customers simply conclude that your business remembers and knows who they’re and what they need every time and across many channels.

Marketing technologists and marketers understand that collecting and acting upon unified details of customers is not simple. As a matter of fact, just several businesses have attained complete integration. Others are just battling with staff skills, organizations, budgets, technology, and strategies to succeed.

However, customers don’t care or know about these challenges. If you fail to meet all their expectations, they may assume that you are not concerned about their welfare and take their business elsewhere.

Whether those other businesses will offer them a good experience or not, it won’t matter. Once you lose them, you will need to fight twice as hard to have them back.

So, What Is CDP?

CDP (Customer Data Platform) refers to a piece of software that combines data from many tools so as to establish one centralized customer data having interactions with your products and data on every touchpoint.

You can then segment that database in a couple of ways to develop more personalized marketing campaigns.

How It Works

The work of CDP is to gather a lot of data about customers, create individuals or unified profiles of those clients, and deliver personalized as well as effective communication across all channels.

With the right information, algorithms, and baselines, marketers may extend the audience and match this new group to their perfect clients.

Marketers may continue building that foundation, look for more prospective clients, and grow the reach of their advertising campaigns.

This helps to empower business teams so as to ensure customer engagement is impactful and relevant while reducing the burden on data analytics experts. This can be achieved in the following ways:

  • Customer experience
  • Customer intelligence
  • Customer 360

Types of CDPs

According to the expert’s guide for CDP, there are several types, including Marketing Data Integration and SmartHub CDPs. Marketing Data Integration is a data operation platform that allows granular data governance with a marketer-friendly interface while analytics happen in other platforms.

In contrast, SmartHub CDPs serve as tools that emphasize personalization and marketing orchestration for planned and event-triggered journeys or campaigns. Apart from Marketing Data Integration and SmartHub CDPs, other types you need to know include:

  • CDP Engines and Toolkits
  • Marketing Cloud CDPs


Every customer data is well organized and readily available for use. Some resources are needed to maintain and set up the CDP, though it doesn’t need a high level of technical skills compared to traditional data warehouses.

Data organized and collected with CDPs is also visualized through personalized data profiles for every user. Since every customer data is located in a single central location, it is important to have a 360-degree view of customers.

How CDP Differs from Other Solutions

The key difference between CDPs and other solutions is that CDPs allow flexibility of data structures and pairing of the unknown as well as known contact behavior.

CDPs normally gather information from known members of your audience and anonymous details from newcomers so as to give insights about everyone accessing your business.

Other platforms have the same functionality as that of CDPs, though their primary goals are somehow different and can prove helpful, based on the stage you are in and the type of business you have.

For instance, DMPs (Data Management Platforms) alone can’t give you sustainable competitive advantages over all your competitors. However, just adding a personal identifier will not give DMPs flexible storage data and advanced identity matching.

This means it is difficult for a DMP to match the full functionality of CDP.

Management of Customer Data

Data collection and maintenance is the core function of CDP customer data management. Every CDP offers an important database, which integrates and collects identifiable customer information across the business. However, from there, CDPs differ in the capabilities to handle the following:

  • Unstructured/structured data
  • Data hygiene
  • Offline/online data
  • Identity resolution
  • Data ingestion capabilities

Marketing’s Future and CDPs

After the Covid-19 outbreak, businesses have been improving their game like never before by investing in digital marketing strategies so as to survive and adapt.

In order to meet emerging and new demands, experts like Scott Brinker advises businesses to put more focus on humanizing, decentralizing, centralizing, and automating everything they do and embrace a continuous change while at it.

This is when CDP should come in, especially if this seems like a complicated feat. CDPs are ready and primed to sift through customer details, mold them into personalized campaigns, and provide clients with an experience that truly resonates.

With personalization processes and digital marketing accelerating rapidly, there is no better time to embrace CDPs.

Key Benefits

CDPs may enhance your relationship with customers, improve your business, and complement your current marketing efforts and software.

In addition, CDPs can help to avoid data silos. Basically, data silos refer to the information available in a single department, though it is isolated from the rest of the business.

They happen when a business scales too quickly to share data sufficiently or when technology is unable to keep up with it.

Data silos are not healthy for businesses as they slow productivity, threaten the accuracy of customer profile data, and develop a less collaborative environment.

The good news is that CDPs may help your business prevent data silos. By unifying your employees and customer data, you can be confident that your data will be accessible and accurate.

The Takeaway!

The global pandemic, Covid-19, has served to facilitate digital transformations and refocus their attention on customers. Although marketing budgets were either reduced or paused in the early days of the pandemic, most businesses have prioritized and reinvested the digital experienced as they came to realize that CDP is an important piece to improve the digital experience.

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