Customer Data Platform: Defining The Edges of The Customer Puzzle
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Some puzzle enthusiasts love working without a picture to guide them, feeling out where each piece should go and working from the outside in. However, it’s clear how much easier the task is when you have a bird's eye view of what you’re building.
Dealing with customers is the same. Without the right tools, you’re essentially trying to piece together a customer puzzle without ever seeing the whole picture. Customer Data Platforms (CDPs) provide marketers with a 360-degree view of their customers, allowing them to quickly identify key insights that would otherwise remain hidden in disparate silos of data.
Getting a full understanding of CDPs will give any team an edge in putting together the puzzle of their customers. If you want to stay on top of digital transformation in 2023, and gain a competitive edge in the marketplace, you’ll need to know a thing or two about these powerful platforms.
Understanding Customer Data Platforms
Customer Data Platforms are a type of software that collects, unifies and organizes data from multiple sources into one unified profile. This allows marketers to analyze customer behavior across their entire customer journey, helping them gain insights into who their customers are and how they interact with the brand.
It does this by collecting data from customer surveys, website visits, purchase history and social media interactions. This unified view of the customer helps marketers segment customers based on shared characteristics, enabling them to better target their marketing efforts and understand how they can best serve each individual.
CDPs also enable companies to create personalized experiences for each individual customer by leveraging artificial intelligence (AI) capabilities like natural language processing and machine learning algorithms.
For example, if a business knows that one of its customers is more likely to purchase items when offered free shipping or discounts on certain products, it can use the data from the CDP to create targeted offers or discounts for that customer.
Customer Data Platform vs Customer Relationship Management
It may be tempting to see CDP as an extension of Customer Relationship Management (CRM). However, there are several distinctions between the two.
Management vs. Data Collection - While CRM is focused on managing customer relationships, CDPs are more focused on collecting and leveraging data to create personalized experiences for customers.
Scope - CRMs focus on one customer at a time and don’t include a look at commonalities between clients. CDPs help identify clients who are similar to one another in order to craft campaigns that target them.
Data Sources - CRMs rely on data from one source, usually an online store. CDPs draw from multiple sources to get a full picture of the customer's habits.
While CRM is more limited, when combined with a robust Customer Data Platform, it's possible to create a powerful customer engagement strategy.
Benefits of A CDP
Being able to see a full picture of your customers is essential to a successful business. With the help of a CDP, you will be able to achieve
Insightful Analytics - a better understanding of your customer base is vital to your success. A CDP can provide you with insights into customer behaviors, preferences and trends, allowing you to craft campaigns that are tailored specifically to them.
Personalization - You’ll be able to create a personalized experience for each customer by leveraging the data collected from multiple sources. This will result in more engagement and loyalty among your customers.
Efficiency - By having all of your customer data in one place, it's easier to access information quickly. This is key to implementing data-driven decision-making.
Fewer Data Silos - Data silos cause a lot of problems, as they can limit your ability to see the full picture. A CDP eliminates this problem by bringing all of your data together in one place.
Data Protection and Privacy - With a CDP, you can ensure that the data you’re collecting is secure and compliant with GDPR regulations.
Customer Lifetime Value - CDPs help you understand the lifetime value of your customers, so you can focus on nurturing existing relationships instead of constantly needing to chase new ones.
This view of your clients allows you to put the pieces together and see the strongest way forward.
Customer Data Platform Best Practices
If you haven't worked on many puzzles, the finished picture might not be enough to get you started. Beyond finding some side pieces and trying to logic your way through the colors, it's easy to get lost.
CDPs take some time to get used to as well, especially with the sheer amount of data that they deal with. Here are some tips to help you get a handle on your customer base.
Tip One: Data Hygiene
Without accurate data, your picture is going to be too flawed to offer much help. You need to invest the time and resources it takes to keep your data clean and up-to-date. This means removing duplicates and ensuring that the customer information you have is correct.
Tip Two: Connecting Data Sources
Once you have your data organized, it's time to connect all the pieces of the puzzle together. This is where bringing another program like a CRP platform can be helpful.
By integrating the two, you can make sure all your customer information is in one place and easy to access.
Tip Three: Segment Your Customers
Too much data is just as unhelpful as no data at all. CRPs shine in their ability to identify similar groups of customers, giving your team insights into their wants and needs.
It's a great way to identify potential areas of growth or opportunities where you can increase sales.
Tip Four: Visualize Data
In order to fully engage with data-driven decision-making, you need to make the data accessible and understandable to your entire team. CRPs can be a huge help to your marketing team, customer service team, and innovation experts.
Using a central program for data-first collaboration like Stormboard allows everyone to engage with the data that is coming in and work together to create a better user experience.
The Bottom Line
Customer needs and wants can feel like unconnected puzzle pieces, especially if you don’t have a process in place for starting to put them together. With a Customer Data Platform, you and your team can get a look at the full picture.
If you understand this picture, and have the right tools to get it in your team’s hands, there’s no end to the creative and powerful strategies you’ll be able to implement.
Stormboard can be leveraged to reduce meetings, improve outcomes, track projects, and act as a central database for the storage and evolution of all your best ideas and concepts.
About the author:
A programmer by trade, Nick Saraev is a freelance writer and entrepreneur with a penchant for helping people excel in their careers. He's been featured on Popular Mechanics & Apple News, and has founded several successful companies in e-commerce, marketing, and artificial intelligence. When he's not working on his latest project, you can find him hiking or painting.
