Thursday, June 6, 2019

What is a Customer Data Platform?

A Customer Data Platform (CDP) is a system that collects and stores all your customer data, for analysis and use by marketers. A CDP makes it easier for marketers to build and execute targeted, data-driven strategies.

A key function of a Customer Data Platform is to unify fragmented customer data within business silos. For example, CRM, mobile, transactional, website, email and third party data. This data then undergoes a Single Customer View process, which matches, merges and de-duplicates the data. The result is a 'Single Source of Truth', for consistent treatment by marketing across all channels.

customer data platform (CDP) is a type of packaged software which creates a persistent, unified customer database that is accessible to other systems. Data is pulled from multiple sources, cleaned and combined to create a single customer profile. This structured data is then made available to other marketing systems.[1] According to Gartner, customer data platforms have evolved from a variety of mature markets, "including multichannel campaign management, tag management and data integration."[2]
The CDP market is currently a $300 million industry and projected to reach $1 billion by 2019.

In addition, some CDPs provide additional functions such as marketing performance measurement analytics, predictive modeling, and content marketing.
Commonalities across CDPs:
  • marketer-managed;
  • unified, persistent, single database for customer behavioral, profile and other data, from any internal or external source;
  • consistent identifier that links all of a customer's data;
  • accessible by external systems and structured to support marketers' needs for campaign management, marketing analyses and business intelligence;[4]
  • provide a 360-degree view of the customer; and
  • allow users the capability to predict the optimum next move with a customer.[5]
Data Management Platform (DMP) collects anonymous web and digital data. CDPs collect data that is tied to an identifiable individual. Users of CDP can leverage the intelligence to provide more personalized content and delivery.
data warehouse or data lake collects data, usually from the same source and with the same structure of information. While this information can be manually synthesized, neither type of system delivers the identity resolution needed to build a consolidated single customer view. Data warehouses are often updated at scheduled intervals whereas CDPs ingest and make available data in real time. In practice, most CDPs use the same technologies as data lakes; the difference is the CDP has built-in features to do additional processing to make the data usable, while a data lake may not.

Marketing automation systems[edit]

A CDP is fundamentally different in design and function when compared with marketing automation systems, though CDPs provide some of the functionality of marketing systems and customer engagement platforms. CDP tools are designed to talk to other systems. They retain details from other systems that the engagement or automation tool does not. This is valuable for trend analysis, predictive analytics, and recommendations that can leverage historical data.[6]

CDP vs DMP[edit]

Main differences between a customer data platforms (CDP) vs. data management platforms (DMP):[5]
Customer data managementManage an individual customer with a single profile.Manage segments of customers with anonymous profiles.
Data sourcesWork with both anonymous data (Cookie, device IDs and IP address) and known individual data (e.g. names, addresses, email, phone).Work mainly with anonymous data (cookies, device IDs and IP addresses).
Data unification methodsUse sophisticated cleansing and matching algorithms to provide high-quality unified customer profiles.Use deterministic key matching to track customers and build anonymous profiles across digital channels.
Data updatesContinuously processes batch and streaming data to keep profiles up to date and accurate.Updates customer profiles via batch process every one or two days.
Data maintenanceMaintains customer golden records that persist over time.Maintains an anonymous customer record for a short period of time.
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CDP is just a new DMP but cooler for marketing and improve ROI for business

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