Knowledge of the customer continues to be a priority for most businesses. In fact Gartner’s latest CMO study reveals that two thirds of marketing budgets goes towards supporting customer retention and growth.
It is no surprise, therefore, that over the past few years customer data platforms (CDP) have been extolled by consultancies and clients alike as the panacea of the customer experience.
A CDP is defined as a platform that empowers customers to orchestrate their data and respond to changing consumer behaviours in the moment, rather than focusing solely on static campaign management. It has three major criteria: identity resolution, analytics and data activation.
Due to the rise in popularity of CDPs there are a plethora of solutions but many only cover off one or two of the three criteria, including tag management companies, mobile app vendors and personalisation tool providers.
Cloud-based CDPs are the next generation and are offering greater flexibility in the market than ever before. It means that enterprise-wide solutions no longer have to be all-or-nothing. It is possible for businesses to tailor their stack and create a best of breed solution based on their own individual requirements now and in the future.
This is one of the most important benefits of cloud based platforms; functionality can be added quickly and easily meaning CDPs can scale up (or down) to suit the needs of the business and its customer data. There is nothing more frustrating than being told that an existing CDP can’t handle additional data from a new system coming online. Additionally, cloud-based solutions are squeezing the costs, meaning that it has never been more affordable for businesses to invest in an agile and secure CDP or migrate from an old legacy system.
Cloud-based CDPs are finally living up to the hype and are enabling businesses to answer business critical questions such as: Will this customer churn? What is their purchase intent? What is their current and predicted value? What are their preferences? Will they buy if I send them an offer? Legally can I send them an offer? – and all in real-time.
Following the introduction of GDPR and the importance of getting data-driven marketing right, the fact that CDP 2.0 is set to become a reality in 2019 can only be a boost for marketers.
David Gurney is chief executive of Alchemetrics