Customer data platforms are increasingly important as a driving force in business decision-making and also for customer-to-customer marketing. Still, in the modern world of digital data, there is less interest in it — or simply no interest — from business leaders.
That’s the main conclusion from the new study published by the International Data Corporation (IDC). Its findings are based on the views of more than 1,100 large and small businesses, executives, and thought leaders from a range of industries.
As a result, organizations must transform their marketing and sales strategies to include CDP marketing as an additional tool in their process.
For example, it’s a great way to segment customer events in a way that results in more
So rather than marketing to individual customers in a massive, spray and pray way, it is time to develop a single-channel strategy that can be integrated across business units, regions, and geographies.
Customer data represents a significant differentiator for businesses looking to differentiate their offerings and position themselves effectively. It can demonstrate how a company can go beyond its traditional marketing with an extended focus. This data provides insights to inform business strategies and marketing tactics.
What is essential to understand is user data much more than what anonymous customers tell the people in marketing in their surveys.
Prospective user data is also comprised of an assortment of non-customer data, such as
There are significant opportunities to leverage anonymous users' data, but many businesses have yet to develop an effective data strategy to capitalize on its potential.
Despite its potential, many organizations may not have the right technology to harness the full strength of first-party, third-party, and behavioral user data. Without a solid combination of proper technology, tools, and data, organizations can be blind in their process and fail to deliver desired ROI on marketing activities.
CPDs that support anonymous user data exchange help companies improve customer interactions with their brands. They focus on making data more useful for businesses and the personalized customer experiences by collecting and disseminating their valuable data.
As a result, the following are the key attributes of the customer platform to help them distinguish their services.
1. Data aggregation
Most CDPs gather their data from sources as they become available, and they publish their data in the formats required. For example, a CDP database aggregating data from its user behavior to sell advertising space in its clients' websites can publish data formats like XML or JSON. If the data changes, the customer platform should automatically detect and react to changes with their customer-facing applications.
To make data more useful, CDPs need to summarize their original data with a helpful structure, like adding categories or adding attributes. CDP data use one or more summarization algorithms to structure the user information, add additional attributes like tags, and make data more valuable.
Most companies want to share this data with in-house analytics teams because they are interested in knowing as much about their user journey as possible. A CDP platform can organize this information in formats like JSON, CSV or publish it quickly to the data science into target Data Lake or warehouse. For example, a CDP data platform can aggregate data from its CPDs software with product details in its database and publish them to a warehouse in BigQuery so that the Data Analytics team can create a dashboard in Data Studio
2. Data Filtering and transformation
Another essential feature of cdp database is the ability to filter and transform data. It is a big problem when you start your data collection and aggregation activities to collect everything.
After that, you will reach the understanding that you need just a fraction of that information. You don't need a constant flow of triggers each time a user visited the pricing page.
Also, not all data formats are perfect, or aggregation is not enough for you to answer an important question. Then data transformation will take place and make from numbers dates, from numbers with a few decimal points, just straight numbers, etc.
Working with first-party data is more tricky than with 3rd party data. You need to create logic from each customer interaction and make a clear sense for your sales team in their Customer Relationship Management system or unified customer database.
3. Data Distribution
Data Integrations was the first race each CDP data platform entered. To deliver the value, you should collect all sales and marketing interactions and be able to distribute that data to deliver personalized experiences across other platforms.
CDP is one of the most cost-effective solutions for that problem cause it aggregate and transforms all the data from multiple sources into one unified format for all its users to all developed platforms. As a result, one team of Data Engineers can serve an unlimited number of paying users in their Extract, Transform, and Load (ETL) needs.
As always, there is no best-fits-all solution. Each CDP has a different market, target buyer, and set of sources to collect data from and send.
Also, different pricing models are ranging from high fix cost or billing based on data usage.
The most popular platform to have a look at is Segment.com
They have very friendly pricing to start (you can test the platform for free using two sources and sending data to any place). At a 100$ per month price, you can extract and send data from any location to any destination!
Unfortunately, it is still a product in the enterprise category, so if you want to move to data filtering or persona feature, you should expect yearly pricing at the start at $20.000 per year for basic functionality.
Other exciting options on the market are
Each of them has a different product stage focusing on other consumers. For example, Insider has a considerable focus on the B2C marketer's segment giving an exciting overview of each consumer from his buying habits. Bloomreach is very similar to that sense emerging with a recent round of acquisitions. SAP customer data platform is a good addition to SAP universe suite of products.
While Zaius was recently acquired by Optimizely and brought customer behavior intelligence for the SMB sector, similar to segment.com, it has enterprise product offerings.
Consumer data platforms (CDPs) aim to make visitors share their valuable information with businesses for better service. When CPDs were first introduced, most of them were designed to provide the following services based on the needs and demands of companies:
Very similar to the features each CDP has :)
Collecting, processing, and storing user data problems are solved via multiple connectors each vendor has.
Data Transformation and summarization are done with filters and transformation functions (usually hidden under a high price tag).
They are distributing data among multiple sources. That solution category is growing even faster cause CDP frequently is the core data warehouse for marketing teams, and they push their vendor to develop and connect to target CDP. As a result, at-scale data platforms cut the time to market using customer loyalty.
An essential aspect of a CDP is that it provides a necessary connection between every element to make up your digital experience. As this platform expands, each piece extends beyond the functionality it is there to provide by introducing an additional layer of functionality to complete that seamless digital experience.
One of the essential components of CDP’s benefits is that it facilitates data sharing among companies and customer data hubs. Thus it leads to two significant benefits, which are:
1. Ability to track any amounts of customer accounts and their preferences in real-time.
2. Track any entire customer journey based on any criteria.
Let’s start with the first benefit.
There are different use cases in CDP. Some of the most common are:
1. Log analysis
One everyday use case of CDP is tracking events or occurrences across the website, product, or social media platforms. Thus, companies like Netflix or Spotify often use CDP to track their users. Once they know how many likes and dislikes a particular movie or music, they can analyze this data to understand where improvements or changes can be made to their platform for better services.
2. Market research
Along with event tracking, one of the most common use cases is generating and aggregating users' data regarding their preferences. That is why companies like Amazon use CDP for Market research. To find the best way for a particular category or offer in this specific area, they use aggregated data from their customer base. Therefore, analyzing user details, including data about their preferences or interests, helps Amazon to understand preferences and give that information to users, which means they can shop for the best and most effective products from the marketplace.
3. Advertising or Promo
Again, e-commerce platforms like Amazon use CDP to generate data for marketing purposes, which helps them create personalized recommendations for people based on their interests and needs.
4. Data Visualisation
CDPs help users gain essential insights by making it easy to analyze and visualize your data. By providing the necessary tools for users to explore data, they can make better decisions.
By developing this central platform, the app will give your visitors a different experience to use your platform as quickly as possible when visiting other parts of the web experience.
If you’re building a modern, scalable, and secure online consumer engagement portal, your Consumer data platforms software must be ready to scale with the growth you expect and the traffic you are likely to receive. As a result, data integration, content management, and mobile app development become critical.
CDPs offer a wide range of benefits to these types of projects, and there are many different types of approaches you can take for developing an ideal one for you.
User data has already been the cornerstone of marketing, marketing automation, and advertising. But before those platforms began to expand their reach and power, the most critical function of user data was to be able to answer two questions:
Data on one user’s accounts alone was never enough to have a high level of predictive power. The additional data flows on users from CS platforms, CRMs, messaging apps, phone call systems give a correct view of what is going on.
It doesn't matter if it was about revenue attribution or sales or campaign performance. The ability to predict what one marketing activity has the most impact on the overall revenue of multiple accounts across many platforms was a goldmine that was never really tapped or discovered.
The only question was, How do you get there?
Why are CDPs the way they are?
“In a worldwide conversation around consumer data, we typically only talk about data for business-to-business and business-to-consumer marketers, but that doesn’t speak to what’s happening on the other end of the consumer.” ~Chris Dixon
With the proliferation of data, customer management platform is becoming more of a “platform”: a means of delivering all the data collected in one centralized location, in one place. This simplifies, but not eliminates, the complexities inherent in collecting data and making it actionable for marketing operations—allowing brands to make better strategic and tactical decisions based upon the data. However, it also makes it much more dangerous.
Consequently, most CPDs have enterprise-level security implemented to protect all collected data and successfully sell their products to large companies.
Customer data products generally range from $10,000 to $200,000 and will increase over time. In most cases, these data products come with ongoing costs.
When building your analytics team, you'll have to assess your current cost structure and compare these costs to what they will be over your five to seven-year ownership period, which ranges from three to ten years.
While you may have spent $10,000 on your Business Intelligence project, the business may start to struggle due to the sudden increase of traffic by new visits. You could be forced to invest another $10,000 or more to ensure you will not begin to lose new incoming data (most CDPs price product by number of unique website visitors/users).
In general, how much a real-time Customer Data Platform will cost depends on your level of expertise and knowledge and the size of your company.
Customer management platform usually provides the following two main functionality benefits:
1. Visitors data analysis
Most of a data platform's functions are designed to help organizations better understand their audience needs and their most profitable products and services.
When choosing a database for customer 360 view, an analyst should be able to:
The more diverse analytics you need, the more products and add-ons a particular vendor will suggest accomplishing your goals.
2. Customer segmentation
By segmenting your users' data into categories, you'll be able to create various reports that can help your organization make a better product or user experience.
As a result, many platforms have products like "Persona" from Segment to aggregate and label custom cohorts of users with different customer engagement habits.
A customer data platform Gartner can unify a company’s customer data from marketing and other channels to enable customer modeling and optimize the timing and targeting of messages and offers.
It is where real-time user interaction data is stored and can be easily activated on other customer engagement platforms.
1. Data aggregation
2. Data Filtering and transformation
3. Data Distribution
1. Log analysis
2. Market research
3. Advertising or Promo
4. Data Visualisation
For full-time usage of CDP with monthly traffic of more than 10.000 visitors, you should consider pricing to start from $20.000 per year. With a moderate amount of features, the price will quickly go up to $50.000-$100.000 per year.
Customer data platforms are increasingly important as a driving force in business decision-making and also for customer-to-customer marketing. Still, in the modern world of digital data, there is less interest in it — or simply no interest — from business leaders.
That’s the main conclusion from the new study published by the International Data Corporation (IDC). Its findings are based on the views of more than 1,100 large and small businesses, executives, and thought leaders from a range of industries.
As a result, organizations must transform their marketing and sales strategies to include CDP marketing as an additional tool in their process.
For example, it’s a great way to segment customer events in a way that results in more
So rather than marketing to individual customers in a massive, spray and pray way, it is time to develop a single-channel strategy that can be integrated across business units, regions, and geographies.
Customer data represents a significant differentiator for businesses looking to differentiate their offerings and position themselves effectively. It can demonstrate how a company can go beyond its traditional marketing with an extended focus. This data provides insights to inform business strategies and marketing tactics.
What is essential to understand is user data much more than what anonymous customers tell the people in marketing in their surveys.
Prospective user data is also comprised of an assortment of non-customer data, such as
There are significant opportunities to leverage anonymous users' data, but many businesses have yet to develop an effective data strategy to capitalize on its potential.
Despite its potential, many organizations may not have the right technology to harness the full strength of first-party, third-party, and behavioral user data. Without a solid combination of proper technology, tools, and data, organizations can be blind in their process and fail to deliver desired ROI on marketing activities.
CPDs that support anonymous user data exchange help companies improve customer interactions with their brands. They focus on making data more useful for businesses and the personalized customer experiences by collecting and disseminating their valuable data.
As a result, the following are the key attributes of the customer platform to help them distinguish their services.
1. Data aggregation
Most CDPs gather their data from sources as they become available, and they publish their data in the formats required. For example, a CDP database aggregating data from its user behavior to sell advertising space in its clients' websites can publish data formats like XML or JSON. If the data changes, the customer platform should automatically detect and react to changes with their customer-facing applications.
To make data more useful, CDPs need to summarize their original data with a helpful structure, like adding categories or adding attributes. CDP data use one or more summarization algorithms to structure the user information, add additional attributes like tags, and make data more valuable.
Most companies want to share this data with in-house analytics teams because they are interested in knowing as much about their user journey as possible. A CDP platform can organize this information in formats like JSON, CSV or publish it quickly to the data science into target Data Lake or warehouse. For example, a CDP data platform can aggregate data from its CPDs software with product details in its database and publish them to a warehouse in BigQuery so that the Data Analytics team can create a dashboard in Data Studio
2. Data Filtering and transformation
Another essential feature of cdp database is the ability to filter and transform data. It is a big problem when you start your data collection and aggregation activities to collect everything.
After that, you will reach the understanding that you need just a fraction of that information. You don't need a constant flow of triggers each time a user visited the pricing page.
Also, not all data formats are perfect, or aggregation is not enough for you to answer an important question. Then data transformation will take place and make from numbers dates, from numbers with a few decimal points, just straight numbers, etc.
Working with first-party data is more tricky than with 3rd party data. You need to create logic from each customer interaction and make a clear sense for your sales team in their Customer Relationship Management system or unified customer database.
3. Data Distribution
Data Integrations was the first race each CDP data platform entered. To deliver the value, you should collect all sales and marketing interactions and be able to distribute that data to deliver personalized experiences across other platforms.
CDP is one of the most cost-effective solutions for that problem cause it aggregate and transforms all the data from multiple sources into one unified format for all its users to all developed platforms. As a result, one team of Data Engineers can serve an unlimited number of paying users in their Extract, Transform, and Load (ETL) needs.
As always, there is no best-fits-all solution. Each CDP has a different market, target buyer, and set of sources to collect data from and send.
Also, different pricing models are ranging from high fix cost or billing based on data usage.
The most popular platform to have a look at is Segment.com
They have very friendly pricing to start (you can test the platform for free using two sources and sending data to any place). At a 100$ per month price, you can extract and send data from any location to any destination!
Unfortunately, it is still a product in the enterprise category, so if you want to move to data filtering or persona feature, you should expect yearly pricing at the start at $20.000 per year for basic functionality.
Other exciting options on the market are
Each of them has a different product stage focusing on other consumers. For example, Insider has a considerable focus on the B2C marketer's segment giving an exciting overview of each consumer from his buying habits. Bloomreach is very similar to that sense emerging with a recent round of acquisitions. SAP customer data platform is a good addition to SAP universe suite of products.
While Zaius was recently acquired by Optimizely and brought customer behavior intelligence for the SMB sector, similar to segment.com, it has enterprise product offerings.
Consumer data platforms (CDPs) aim to make visitors share their valuable information with businesses for better service. When CPDs were first introduced, most of them were designed to provide the following services based on the needs and demands of companies:
Very similar to the features each CDP has :)
Collecting, processing, and storing user data problems are solved via multiple connectors each vendor has.
Data Transformation and summarization are done with filters and transformation functions (usually hidden under a high price tag).
They are distributing data among multiple sources. That solution category is growing even faster cause CDP frequently is the core data warehouse for marketing teams, and they push their vendor to develop and connect to target CDP. As a result, at-scale data platforms cut the time to market using customer loyalty.
An essential aspect of a CDP is that it provides a necessary connection between every element to make up your digital experience. As this platform expands, each piece extends beyond the functionality it is there to provide by introducing an additional layer of functionality to complete that seamless digital experience.
One of the essential components of CDP’s benefits is that it facilitates data sharing among companies and customer data hubs. Thus it leads to two significant benefits, which are:
1. Ability to track any amounts of customer accounts and their preferences in real-time.
2. Track any entire customer journey based on any criteria.
Let’s start with the first benefit.
There are different use cases in CDP. Some of the most common are:
1. Log analysis
One everyday use case of CDP is tracking events or occurrences across the website, product, or social media platforms. Thus, companies like Netflix or Spotify often use CDP to track their users. Once they know how many likes and dislikes a particular movie or music, they can analyze this data to understand where improvements or changes can be made to their platform for better services.
2. Market research
Along with event tracking, one of the most common use cases is generating and aggregating users' data regarding their preferences. That is why companies like Amazon use CDP for Market research. To find the best way for a particular category or offer in this specific area, they use aggregated data from their customer base. Therefore, analyzing user details, including data about their preferences or interests, helps Amazon to understand preferences and give that information to users, which means they can shop for the best and most effective products from the marketplace.
3. Advertising or Promo
Again, e-commerce platforms like Amazon use CDP to generate data for marketing purposes, which helps them create personalized recommendations for people based on their interests and needs.
4. Data Visualisation
CDPs help users gain essential insights by making it easy to analyze and visualize your data. By providing the necessary tools for users to explore data, they can make better decisions.
By developing this central platform, the app will give your visitors a different experience to use your platform as quickly as possible when visiting other parts of the web experience.
If you’re building a modern, scalable, and secure online consumer engagement portal, your Consumer data platforms software must be ready to scale with the growth you expect and the traffic you are likely to receive. As a result, data integration, content management, and mobile app development become critical.
CDPs offer a wide range of benefits to these types of projects, and there are many different types of approaches you can take for developing an ideal one for you.
User data has already been the cornerstone of marketing, marketing automation, and advertising. But before those platforms began to expand their reach and power, the most critical function of user data was to be able to answer two questions:
Data on one user’s accounts alone was never enough to have a high level of predictive power. The additional data flows on users from CS platforms, CRMs, messaging apps, phone call systems give a correct view of what is going on.
It doesn't matter if it was about revenue attribution or sales or campaign performance. The ability to predict what one marketing activity has the most impact on the overall revenue of multiple accounts across many platforms was a goldmine that was never really tapped or discovered.
The only question was, How do you get there?
Why are CDPs the way they are?
“In a worldwide conversation around consumer data, we typically only talk about data for business-to-business and business-to-consumer marketers, but that doesn’t speak to what’s happening on the other end of the consumer.” ~Chris Dixon
With the proliferation of data, customer management platform is becoming more of a “platform”: a means of delivering all the data collected in one centralized location, in one place. This simplifies, but not eliminates, the complexities inherent in collecting data and making it actionable for marketing operations—allowing brands to make better strategic and tactical decisions based upon the data. However, it also makes it much more dangerous.
Consequently, most CPDs have enterprise-level security implemented to protect all collected data and successfully sell their products to large companies.
Customer data products generally range from $10,000 to $200,000 and will increase over time. In most cases, these data products come with ongoing costs.
When building your analytics team, you'll have to assess your current cost structure and compare these costs to what they will be over your five to seven-year ownership period, which ranges from three to ten years.
While you may have spent $10,000 on your Business Intelligence project, the business may start to struggle due to the sudden increase of traffic by new visits. You could be forced to invest another $10,000 or more to ensure you will not begin to lose new incoming data (most CDPs price product by number of unique website visitors/users).
In general, how much a real-time Customer Data Platform will cost depends on your level of expertise and knowledge and the size of your company.
Customer management platform usually provides the following two main functionality benefits:
1. Visitors data analysis
Most of a data platform's functions are designed to help organizations better understand their audience needs and their most profitable products and services.
When choosing a database for customer 360 view, an analyst should be able to:
The more diverse analytics you need, the more products and add-ons a particular vendor will suggest accomplishing your goals.
2. Customer segmentation
By segmenting your users' data into categories, you'll be able to create various reports that can help your organization make a better product or user experience.
As a result, many platforms have products like "Persona" from Segment to aggregate and label custom cohorts of users with different customer engagement habits.
A customer data platform Gartner can unify a company’s customer data from marketing and other channels to enable customer modeling and optimize the timing and targeting of messages and offers.
It is where real-time user interaction data is stored and can be easily activated on other customer engagement platforms.
1. Data aggregation
2. Data Filtering and transformation
3. Data Distribution
1. Log analysis
2. Market research
3. Advertising or Promo
4. Data Visualisation
For full-time usage of CDP with monthly traffic of more than 10.000 visitors, you should consider pricing to start from $20.000 per year. With a moderate amount of features, the price will quickly go up to $50.000-$100.000 per year.
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