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What is the purpose of a Customer Data Platform (CDP)?

What is the purpose of a Customer Data Platform (CDP)?

Companies are increasingly implementing a Customer Data Platform (CDP) to help organize and facilitate the use of data, a major issue in today’s business and at the heart of an organization´s customer relations. A CDP allows the centralization, unification, and storage of all types of data around customer profiles. The data can thus be independently used by various departments in the company, for marketing, sales, or analysis purposes. We will take a closer look at the uses of a Customer Data Platform.

Definition of a CDP

The Customer Data Platform (CDP) is defined by Gartner as follows: “A CDP is a marketing technology that unifies customer data from both marketing sources and all other channels to help build customer profiles and optimize the schedule and targeting of messages and offers. “

The first objective of a CDP is to centralize the data and unify it around customer profiles. However, the CDP is not a simple database; it does not simply store the data, but also organizes it. The CDP gives coherence to the mass of customer data by organizing it around individual customer profiles. This way, the data can be leveraged and better exploited by marketing.

The final objective of a CDP is to enrich marketing (and therefore customer relations) to improve the segmentation and customization of loyalty programs, marketing campaigns, promotional offers, messages, or even web content.

To summarize, CDPs integrate all the customer data from various channels (online and offline) and organize it around their profiles. This organized data is then redistributed throughout the various activation tools: CRM, DMP, emailing software, marketing automation tools, etc.

How does a CDP do all this? CDPs will break down the silos between different departments by bringing together all the transactional, relational, or behavioral data collected through the company’s various channels, in a 360° customer vision. To retrieve all types of data (B2C, B2B…), the CDP must be able to connect with different online, offline, and on-chain solutions, whether in real-time or not, and all this via different technologies (API connectors, Ipaas…). A CDP tool must be able to facilitate the identity definition to unify all customer data and also create customer views that can be used by business teams. Finally, the CDP must also archive customer knowledge to facilitate access and distribution to other tools.

What is the purpose of a CDP?

CDPs are designed for usage in the marketing department, unlike other data management systems whose configuration and maintenance require a lot of back and forth between the marketing and the

IT department. This is one of the main advantages of a CDP: IT technicians will only be involved in setting up the platform, and then the marketing teams will be able to operate independently. The CDP makes it easy for people in the marketing department who do not necessarily have IT skills to use the data.

The use of a CDP / CDP Functions

The Customer Data Platform makes the information available to both business teams and their tools (ERP, CRM, business intelligence, marketing automation, etc.) for various uses.

The unification of data is particularly important to provide a unified view and to avoid creating duplicates along with their implications. With a CDP, situations such as the following can be avoided: the consumer has just purchased an item on an e-commerce website and the retail department contacts him a few days later to offer him to buy it in-store for less. Such type of situation, created by a lack of unification in customer data, discredits the brands.

Here are some other examples of frequent scenarios that can be facilitated with the use of a CDP:

  • Creation of reliable reports and dashboards: thanks to consolidated, structured, and standardized data, marketing and sales teams can better manage and adjust their actions.
  • Data Privacy Administration: the CDP integrates sensitive data protection requirements so that the DPO can access and manage data in accordance with the regulations.
  • Data Quality Management: Data quality is important for a solid and effective data management strategy. CDP allows you to normalize the data by performing calculations, conversions, or processing the required information as needed: this way, the data is clean, which facilitates targeting, message personalization, reconciliation, etc.
  • Setting up a loyalty program: CDP simplifies the setting up of a loyalty program, which is a complex process when you don’t have such a tool. Thanks to its unified customer views, CDP allows you to set up RFM scores (recency, frequency, amount) in order to classify customers and set up the criteria that would give the right to a reward. For example, customers who share their passion for the brand on social networks could receive a voucher. As a reminder, RFM scores can be used for simple classifications of customers, such as identifying customers at-risk or high-potential customers.

Why set up a CDP?

Most often, a company will set up a CDP to build a UCR (Unique Customer Repository), a data hub, a datamart, a data warehouse, etc. A CDP can also be set up to meet a specific purpose such as:

  • Visualize all the interactions between the contact and the brand via a 360° customer view
  • Create reports and dashboards to optimize marketing and sales activities
  • Facilitate the implementation of loyalty and acquisition strategies through personalization and recommendation
  • Feed machine learning, artificial intelligence, or calculus engines
  • Centralize the management of an omnichannel marketing pressure
  • Centralize the management of the privacy policy, as well as the compliance of its associated rights (anonymization, right to be forgotten…)

Scal-e, more than a CDP

The Scal-e platform offers more than a CDP, being a complete solution with all these features naturally embedded, plus other complementary features. Scal-e aims to act as a marketing hub which helps brands reduce their acquisition and retention costs. The platform breaks down the silos between data, tools, and business needs in order to complement the existing IT service.

Moreover, Scal-e has the advantage of creating custom data models in order to fit the customer’s environment (facilitator role), whilst other tools will impose a data model, which results in projects long, complex, and often unsuitable.

Scal-e is  RealCDPTM   certified, which means that an audit has determined that it fulfills all the functions that users expect from a CDP. Scal-e can do the following:

  • Integrate data from any source
  • Capture all the details of the integrated data
  • Store the data indefinitely (subject to privacy constraints)
  • Create unified profiles of identified individuals
  • Share data with systems that need it
  • Respond in real-time to new data and profile requests
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