Do I need a Customer Data Platform?

Do I Need a Customer Data Platform?
A customer data platform (CDP) is a marketing database that combines disparate customer data from marketing and other sources. 

A CDP is designed to store information that can be used to identify customer or purchasing trends, create predictive analytics, and leverage historical data to inform current marketing initiatives.
A CDP is ideal for businesses that interact with customers:
  • Ecommerce (customer transactions)
  • Software-as-a-Service and subscription companies (regular customer transactions)
  • Internal marketing or communications departments (marketing, IT and other departments often store customer data)
  • Email communication (campaign response data)
  • Customer service information

Important!

When considering a CDP, always start with a goal. What do you want to achieve? Once you have a goal, you can determine if the benefits of a customer data platform exceed the effort to create it.

Too often companies jump into what may be considered cool, or what they hear someone else is doing without a blueprint.

CDP vs CRM

If you’re familiar with a customer relationship management system (CRM), you may be wondering what’s the difference.

A CDP and CRM are similar as they both store customer data with the purpose of keeping an up to date record of customer information.  Where they differ is how each system is designed for use:

  1. CDP is used to analyze data
  2. CDP stores data from online and offline sources (transactions, surveys, demographic info, campaign performance, etc)
  3. CDP is designed to handle large amounts of historical data (think big data)

Do you need a Customer Data Platform?

You may benefit from a CDP if:

  • You want to segment customers using data from separate sources
  • You want a unified view of customer information
  • You want to report on critical business metrics, such as CLV
  • You want to profile your most valuable customers and market to similar people
  • You want to understand purchasing behavior to influence marketing campaigns

Keep It Simple

I’m a big fan of creating a simple proof of concept and building from there. Focus on one aspect of design and the business benefit the design provides.

This approach helps keep costs down and reduces “scope creep” (when extra features get added to an already defined project timeline).


Want to know more about customer data platforms?

Contact us to see how a customer data platform can help your business.

Founder of Sure Optimize

Sure Optimize is a data science company specializing in marketing & customer analytics.

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