Why Are Customer Data Platforms in Demand?
In the last few years, customer data platforms have become quite popular. They are on the top in enterprise marketing technology topics. After all, a customer database management platform is a solution to customer data integration concerns. The tool allows marketing teams to get a unified customer view. And in the era of digital marketing, its boom is no surprise.
What is a Customer Data Platform?
A customer data platform (CDP) aggregates and organizes customer data from various source systems. This data is used by other software, systems, and marketing efforts. CDPs collect and unify real-time data into individual, centralized customer profiles.
Why Do You Need a CDP?
Businesses today are swamped with more data than ever before. You have to record and analyze transactional data, demographic data, and lots of behavioral data. Moreover, there’s data you’ve got from known customer purchases, anonymous ad impressions, product usage, and customer service. The compilation of all these sets of data is customer data.
Generally, this data is stored in silos. As a result, it is challenging for companies to deliver consistent customer experiences across different channels and devices. A customer data platform is a prebuilt system that centralizes customer data across all these sources. It offers several benefits for organizations engaging in digital commerce.
The platform allows you to gain more customers, retain the right customers, and optimize the customer experience. Here’s a look at the top 3 benefits of the system that indicate the reasons for its growing demand:
- Acquire more customers with targeted segmentation
Segmentation helps to identify a group of individuals to target for a particular marketing campaign. It is a key feature of the customer data platform, and therefore, makes it easier for marketers to tailor digital offers that improve customer acquisition rates at a lower cost.
2. Personalize messages for customer retention
The platform provides a contextual view of each customer. Organizations can use this information to do much more than selling a product or service online. The platform assists marketers in developing personalized digital experiences that lead to long-lasting relationships and repeat business.
3. Optimize customer experience
Data is crucial for creating extraordinary customer experiences, particularly on digital platforms. A CDP lets businesses identify the next best action. It also helps them understand when it is not good to engage with a customer online due to a negative review or an unresolved issue. Personalization of interactions helps in improving customer satisfaction, loyalty, and retention.
CDP vs. CRM
CDP and CRM both collect customer data to add value to your organization’s performance. But that is the only similarity. A customer relationship management (CRM) tool tracks a customer’s actions with a brand. It records this via manual entry. On the other hand, a CDP independently creates unified customer profiles after sourcing data from various online and offline sources.
Conclusion
By removing silos, organizations can serve customers more efficiently and effectively. Customer data platforms are suitable for marketers. It eliminates the need to develop databases and integrate data. Besides, it provides a more holistic customer view.
