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Customer Data Platform (CDP) as a part of digital marketing future

With growing numbers of digital channels and amounts of customer data it's still more complicated for business to get unified view on their customers. Therefore CDP is becoming more necessary tool for modern digital marketing. aricoma avatar

Do you know what is Customer Data Platform (CDP)?

 CDP (Customer Data Platform) is a tool, which collects all customer data in one place. Thanks to that business can better get to know their customers and create personalized experiences, for example recommending products by what customer bought in past or looked for in past. Customers, which see personalized content, have almost 5 times higher chance for interaction. And also, CDP enables so called "suppress ads" - meaning that the ads won't show up to people, who already bought the product.

With increasing amount of digital channels and customer data, comes platform, which collects data about customers from different sources, integrates them and helps create complex profile of every customer.

Up to 45 % of businesses say that unification of customer data is main reason for investment in CDP (Source: World Metrics), because it gives businesses a powerful tool for impressive marketing presentation.

CDP is the key to success thanks to data personalization

In todays competitive enviroment consumers expect, that companies will offer them content and services accustomed to their preferences and behaviour. But without correct data strategy it is very difficult to personalize communication on higher level.

  • Did you know, that for example company Netflix generates 1 billion USD annualy thanks to personalized recommendations? (Source: Business Insider)
  • And did you know, that AI algorithms increase number of leades about 50 %? AI decreases costs for acquisitions of customers to up to 60 %! Prediction and machine learning helps to create from CDP indesposible tool for marketing and customer support in 21st century. (Source: Harvard Business Review)

That's why CDP provides businesses effective tools, thanks to which they can use data in real time, accurately segment public and provide personalized experiences across all channels - from web to customer support.

It has essential role in digital transformation of businesses, which want to be data managed. It provides option to not only collect data, but also integrate them with other systems and tools, which businesses use - from CRM to marketing platforms.

Thanks to that it is possible to quickly react on changes in customer behaviour and adapt offers always to their current needs. For companies, which want to keep up with times and strengthen their position on market, is CDP key tool for effective and long-term sustainable growth.

How CDP works?

Customer Data Platform (CDP) is designed like that, so it could collect, consolidate, analyse and actively use customer data from different channels (Integrates data from offline and online channels) and sources. This architecture allows businesses to maximalize their data potential. It can connect anonymous data (e.g. cookies) with personal data, once the customer provides their data.

Let's go through main parts of architecture of CDP and the key functions it offers.

CDP Structure

Central customer data storage

  • Personal data - name, e-mail adress, city, country and other information available from business databases.
  • User type - automatic customer identity recognition as anonymous visitor or registrated user.
  • Interaction and activity - overview of transactional data, favourite channels, typical activity times and membership in segments (prefered products etc.). Customer timeline.
  • Orders history - list of all realized transactions connected with specific customer, including all expenditures and number of purchases.


Life-cycle of customer - automatic customer categorization into phases Acquire, Convert and Retain. Activity heatmap and visualization of behaviour patterns.


Data in real time

  • Businesses can immediately react to customer needs.


Modular architecture

Thanks to open architecture and robust API it is easy to connect even offline data for creation of unified view on customer. To that help following aspects:

  • Integration through Batch API - it allows bulk loading of historic orders and offline data from external sources.
  • Accommodation to data structures - modeling of data before import, so it would match standard model of orders in Sitecore CDP.
  • Using REST API - management of single records in real time including creation, loading, update and removing od data.
  • Extension of data models - option to add own attributes to orders and items for capturing of specific information.
  • Export and analysis of data - automatized export configuration from data pool Sitecore CDP for creation of advanced analytic models and personalized campaigns.


Focus on data security

  • Compliance with regulations, e.g. GDPR.
  • Safe and legal management of data

Main CDP functions

Data collection

CDP collects data from different sources, e.g. web pages, mobile applications, CRM (Differing from CRM is that CDP focuses on whole customer life cycle, not only it's interactions with customer), e-mail campaigns, social media or customer support. It saves all data to one central data storage.

Sběr dat

Unified view on customer

CDP provides 360 degree view on customer integration of all available data to one effective profile. Therefore CDP allows marketing teams and customer support to share unified information about customers. So it helps businesses easily identify and correct errors in customer data (e.g. duplicite profiles etc.).

Jednotný pohled na zákazníka

Segmentation and data analysis

With the help of artificial intelligence (AI) and machine learning can AI foresee future customer behaviour, which helps companies to plan marketing better and increase effectivity of campaigns. Thanks to CDP it is also able to create so called lookalike audience and adress similar new potential customers.

Segmentace a analýza dat


CDP integration with other tools

As are CRM, DMP, analytic and marketing tools. Thanks to integration with analytical platforms can businesses do more detailed data analysis, while connection with marketing tools ensures trouble-free data activation in campaigns.

Integrace CDP s dalšími nástroji

Data activation in real time
Businesses can immidiately react to customer behaviour, e.g. by sending personalized offers or discounts on right now overviewed product.

Aktivace dat v reálném čase

 

Key facts and statistics about CDP

  • Market growth: Global market with CDP was in 2022 valued 1,75 billion USD and it is expected, that till the 2030 will reach 9,92 billions USD, with avarage annual growth (CAGR) 24,4 % during this period (Source: Fortuna Business Insights).
  • Main industry: Retail sector and digital media made in 2023 more than 70 % value of market with CDP (Source: Juniper Research).
  • Regional growth: North America is the largest market for CDP, while Asia shows the fastest growth thanks to growing digitalization and demand for personalized customer experiences (Source: Mordor Intelligence).

Accurate personalization and effective targeting

Better customer experience

Compliance with GDPR and other legislatives

Increased effectivity of marketing campaigns

Simplification and automatization of intern processes

For who is CDP suitable?

CDP is primarily suitable for big B2C companies with large portfolio of products and big number of customers, as are retail sector, e-commerce companies, banks or telecommunications. Businesses who need detailed and unified view on customer, so they could provide highly personalized services (Ensuring correct communication on the right channel in the right time) and quickly react to changes in customer behaviour across digital channels.

But CDP implementation brings extensive financial costs. Annual licence of high quality CDP solutions usually costs around tens or hundreds of thousands of euros, and that depends on the extensivnes of functions and amount of data.

Next item is service and platform management, which can include team of specialists and data analysts. For companies, which are dependend on effective use of customer data, is this investment often worth it due to several times ROI on marketing campaigns, increased loyality of customers and optimalization of marketing costs.

Sitecore CDP: One of the best solutions on the market

Sitecore CDP represents top-notch solution in Customer Data Platform (CDP) and offers companies option to get maximal use of customer data. Here are key benefits and specific functions, which Sitecore CDP brings.

Unified customer view

One of the main benefits of Sitecore CDP is its ability to create unified customer profile or 360 degree view on every customer. Sitecore collects data from all available sources - from web pages and mobile applications to CRM sytems and social sites - and connects them to one, organized profile.

This profile includes demographic data, purchase history, reactions on marketing campaigns and behaviour to different digital channels. This allows businesses to more accurately understand their customers, which reflects in personalized marketing campaigns, effective communication and overall better customer experience.

Advanced analytics and artificial intelligence

Sitecore CDP is equipped with advanced analytic tools and uses artificial intelligence (AI), which allows predictive marketing and deep analysis of customer data. Thanks to these tools can businesses identify and analyze customer behaviour patterns, predicts their needs and prepare targeted campaigns, which brings high return of investment.

AI in Sitecore CDP helps wtih effective customer segmentation, so businesses can create highly relevent offers for different segments of customers and optimize marketing costs.

Real-time data activation

Important Sitecore CDP function is real-time activation of data. Data about customers can be immediately used in marketing campaigns and other interactions with customers. Real-time activation allows businesses to react on customer behaviour in real time, e.g. based on just browsed products on web or sales in mobile applications.

Businesses can send to customers personalized offers and communication in right time and through the right channel, which increases probability that customer will react to the offer.

Integration with other systems

One of the main benefits of Sitecore CDP is its large possibility of integration with other systems and applications, which business already uses - anything like CRM, DMP, e-mail systems or analytical platforms. This compatibility allows maximal use of customer data across the whole business, which ensures consistency of data in all departments.

Marketing teams can for example connect Sitecore CDP with e-amil marketing system and more effectively manage campaigns, while sales department can approach to unified customer profiles and better target potencial clients.

Future of CDP in digital marketing

Digital market changes quickly and ability of businesses to personalize and automatize interactions with customers will be the key competitive benefit.

With big corporations won't soon be the question, if implement CDP, but how quickly and effectively integrate it, so they won't stay behind with their rivals.

Automatization and use of AI: Future of personalization and prediction

Automatization and AI in CDP move personalization to a higher level. It allows quick reactions, like generating offers or recommendation without the intervention of a human.

This technology is key for big companies, which need to effectively manage millions of personalized interactions daily.

Long-term significance of CDP for business management

In future it is expected that businesess, which will be able to use data not only for marketing, but also for strategic management, will have significant head start. CDP will play essential role in data management strategy, where data about customers will allows companies to better predict trends, optimalize products and adapt them to chages on the market.

Companies will not only react to wishes of customers, but also actively form their expectations and preferences. This pro-active ability coming from data and predictive analysis will be one of the most significant beneftis, which CDP will bring in the future.

Foto autora, Petr Míka

Petr Míka

Senior Sales Manager

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