What is a Customer Data Platform? Ultimate Guide

Customer data platforms, or CDPs, are words you might have heard thrown around in marketing automation discussions. And we know that marketing (especially on the automated front) is flush with data already. Yet, so much of that data remains worlds apart and disconnected from other strategic points of information. That’s where CDPs step in. We’ll take a dive into emerging technology and examine how these new data platforms assist marketers and marketing automation as a whole. We’ll also share a list of our top CDP products to kickstart your software evaluation.

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What is a Customer Data Platform?

Well, before we get ahead of ourselves, let’s crack open those textbooks and look at some definitions. According to the CDP Institute, a neutral body dedicated to informing and assisting marketers, a customer data platform is “packaged software that creates a persistent, unified customer database that is accessible to other systems.” It has three components:

• Packaged software
• Creates a persistent, unified customer database
• Accessible to other systems

And if you’ve been following our work, you already know what marketing automation software is, what its functions are, and how it can be used (if you’re not sure, check out our marketing automation resources for a rundown).

Customer data platforms build unified customer data profiles that can then be accessed by other systems and programs. Let’s look at it another way: you’ve got some customer data in your CRM, and some customer data in your marketing automation suite. Oh, and you’ve also got some in your business intelligence tools.

What you have is three reservoirs of important customer information that’s stored away in databases that don’t always play nice with each other. This can present quite the roadblock when you’re working on a people-first automated campaign. How do you know what your buyer personas are if they’re in your CRM? And what if your BI data conflicts with what’s in your MA databases?

CDPs to the rescue! They give you one unified source of stored customer intel to pull from, eliminating any communication breakdown in your tech stack. The CDP institute says, “A CDP puts marketing in direct control of the data unification project,” and we couldn’t agree more.

What Data is Collected?

There’s a lot of data for marketers to touch on when crafting their messaging. One major benefit of a CDP is the sheer amount of data they collect. When a customer leaves information behind after visiting your IRL store, blog, website, commerce portal, whatever, they create what we call first-party data. That data can be identity data such as:

• Name info
• Demographic info
• Locational info
• Contact info
• Social info
• Professional info
• Account info

CDPs don’t stop at identity data, however. They also collect descriptive data, quantitative data and qualitative data, and that data can go so deep that it’d take us an entirely new article just to explain everything. Just know that CDPs collect data that goes far deeper than what a CRM might collect. Rest assured, they’re also GDPR-compliant.

In all cases, before the customer hands over their data, they have to give consent. The collection process, while in-depth, is purely consensual. And a user can request that they have their data be deleted from the database at any time. Though this hinders your ability to personalize content and messaging, it’s also what lends the CDP its strength — flexibility and d?iversity.

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CRM vs. CDP

While CRM and CDP both collect and manage customer data, it is important to understand what each software is and what it does. Understanding the difference between CRM and CDP will help you understand which software is the correct one for your business and its growth. Here are some of the key differences between CRM and CDP:

How CRM Helps a Business:

• Manages front-office management tasks.
• Filters and presents sales pipeline analytics and forecasts.
• Offers win/loss analysis for building business strategies.
• Provides prospects for customer acquisition.
• Takes care of post-sales customer service.
• Empowers easy purchasing through quote-to-cash (QTC) and end-to-end business processes.
• Leverages marketing automation capabilities for easy campaign tracking and performance review.

How CDP Helps a Business:

• Facilitates automation of functionalities such as integrations, validations and cleaning specifically for data management purposes.
• Identifies, classifies and segregates customer behavior through both online and offline channels.
• Provides persistent customer profiles and management for ease of operations.
• Offers customer journeys and lifecycle management through key analytics.
• Extends customer behavior analytics for improving segmentation for business such as pricing, marketing campaigns, customer retention and more.
• Provides purchase history and other behavioral information for various business categories.
• Empowers users with predictive analysis for identifying and acting on customer behavior. These analytics cover factors such as segmentation-based buying capacity, buying intent, buyer interests and more.
• Enables exporting of customer lists for campaign building, execution and business intelligence.

Benefits Comparison

CRM is ideally used for operational purposes as it provides tools that support a business’ sales, marketing and customer relation efforts on a day-to-day basis. CRM software runs primarily based on direct inputs of customer data. It can assist with major operational tasks irrespective of company size.

CDP is essentially used to derive analytics that help business leaders understand and conclude customer profiles based on data and metrics. It gathers data digitally and offline from all customer-facing points which includes website analytics, in-store POS software, billing data and more. It leverages this data with the help of powerful machine learning tools and also offers predictive analysis that helps deliver and act upon relevant customer insights. This assists businesses to build and execute strategies backed by reliable, actionable data.

Data is the key to faster, more effective, budget friendly sales and marketing efforts. Each software caters to different kinds of data and feature sets. While CDP offers a complete view of the customer journey, CRM provides insights and assistance that can be used for operational tasks. The key difference between CRM and CDP software is how and what kind of data each delivers, and what it can be used for based on your business needs. Having covered the main characteristics that differentiate CRMs from CDPs, let’s investigate, why are CDPs important for your business?

In simple terms, CDPs inform all types of marketing which is backed by customer-facing data. They help you decide what’s best for your business growth.

CDP and Marketing Automation

CDPs improve the organization of your company’s data and help spread information to all departments. With marketing automation, in particular, the benefits are twofold:

1. Get better access to quality data to inform your marketing decisions
2. Unify cross-channel marketing efforts

Better Access to Quality Data

Marketing (digital marketing in particular) may as well be an IT discipline at this point, considering how close marketers get to their tools. As professionals, we’re particular about the tools we keep in our toolbox, and the same goes for marketing automation. Heck, we’ve built an entire business on helping people find the right software for their business. If you’re looking for advice in that regard, click the link below. If not, or you just need time, keep on reading for our take on a CDP’s role in MA.

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Data isn’t just the realm of geeks anymore – it’s an essential asset in the modern business landscape. We make decisions every single day based on what we know about our customers, about our businesses and about our goals.

Marketing automation (and marketing in general, folks) requires something of a gentle touch and paramount to that: good data. When you’re working with a team of marketers and creatives (sometimes they’re the same people), you need to make sure you’re proceeding on not just good, quality data, but ALL the data your organization can put together. Imagine trying to play darts with one eye closed — you’d have no depth perception! And that’s what it’s like to market without the whole picture.

CDPs aren’t data silos. They’re data unifiers that have the whole picture in mind. You’re getting data from all departments and can then incorporate it into your automated strategy.

This is where we need to consider the implications of automating your campaigns with a data platform. See, marketing automation churns out massive profits, according to our research. It allows you to “set it and forget it” when it comes to marketing, which can be a boon… or do significant damage. We’ll call it a double-edged sword.

Customers expect their personalized communication to be topical pretty – they want their names and interests brought up in helpful, creative ways. They want their questions answered and then some. How do you go about doing that? With data? How do you fudge it up? Sending automated email blasts without using a CDP (thus proceeding on incomplete data). Not personalizing their experiences based on their information. The list of marketing sins goes on and on.

We use MA tools like A/B email testing and custom content every day, and none of those work without access to good data. In fact, a complete view of your buyer’s persona informs every aspect of your marketing efforts, which brings us to our next point.

Unify Cross-channel Marketing Efforts

Marketing comes in all shapes and sizes, and thanks to the internet we have a whole slew of new ways to reach our customers. CDPs do something special, that, thus far, no independent MA platform’s data can do: put customers front and center in your mission to serve.

They deliver immediate communications across all channels that customers have come to expect – they touch upon every part of your buyer’s journey. They supply merged and highly accurate data to your advertising team, sales team, marketing team, automation dweebs, creatives and beyond. No more asking sales for figures, advertising for customer information or bugging your creatives to include elements in their work because your own data just revealed that your customers all own cats.

Often, we think a good manager is a unifying force behind a varied, multi-level effort. And while this is true, data has become nearly as important as solid leadership. A customer data platform could almost be considered a managerial voice in of itself.

Customer data platforms, to marketers, are

• Marketer managed;
• A persistent, unified database of customer information;
• Accessible by outside programs and systems (we consider this a cardinal feature);
• Systems that use a single identifier to link a customer to their data; and
• GDPR compliant

Best Customer Data Platforms

Now that you have a solid grasp of what CDPs are, what they do and why you need them, let’s go a step further. Our analysts have compiled a list of the best customer data platforms on the market to help you make an informed buying decision.

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Tealium AudienceStream CDP

Tealium AudienceStream is a unified customer data solution that gathers and collects data and acts on the customer experience by connecting data across devices and channels — all in real time. It helps with patented visitor stitching technology to construct customer profiles with ML-powered insights and defines high or low-value customers with key engagement insights and milestones to target suitable audiences. It allows users to set up custom rules for all profiles, understand customer identities and take appropriate actions.

It combines identity resolution, data enrichment and cross-channel audience management and is integrated within the Data Hub (CDH). This data can be leveraged to create data infrastructure for collection and delivery. It caters to industries of all sizes and offers SaaS deployment for businesses in retail, finance, B2B, media, healthcare, travel, hospitality, tech gaming, entertainment and more.

Benefits

• Marketplace for Integrations: Offers over 1,200 turnkey integrations for customer data collected through client-side and server-side. Leverages event-level or customer-level data to ensure that customers are engaged with the help of insights. Also provides a marketplace with integrations across the entire marketing technology stack including – analytics platforms, customer data management solutions and customer experience channels that assigns tags for filtering by data flow, category, device type and delivery method.
• Machine Learning Insights: Provides insights on data before orchestrating actions in integrated systems. The insights can be leveraged for any tool in the tech stack, regardless of the tool’s native machine learning capabilities. This helps predict high and low-value customers and take appropriate action.
• Visitor Stitching Technology: Patented, proprietary visitor stitching technology allows the matching of multiple identities and constructs unified customer profiles in real time. It replays the data from each stitched profile back in order to understand and map the sequence of the customer journey. It continually enriches incoming data with insights, thanks to integration with business rules which define the values of customers, key engagement insights, milestones and more. This helps in creating audiences and leveraging an integrated system to deliver a consistent customer experience or to analyze customer behavior.
• Mobile App: Provides SDK for installing mobile apps on Android and iOS platforms that allows getting, integrating and delivering mobile customer data as part of a comprehensive data supply chain. It also extends a unified approach, SDK management and data streaming capabilities, and can deliver a subset of data to various execution systems in real time.
• Customer Segmentation: AudienceStream is a real-time action engine that offers omnichannel and customer segmentation capabilities. The visitor profiles are segmented based on shared behaviors to create audiences, sets of visitors and common traits.

Features

• Personalized Interaction: Integrates with email, marketing automation, online advertising, social media and CRM platforms to enable real-time action within an existing marketing software. Actions are triggered based on real-time customer data signals across various channels.
• Real-Time Infrastructure: Data layering and real-time infrastructure capabilities offer an enhanced flow of data at speed. It provides real-time data collection, segmentation, enrichment and live delivery of actionable customer data that ensures the data is understood as it is collected. It also creates automated marketing campaigns based on up-to-the‑second audience behavior.
• Offline Data Source Connectivity: Allows collection and correlation of data which helps understand how an audience interacts with the brand offline. Some of this covers call center data and point-of-sale information which can be combined with online data for a universal 360-degree profile of customers.
• Visitor Profile Enrichment: Enriches visitor data with the help of marketer-defined business rules that separates profile attributes such as content affinity, lead scoring and lifetime value. This helps users maintain control of the metrics that are most applicable to a business.
• Cross-Device Identity Resolution: Maps cross-device activities with known customer profiles which helps companies to understand customer interactions closely through web, mobile and IoT channels. It also determines which devices are best suited for content creation, support, merchandising and marketing activities.

Limitations

• Doesn’t support alerts.
• Boolean search string option isn’t available for different job titles.
• Doesn’t offer a free trial.

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Segment

Segment unifies customer touch-points across platforms and channels to allow companies to understand the customer journey by connecting and activating first-party data across more than 300 marketing, analytics and data warehousing tools. It also offers SDKs for Javascript, iOS, Android and over 20 server-side languages. The platform is specifically designed for B2B service providers and caters to companies in B2B tech, consumer products, education, financial services, healthcare, media and retail industries. It extends SaaS deployment and is suitable for all sizes of organizations.

Benefits

• Customized Data Connectivity: The API allows source function to collect and transform the first-party customer data through webhooks into events which helps destination functions to transform and map events. The code snippets assist in building data integrations based on specifications – designating the source and destination functions.
• Visual Tagger: Users can track events by pointing and clicking on parts of the website; Upon implementation, these tracked events then can collect customer data based on actions that website visitors take such as CTAs, link clicks or form submissions.
• Open-Source Projects: With an open-source foundation, the tool supports projects built on AWS, Javascript, Go, NSQ, Tooling and Microservices that can handle API calls and build and run test code on customer data.
• Mobile SDKs: Offers the native functionality of all destinations without including third-party SDKs by default and installs the SDK to provide access to the entire suite of server-side destinations. It also allows custom building for both Android and iOS devices.

Features

• Data Warehousing: Supports capturing, schematizing and loading data into various data warehouse platforms such as Redshift, Azure, Snowflake, Postgres and more. It grants access to the libraries for data collection, and can track customer data and send it to a warehouse automatically. It also provides integration turnkeys for over 200 tools.
• Identity Resolution: The identity graph merges a customer’s complete history on a unified profile and tracks user interaction data across web, mobile, server and third-party touch-points – all in real time. The online and offline ID graph offers support for cookie IDs, device IDs, emails and custom external IDs.
• Profile Enrichment: Provides a real-time UI to understand customer behavior, first intent and preferences. It pulls customer data directly from the warehouse into Personas and activates marketing tools based on results. This data also covers internal data, machine learning models and historical traits.
• Application Security: Gains and manages access to accounts with single-sign-on (SSO) on the Business Plan and controls visibility with customer access levels, password guidance and multi-factor authentication (MFA).
• Data Query and Access: Provides APIs for queries and data access in SQL and automatically loads analytics data into the data warehouse. It enables automatic backup for data and storage providers such as Amazon S3 or Google Cloud Storage. The profile APIs provide a single API to read user-level and account-level customer data and allows querying the entire user or each account object programmatically, including the external ids, traits and events that encompass the customer journey through a product.

Limitations

• Can’t export a list of events to review offline.
• Doesn’t transform incoming data before sending it to destinations.
• Segmentation uses an external database.

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Exponea

Exponea is a cloud-based solution that provides email marketing, lifecycle intelligence, automation, product recommendations, predictive intelligence, personalization and full channel automation. It builds a customer view for every individual customer by connecting, tracking and unifying data from both online and offline sources. Additionally, it offers integrations for big data platforms such as Hadoop and BigQuery. It supports companies of all sizes and caters to various domains such as fashion, retail, e-commerce, travel, finance and the telecom industry, among others.

Benefits

• Campaign Calendar: Plan, design, test, execute and evaluate campaigns more effectively based on a schedule. Campaigns can be compared with metrics, previews and subjects in real time. The calendar syncs with all the existing campaigns and updates after every save action of a campaign. It also provides events, campaign status and filters on the basis of channel, status or campaign triggers.
• In-App Messages: Enables displaying campaign banners within the app along with pop-up web layers, similar to those on the website. In-app messages can be edited and customized. It allows comparing the conversion and clicks rates with the help of an evaluation tab that provides measurements of the effectiveness of the sent in-app messages.
• Integrations: Integrates with third-party systems such as email providers, messaging, ads retargeting, file storage, databases, commerce platforms, among others. It also offers integration via Zapier, JavaScript SDK, Mobile SDK and Rest API for tracking, device support and custom solution building.
• Real-Time Predictions: Better understand the intent of customers with the help of machine learning and predictive analytics. This helps rank customers based on their propensity to complete various actions like purchases, email opens and churning. It also empowers discovering high‑value customer segments and targeting them with personalized content matching their needs.
• Product Recommendation: Collects and analyzes cross-channel customer data and uses it for real‑time customer behavior analysis to compose product recommendations for first‑time visitors. The adaptive algorithm helps select the best possible recommendation model, matching business nature and meeting KPI objectives with consideration to the current data and trends. It also provides continuous A/B testing and real‑time optimization of the existing engines to ensure the customers get the most accurate recommendations based on their preferences.

Features

• Customer Identification: It automatically creates a customer record for every visitor to a website. It identifies the customer with the help of Soft IDs such as cookies that are unique for every website visitor. Customer actions such as purchase or logging are identified by Hard IDs such as the registered email ID of the customer.
• Real-Time Analytics: Gather new insights, capture customer behavior and transform raw data into data structures. Some additional data features include:
  • Key metrics and trends that present important data on a single dashboard.
  • Timeline of events to visualize their frequency.
  • Step-by-step customer journey.
  • A grid table of summarized data through custom metrics.
  • Timeline of frequency of an event reflecting how often customers return to interact with the business.
  • Chart graph that groups customers based on their attributes and behavior for customer segmentation and events.
  • Possible customer journeys on the website.
  • Geo Analyses that map out the geographical distribution of your customer base.
  • Predictions evaluate customer behavior with the help of AI.
• Exponea BigQuery: Helps acquire custom analytics by using BI tools of choice through in-house data storage. Exponea BigQuery is a petabyte-scale data storage within Google BigQuery that provides a secure, flexible and scalable infrastructure for data housing.
• Universal Links: Opens the link directly in the native mobile application without any redirects for the best user experience. Exponea SDK in the application also recognizes the link and tracks the click action for reporting purposes.
• Asset Manager: Allows users to create and manage templates for assets such as email, web layers and HTML blocks. These templates can be used in a range of marketing automation cases.

Limitations

• Doesn’t offer a free trial.
• Lacks mobile-responsive survey design.

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Arm Treasure Data

Arm Treasure Data brings together various kinds of data across different channels to compile a single, actionable view of customers. Its wide-ranging functionalities help users capture data, segment audiences, connect profiles, manage pipelines, work smarter with predictive analytics and engage in multi-channel efforts. It also offers infrastructure, support and data management capabilities that are needed for teams to collect, unify, analyze and activate customer data. It provides solutions to businesses in automotive, IoT, retail and consumer product goods, entertainment, marketing, advertising, gaming and more. It supports SaaS deployment and can also be self-hosted.

Benefits

• Predictive Scoring: Understands day-to-day customer engagement and delivers effective offers, promotions, recommendations and more. Built with a rule-based Segment Builder that offers access to machine learning logic, it can be used in new or existing segments to tailor campaigns more effectively towards customers’ interests.
• Unified 360 Customer View: Build a unified view of customers and deliver customer experiences at scale. Provides customer data capturing capabilities such as cross-device interactions and online-to-store via an accessible user interface called Audience Studio. View customer profiles, dashboards, create batch segments and set up models to predict the future behavior of master and batch segments.
• Integrations: Integrates with an enterprise’s existing technologies, including those in various categories such as CRM, databases, email marketing automation, mobile analytics, IaaS, PaaS and more. It also uses SDKs to collect data from different sources while the open APIs give access to thousands of systems and connect it to the entire technology stack.
• Pre-Built Code: Reduces the amount of time needed in development by providing a library for solutions of pre-built code, components, visualizations and applications called Treasure Boxes.
• Security and Privacy: Offers security that is ISO/IEC 27001:2013, EU-U.S. and Swiss-U.S. Privacy Shield Certified and has completed SOC 2 Type 2 audit by accredited external auditors. Complies with data privacy regulations, including the GDPR and CCPA. It also provides 24/7 network monitoring and data encryption in transit and the rest. Extend even more advanced security through options such as advanced policy-based access control, flexible policies to manage permissions, integration with enterprise authentication services, premium audit logs, pre-built data templates and more.

Features

• Embedded Machine Learning: Provides embedded machine learning libraries that support algorithms for recommendations, categorizing, language processing and more. This enables businesses to monitor and collaborate throughout the full data lifecycle and provides immediate access across data pipelines, resources and more without much manual input.
• Data Collection and Activation: Offers over 150 connectors to business intelligence and marketing systems along with event-based website tracking to collect all profile data for marketing campaigns. It collects PoS, IoT, web, SaaS, mobile, online and offline data for multi-channel customer engagement. It provides a data collection daemon that collects records from various data sources and uploads the data to cloud storage.
• Segmentation: Creates audience segmentation at granular levels to improve segmentation over time with the help of machine learning. It enables customer-facing teams to deliver relevant messaging with the help of display advertising, email communications, web personalization, purchase recommendations and more. The segmented definitions can be reused to refine the target audience and can be updated automatically.
• Profile Management: Provides complete customer profiles along with an intuitive interface and automatically concludes key characteristics such as location and content affinity from profile data. It offers built-in visualizations to highlight customer segment size, new customers and profile growth. It also assists in grouping profiles according to scores while building and maintaining profiles in a big data warehouse that is scalable.
• Workflows: Automate processes for adding new, relevant customer data that can be used to define objects of various queries, scripts and machine learning algorithms. It also schedules workflows to run according to business requirements.

Limitations

• Doesn’t allow merging directly to datasets outside of Treasure Data.
• SQL console doesn’t allow saving query templates.
• Doesn’t support Google Authenticator for 2FA.
• Doesn’t offer a free trial.

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A Quick Recap

Data is, and we’ll say it again, the lifeblood of businesses in the 21st century, and marketing is far from an exception. In fact, it might be one of the most data-driven professions at any company save for, well, your resident data scientists (if you have one).

A major roadblock for any department in your organization is that data can often be siloed and obscured, tucked away in a specific program or database that’s out of reach for marketing. Customer data platform is a more equal solution, providing all the same data for everyone to have access to.

And when you’re “setting it and forgetting it,” you can’t afford to stumble around in the dark. In terms of marketing automation, the wrong email blast to the wrong people is a great way to burn a few leads. Why risk it?

Need help finding the right customer data platform? We can help. Reach out to us for personalized software recommendations at contact@selecthub.com or call us at 877-692-2896.