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With so many moving parts involved in crafting a modern customer experience, the need for a customer data platform (CDP) is unavoidable. A CDP platform can help ease the woes of customer data management by helping your business collect data and use it in real-time to help your marketing team reshape the customer journey.

In tandem with a CDP, your business will also need a general data warehouse solution and an integration tool to help you move your data between those platforms. Integrate.io can help fulfill the latter duties by providing a lightning-fast CDC platform, ETL tools, and deep Ecommerce capabilities. With that in mind, here’s how a CDP comes together using third-party data from various sources to help reveal new customer insights.

What is a Customer Data Platform?

A customer data platform’s main functionality is to create a unified customer profile by collecting data about customer behavior, customer interactions, and customer engagement. Since a CDP can pull from multiple data sources, it can help eliminate data silos while bringing new efficiency to your marketing automation workflows.

In addition to third-party data sources, such as social media, a CDP platform will also unify first-party data, like that found within your customer relationship management (CRM) platform. By creating a complete customer database, a CDP can assist with calculating data points such as customer lifetime value (CLV) and performing marketing activities, like customer segmentation. In other words, a CDP is powerful enough to help you dig into the demographics and transactional data of an individual customer, which is precisely why it’s so valuable for marketing personalization.

Of course, because a CDP solution will store a wealth of customer information and personal identifiers, data privacy is a significant concern. As such, implementing a data governance strategy is an essential step for companies looking to adopt a CDP.

How Does a CDP Platform Work?

In practice, a CDP platform helps data analysts better understand their audience by revealing trends in activity at various customer touchpoints, ultimately generating a wealth of data on acquisition and retention. Using that information, data analysts can guide changes to websites, ads, experiences, and even the products or services offered.

More than that, with a single customer view, marketing teams can directly improve acquisition and retention by personalizing marketing campaigns based on that user’s interactions with the company’s ads, website, and customer support team. That’s where the true power of a CDP platform comes to light, as it provides a detailed view of the customer, which is referred to as identity resolution. In a process known as activation, that information can then be combined with machine learning and marketing technology to automatically tailor a customer’s experience to improve outcomes.

A CDP solution is a staple in MarTech and data analysis infrastructure, but the use cases for a CDP are truly focused on unification and marketing initiatives. It should not be confused with a Data Management Platform (DMP), which is used strictly for advertising data and not for marketing personalization. A CDP shines because it combines the core activities of data collection, organization, storage, and analysis into one platform.

Benefits of a CDP Platform

Offering a complete view of a customer is surely the single greatest benefit of a CDP, but there are additional advantages that your company will enjoy if you decide to implement a CDP solution. 

Highly Organized Customer Data

When first setting up a CDP, you'll find that your team actually spends a substantial amount of time determining what information actually needs to be there and how it should be organized. However, once that initial setup work is done, a CDP makes keeping a highly organized database of customer information extremely simple.

Improved Data Privacy

The General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) are just two examples of far-reaching requirements for storing and using customer data. Merely having a CDP means storing a lot of information about your customers and actively using it, which requires a well-thought-out data management strategy.

Of course, while implementing a CDP might bring data privacy regulations front of mind, it can also help you achieve those standards. Namely, by creating a data governance plan alongside your strategy for using your CDP, you will likely end up limiting the amount of information you actually collect. 

In addition to collecting only the most valuable information about your customers, a CDP will also help you map out where each data point comes from and how it's collected, which is important in determining which regulations apply in the first place.

With those considerations in mind, implementing a CDP could help streamline your business's data governance planning, but it's not something that will happen on its own. Keeping your data secure, especially as it's pulled from other sources and moved into your CDP, is extremely important to achieving data privacy standards. Therefore, a trustworthy integration platform like Integrate.io is essential in helping you pull it off. 

More Insightful Analytics

As any data analyst knows, analyzing customer data does not start with a report. In reality, customer data analysis begins at the moment of collection, as knowing what to collect, how to collect it, and where to send it is essential for actually using the data you have on hand.

Since a CDP combines all four activities involved in analysis (e.g., collection, sorting, storage, and analysis), while also pulling and organizing data from various sources, it's a true powerhouse when it comes to data analysis. 

Related Reading: How to Use Data to Get Ahead of The Competition

Choosing a CDP Solution

There is no one-size-fits-all solution to finding the right CDP for your business. Beyond your budget, you need to ensure the CDP you choose will work well within your industry, which means it can accommodate the unique data points and use cases you will be working with regularly. With that in mind, here are the key steps you need to follow. 

1. Define Your Use Cases

While you might assume that all CDPs will be used in much the same way, with droves of customer data coming in and various connectors making use of it on the other end, the same platform can actually be used in very different ways based on your company's industry, size, and marketing channels or strategies.

When most businesses think about why they need a CDP, they simplify it to the need to consolidate their customer data. While a CDP achieves this, that's far from the real reason a CDP is necessary or appealing. To get to the real reason, you need to ask why, starting with, "Why is data consolidation important to us?" 

Once you work through the list of standard answers, you'll begin to dig into the details of your specific use cases, like better understanding the complete journey your customers take or being able to combine online and offline data for a more complete view of acquisition, value, and retention. 

Some CDPs are better at some things than others. For instance, where one shines with helping you analyze offline data, it might fall short when it comes to automated marketing personalization. Likewise, even if you find a platform that says it's great for personalization, it might be made more for website personalization than for targeted multichannel marketing. 

Knowing your use case from the very beginning of your search will help you narrow down your options quickly and ensure that you choose a CDP that will be most valuable to your business. 

2. Validate Your Integrations

Data integration goes hand-in-hand with implementing a CDP solution, which is why it should be a top-of-mind concern. Ideally, the CDP you choose will have native integrations or pre-built connectors with your most-used data sources. This is important as it will not only save substantial time during setup, helping you to launch the platform sooner, but it will also save you effort down the road in maintaining connections that you set up manually.

Fortunately, confirming that the CDP solution of your choice actually integrates with all of the data sources you plan to use is fairly simple. Most offer an integration summary that will take you through all of the integrations, and they can typically be activated in just a few clicks. Of course, just because a platform doesn't have a pre-built connector with a CDP platform doesn't mean you can't use it.

To make sure that data flows smoothly between your data sources and into your CDP, you will likely need a data integration solution that can create a fast data pipeline while also ensuring data comes out properly formatted on the other end. With robust ETL and reverse ELT capabilities, Integrate.io does just that. 

3. Plan Your Implementation

No matter how feature-rich a CDP solution may be, its implementation is often a make-or-break factor when determining whether or not the project will succeed. As such, planning out the implementation to ensure the greatest chance of success is crucial.

You can help ensure the success of your CDP before even choosing one by making sure you pick one that meets these criteria:

  • Find a CDP solution that offers fantastic documentation and great customer support. Ideally, you'll have a team standing by to help you work through (and avoid) implementation hiccups.

  • Look for a CDP solution with the most native integrations you can find. This will help your engineering team save countless hours, which equates to thousands of dollars worth of labor.

  • Seek out a CDP solution that is intuitive to use, especially in the context of your specific use cases, so that you don't have to spend a lot of time on training or workarounds for a solution that isn't the ideal fit.

While it will take time to find just the right CDP solution, it can be done so long as you work within the context of your company's needs. In all cases, that requires someone to sit down with stakeholders from various departments and work with them to ensure all things are considered when prioritizing features. 

Tips for Using a CDP

In order to make sure that your customer data is actually usable, it's important that your business follows some key best practices relating to data management. 

Follow Good Data Hygiene

Your company does not need to track every data point under the sun. Oftentimes, businesses try to track too many metrics, and it leads to a swell of low-value data taking up space (which is an expensive problem in today's cloud-first world).

Instead of finding all the metrics you can store in your CDP, start by identifying your North Star Metric, which should be the single most important metric that guides your business's decisions. From there, you can identify the secondary metrics that provide context. 

With that list in front of you, it's important that you don't pull in other metrics just for the sake of having them. While there's no true limit to how many metrics you can track with your CDP, you don't want to fill it up with data points that aren't going to be useful. So, identifying the metrics that aren't helpful is just as important, especially when it comes to good data organization. 

And, the worst thing a business can do when it comes to data management is to continue storing outdated information. In addition to wasting space, it can take away from the accuracy of your analysis, especially if you have droves of old information about customer demographics. 

As such, good data management requires you to regularly sort through your data and ensure it is recent, accurate, and complete. For older information, you can take the initiatives to update or confirm it amongst your customers (e.g., a popup when they log in that asks them to confirm their phone number). However, when it comes to inactive accounts, the best thing is often just to purge the data, which is a great practice when it comes to achieving data privacy standards. 

Create a Complete View

When first pulling data into a CDP, it can feel a bit overwhelming as there is simply so much data your company might want to track, even after going through the list and crossing things out. One of the best ways to guide your CDP implementation is to sit down and focus on creating a single and complete customer view.

By thinking about creating a complete view, you can instantly begin to identify which data points are necessary—some of which you may not yet be tracking. For this part of the process, the marketing and sales teams often need to collaborate to determine the exact metrics that are valuable for painting a picture of how to measure customer engagement, conversion, and satisfaction. 

Measure Its Success

As with any project a company undertakes, implementing a CDP requires goal-setting and tracking to ensure the project is successful. However, when it comes to software implementation projects like adding a CDP solution, it's not always so obvious how success can be measured.

Ultimately, what success looks like in a CDP implementation plan will vary depending on your company's use cases for the software. And, while a CDP does not directly contribute to revenue generation, you can find metrics to help measure how well it's helping your departments with revenue-generating activities. 

Some examples of the metrics you can track to measure the success of your CDP implementation from all angles include employee engagement and usage; the accuracy of the CDP's machine learning tools; and how many hours your engineering team saved by using a CDP with native integrations over trying to integrate a handful of tools manually in place of one.

Let Integrate.io Streamline Your CDP Implementation

With marketing personalization being a crucial activity for today's businesses, and with so much data stored in so many different places that it's almost impossible to use, implementing a CPD solution is the logical next step in making sure that your business remains competitive.

For data analysts, the value of a CDP platform is immediate as soon as they begin to understand just how much information can be combined and unified. Especially when combined with the power of machine learning algorithms, the concept of a CDP grows all the more exciting for better understanding the customer and better serving them.

Of course, choosing a CDP solution isn't easy. One of the biggest factors you need to consider to ensure the highest possible ROI is making sure the implementation process goes smoothly. More specifically, this requires easy-to-use integrations that don't take up a lot of time from the engineering team. Still, it's unlikely you'll find a platform with native integration to all of your data sources.

In order to move all the data you need into your CDP, you'll likely need a data integration tool like Integrate.io. With pre-built connectors and a powerful interface that speeds up the creation of custom integrations, Integrate.io can save your team countless hours while making sure you get your data exactly where it's needed and in the right format.

Interested in learning more about Integrate.io? Schedule an intro call today.