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How customer data platforms benefit businesses and their customers

The marketing sector can be a complicated place as new marketing tools and techniques are launched, almost on a weekly basis. Powered by The Drum Network, this regular column invites The Drum Network's members to demystify the marketing trade and offer expert insight and opinion on what is happening in the marketing industry today that can help your business tomorrow.

CDPs are becoming increasingly important to personalised marketing.

Businesses are accumulating more data, at a faster rate than ever before, however many are finding themselves data rich, but insight poor.

‘Behavioural’, ‘demographic’ and ‘transactional’ are just some of the data points being collected. Yet typically, these are stored in silos and ‘owned’ by different departments, often resulting in the data becoming unworkable.

An additional challenge for companies is being able to track data accurately from cross-platform or pre-site activity, through to site goals or conversion.

Take email, for example, platforms can send out emails, but when it’s time to accurately track click-throughs to onsite actions, directly or indirectly, this is often a challenge, sometimes causing conflicting views on behaviour. All this contributes to making the Single Customer View (SCV) ever more elusive.

Yet, for marketers who are being asked to provide a 'consistent', 'personalised' customer experience across all channels, it is essential that data is collected and stored in a way that allows for a unified view of their customers.

Which is why the emergence of marketing tech called Customer Data Platforms (CDPs) is a much welcomed development promising to make the lives of marketers much easier.

What are CDPs?

David Raab, a respected martech analyst, describes CDPs as: “A marketer-managed system that creates a persistent, unified customer database.”

CDPs collect and unify first party customer data from multiple platforms. They bring all IDs into one hub, making it easy to identify and understand audience behaviour. This enables marketers to personalise communications, e.g push notifications, based on each user’s profile.

CDPs store all types of user information, from audio recordings of customer service interactions, chat transcripts, email responses, mobile app sessions, purchase orders, social media comments, website visits, and much more, all in one hub.

The diagram below shows how they work:

But what does a CDP actually do that other marketing tech can’t?

It allows marketers to track all user events and behaviours, across multiple channels, to create a universal customer data layer housed in one hub.

Once collated, marketers can then use it to understand who their customers are, what they like to do, and how best to communicate with them.

They can then start to use the data to build user profiles, and segment users based on their profile and behaviour. They can then treat users differently depending on their understanding of them.

Once a user has been profiled and segmented, and marketers have “identified” them and put them into a category, they can set triggers and personalise their experience and the communications that they send out to them in the future.

For example, they can treat users who put items in their baskets but don’t make a transaction, differently to those who make an instant purchase.

Example of how to use a CDP

The German railway company, Deutsche Bahn, has started using a CDP according to Econsultancy, to improve customer experience on board its trains.

Using real-time, live data, collected by a CDP, it sends push notifications via its app, to passengers on busy commuter trains, giving them the opportunity to upgrade to first class at a discounted rate.

The CDP combines the personal data with contextual data (how busy the train is on the trip), to make this happen. It is a special moment that a customer will definitely remember, as well as providing a direct profit generation for Deutsche Bahn.

Four benefits of CDPs

If you’re still not convinced by the merits of adopting a CDP, take a look at four of the benefits we’ve outlined below:

1. Allow marketers to track users across all platforms, through a universal data layer. Once data is captured, they can take event level data to create profiles that enable them to action push notifications, via platforms such as apps or emails.

2. Enable marketers to create a Single Customer View (SCV), by taking all user behaviours and stitching them together to provide one view of the customer.

3. Make segmentation possible: once the user data has been unified it can then be profiled and segmented to greater levels of detail, even adding values to these segments where appropriate.

4. Facilitate deeper level of audience insight and understanding: this enables marketers to provide rich personalisation and improved customer experience to benefit both business and customer.

Key benefits at a glance

  • All data in one place;
  • Allows you to standardise your audience segmentation across platforms;
  • Response measurement is joined up, all in one place with unified metrics;
  • Provides you with a SCV;
  • Helps to improve marketing automation through personalisation;
  • Helps reduce churn through improved personalisation;
  • Can partner with testing tools to improve on site customer experience;
  • Provides businesses with better audience understanding through deeper insights on behaviours and touch points which can lead to increased customer loyalty.

View from ORM

CDPs are becoming increasingly important for businesses for a number of reasons. Not only do they help marketers to intimately understand their customers and enable them to communicate with them effectively (i.e. sending them tailored and personalised information and content), the data insights drawn from them are having a positive impact on the bottom line, too. Not only through efficiencies in communication investments, but customers are happier, receiving relevant content/offers, personalised to their needs, and businesses are content too – happy customers mean loyal customers, who will come back with repeat business. Plus, companies are looking smarter and more in-tune with the needs of their customers, which is a must in this digital age.

We have just launched our data service at ORM – come and talk to us about how we can help you to realise the potential of your customer data.

Leona Bell is the head of data at ORM

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