Customer Data Platforms: stop wasting your budget

I have recently moved roles and started to research the deep and rich world of marketing and, to be more precise, CDPs or Customer Data Platforms. And, as someone relatively new to the marketing world you can expect the question… What is actually a CDP? Well, while there is plenty of documentation and papers on the subject, it actually took me a bit of time to really understand what this CDP thing is all about, and how it can transform business the way it does.

And, actually, the response is quite simple. A Customer Data Platform is all about knowing your customers. An Acquian and colleague of mine said:

Analytics is for the things you want to know. CDP is for the things you want to do.
~ Scott Falconer

Indeed, Analytics shows you that X% of people have abandoned a cart, for example, while CDP is great to actually identify which person abandoned the cart, and potentially execute an action on that (ie, sending an email, etc)

Small details: connecting the data

Evil is in the (small) details.

That small detail of knowing exactly who to send the information is key.

Imagine the typical scenario of a company with thousands of records of thousands of customers. The problem nowadays is not collecting that data. The real problem is connecting that data. Connecting that Dave, who signed up on the website 2 years ago looking for information about surf boards, is the same person that rented a small sailing boat 1 year ago, and the same that now seems interested in foil surfing (a new surf trend). If you are a company offering those many products you probably want to know what the customer is really interested in buying nowadays, not what he was 2 or three years ago. Or even a month or a week ago.

Today’s Dave may be into foil surfing. However different departments in The Surf Company have “broken” or disconnected pieces of information, which shows that Dave is interested in Wind Surf and Kite Surf, because I took a course 10 years ago. Again, that’s the Dave of yesterday, not the one that nowadays is into foil surfing.

If you send today information to Dave about Windsurf nowadays you have pretty much 0 chance to sell him any Windsurf material. Imagine the hundreds of customers The Surf Company is sending emails to, that are in the same position as Dave. Email marketing is expensive, how much money TheSurfCompany (maybe you as well) is wasting on that area? How much money are you wasting on so many other marketing campaigns targeting the wrong customers?

Another probably close example, does it not annoy you those pesky ads about that product that you were really interested in a week or a month ago, but that after purchasing the product, or any alternative, the ads are still being displayed to you, be it in Google adwords, Facebook any other media?

Well, guess what, your customers hate that as well.. And what is more, it's wasting money and resources away from parts which would make more sense for you to invest.

And, actually, most of the time the information is there. As I introduced, nowadays the problem is not collecting information. The problem is making sense of all of it, connecting the dots. And that is precisely what a good CDP should be helping you with (but not just, at least in the case of Acquia’s CDP).

In other words, CDP is the missing link for every marketeer to understand who your customer is, and send him the information he is really interested in. Actually, bombarding a user with unrelated information will probably increase the chances the user unsubscribes from your database and you definitely lose him. And with the customer your credibility goes through the door as well. Everyone knows how expensive it is to get new customers, shouldn’t your efforts be geared towards keeping them? That’s something nowadays everyone agrees on, but very few people actually take action on.

The way Acquia’s CDP works is, all that data on different databases, on different departments, across different years of activity is fed into the CDP. Then there will be some “magic” happening, and as the output of that magic, the CDP should be able to identify that my 5, 6 or 10 different profiles are actually a single one, and it should be able to tell my history, as a single customer. 

But that’s just the beginning of the story. A good Customer Data Platforms should be helping you with this (called Customer Resolution). An outstanding, best in class CDP, with Artificial Intelligence at its core, will be able to go one step further. It’s not just about who I am, but  what Dave is interested in nowadays, and even things like what I’m likely to buy in the next few days or weeks, what would be the next best product that I should recommend, etc etc.

If you are interested in the machine learning part and the models that Acquia CDP uses as per today I highly recommend reading Machine Learning Models in action, and What Machine Learning can do for you

What are the benefits (and risks) of investing in a CDP?

All this is good and well, but like any investment, there are risks that need to be taken into account, as any CDP solution is not cheap. 

A study executed by Forrester may throw light onto the subject. For the TLDR (Too Long Didn’t Read), some key numbers:

CDP metrics
  • “Insights into accurate, unified data enabled smarter strategic spending and business decisions, while personalized campaigns drove higher conversion rates”
  • “A personalized call center experience that doubled the sales conversion rate”
  • “New customer acquisition from improved ad targeting, resulting in more than $1.5 million in benefits over three years”

For more details on these data, key findings like quantified and unquantified benefits, analysis of costs (including licensing and professional services costs), TEI (Total Economic Impact), etc  I’d highly recommend downloading the report.

The customer interviews and financial analysis found that a composite organization experiences benefits of $9,535,627 over three years versus costs of $1,383,979, adding up to a net present value (NPV) of $8,151,648 and an ROI of 589%.

 


OK, fine, where can I learn more about CDP and Acquia CDP

Start with

Learn what is Acquia CDP and its peculiarities and advantages

Machine learning

Now you’ll probably want to dig deeper on the Acquia CDP solution. Acquia Academy is always a great place to start with any Acquia product