The Five Most Important Characteristics of a Customer Data Platform


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Customer data platforms (CDPs) are powerful tools designed to operationalize the customer data brands collect and store already. Well-deployed CDPs can seamlessly integrate information across silos and enable brands to deliver personalized next best offers to the right person, through the right channel, at the right time.

The problem now is marketplace confusion. Because the customer data platform market is so nascent, with the term appearing less than a decade ago, there isn’t yet an agreed-upon definition in the marketplace. Or if there is, the definition is still fungible enough to be susceptible to change. Because of this, innumerable providers of other solutions have released materials that emphasize how they offer the same capabilities as a CDP already: building a unified customer profile across silos, providing real-time analytics for speed of the customer engagement, etc. Critics and existing players have also claimed that any number of technology combinations can unify customer data across silos already, which they claim means a CDP isn’t necessary. 

The solution is also new enough that many brands may not have heard it yet, which makes it easier for marketplace confusion to persist and vendors to claim the mantle of CDP even if they don’t provide the right capabilities. With such muddied waters in the marketplace, how can you tell if a vendor’s solution really is a customer data platform?

For a solution to truly be a customer data platform, it needs to include five key characteristics. These include:

  • Agility – The modern business must contend with multiple data types, multiple cadences, and multiple volumes. Customer data platforms need to account for all of it. Agility and flexibility are hallmarks of CDPs, including working with data warehouses, data lakes, and everything in between. CDPs also integrate first-, second-, and third-party data to create a dynamically updated view of a customer that can be leveraged in real time for analytics and decisioning.
  • Precision – A purpose-built CDP will feature strong identity resolution capabilities, including data processing rules and matching algorithms that automatically link customer data across silos to create unified customer profiles. Precision is critical to engage effectively with the modern, omnichannel customer – brands must understand who their customers are and be prepared to act on that information. Precision is especially vital given that 50 percent of customer interactions now happen during a multi-event, multichannel journey, according to McKinsey.
  • Scale – Agility and precision are not worth much if the solution cannot scale operations. CDPs that function effectively at scale reduce the friction inherent in delivering contextually relevant experiences across channels of engagement. A CDP should scale to meet the needs of the business user, especially in the fast-paced world that many consumers occupy. More than that, however, customer data platforms must accomplish this scale without relying on IT teams that are already strapped for time and resources.
  • Speed – According to Northeastern University, around 2.5 exabytes of data is generated per day. That is equivalent to 2.5 quintillion bytes of data … day in and day out. A customer data platform needs to have the capability of ingesting customer data in real or near-real time as well as making it available for consumption at the speed of the customer. The faster the CDP ingests the data and makes it usable, the more responsive the brand can be to the customer’s needs.
  • Accessibility – A well-deployed CDP functions as a “brain” for customer data by making data directly accessible for business users. CDPs must also democratize data access, enabling all relevant business applications to leverage the detailed and current canonical data through a streamlined services layer at speeds that support real-time operational use. The real-time component is key here; data lakes and data warehouses can make customer data accessible, but not at the cadence that a CDP does.

There is a substantial amount of confusion in the marketplace about what a CDP is and what the technology’s role should be within the enterprise. The reality, however, is that legacy data management solutions offer neither the flexibility, nor the accessibility of a CDP to unify customer data across channel-specific silos and manage a dynamically updated single, composite view of the customer. If you are in the market for a CDP, make sure you evaluate every possible solution on its agility, precision, scale, speed, and accessibility. Only solutions that meet those criteria can truly be said to be customer data platforms.


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