Data Lakes and Customer Data Platforms: A Win-Win for Marketing and IT


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We’re hurtling at warp speed to a time when customer experience will reign supreme. In fact, according to Walker, customer experience will supplant product and price as the key differentiator by 2020. In 2014, Gartner said in five years customer experience be how 89% of businesses differentiate. It’s 2019 – times up!

The buyer’s expectation is to have a friction-free customer experience, even as that experience spans an increasing array of channels and touchpoints that rely on complex back-end business operations from vendors. Coordinating all touches along the journey is known as delivering a unified customer experience.

And it starts with unified data, which helps explain why solutions that help unify data are top of mind. Two of those solutions are Data Lakes and up-and-coming Customer Data Platforms (CDPs). Our team is increasingly seeing enterprises that aren’t sure how these two technologies relate and differentiate. It’s a matter of understanding each and how to take advantage of them to best serve the enterprise.

The Shortcomings of Data Lakes

The best place to start when assessing technology is always with a defined use case.  Let’s take a look at some of the most common needs we hear from enterprise business teams.

A Data Lake can unify data, but it’s typically geared to serve enterprise-wide data and IT. In other words, it’s not tailored for the needs of go-to-market teams, like marketing and sales. Because it’s a repository for vast amounts of raw unstructured and structured data, a Data Lake can prove difficult to work with for those outside of IT.

They don’t include core capabilities needed to address business growth and the customer experience, like identity resolution or audience management tools. Yet these are essential for analyzing disparate customer and prospect data and combining them into a unified view.

Moreover, they lack out-of-the-box integrations with go-to-market systems and digital channels. Take the integrations for Snowflake – a leading cloud Data Lake. They do not integrate with the channels and solutions a marketer would need to run an effective campaign. Simply put, it’s challenging – and can be quite resource-intensive – adding new data sources and connecting new channels to a Data Lake, requiring coding and integration to enable new data feeds.

Since data is dumped into the lake without any up-front restructuring, resources are needed to apply advanced technologies to explore and gain insights from the data. This forces revenue teams to request data and reports from the IT department. Because these requests are not an IT priority, they often linger for weeks and sometimes months.

Go-to-market teams then have to prep the data for activation in its downstream systems – enriching and restructuring the data – such as validating email addresses and phone numbers – so it can be used effectively by sales and marketing.

This isn’t to deny the power of Data Lakes. They’re just not tuned to the needs of teams focused on driving revenue, customer engagement, and business operations. If the purpose of unifying data is to enable real-time decisions that help orchestrate a unified customer experience, then Data Lakes fall short. There’s no concept of creating – and easily acting upon – a single unified view of each customer in what is essentially a huge unstructured data repository.

Customer Data Platforms Become Clear Choice for B2B Go-to-Market Teams

That’s where CDPs come in. They make it possible for organizations to ingest and link customer and prospect data and all its detail from virtually any source – including third-party sources – in real time. As such, CDPs help unify siloed data around a customer view, yielding a persistent “golden record” of all knowable data about customers. Plus, CDPs make that record easily accessible on demand so marketers, sales, and revenue ops can ensure personalized and highly relevant customer interactions at every touchpoint.

No wonder Forrester predicts that 70% of B2B marketers will choose CDPs over data lakes in 2019.

As a system that creates a persistent, unified customer and prospect database accessible to other systems (as defined by the CDP Institute), a CDP better serves revenue teams. It’s a packaged platform that comes with prebuilt components and data models, enabling marketers and other business stakeholders to segment, analyze, and activate their data – no significant IT involvement required. In fact, go-to-market teams can easily share and activate data – and change or add system sources – without disrupting the CDP.

A Powerful Duo of Data Lakes + CDPs

Customer Data Platforms aren’t a replacement for Data Lakes. Instead, they’re a perfect complement to them. And, in many cases, enterprises already have – or need – both.

Both Data Lakes and CDPs are persistent stores implemented by IT that host customer data as part of big data infrastructure. But the similarities end there. IT-managed Data Lakes ingest enterprise-wide data – typically first-party data from internal sources – without altering the data form. On the other hand, marketer-managed CDPs unite first- and third-party data and enable a real-time flow of data into and out of the system.

With easy integrations to all channels along with built-in tools for even business users, a CDP makes it easy to view, pull, and analyze data and arrive at audience insights. Because of this – and the addition of third-party data – CDPs help enterprises improve their targeting and customer experiences. Moreover, easy channel integrations that yield net-new data pave the way for faster time to market and expanded customer reach.

In fact, Data Lakes are a key source of data for CDPs. At the same time, CDPs can help improve the quality and completeness of data in a Data Lake.

In essence, CDPs enable the alignment between revenue teams and IT when it comes to an enterprise’s data and technology ecosystem. While revenue teams can use CDPs to capitalize on data to drive business growth, IT teams can enjoy the benefits of CDPs and Data Lakes working in harmony to serve the business.

If you’re convinced your enterprise can benefit from a CDP, understand the pros and cons when it comes to building or buying one. And then download the Innovator’s Guide to B2B Customer Data Platforms – written by David Raab, founder of the Customer Data Platform Institute – and learn how to capture, unify, and activate scattered data.

Republished with author's permission from original post.

John Hurley
Modern marketing leader defining a new category of enterprise technology. Startup mentor, former founder, and life-long marketer. Joined Radius founding team 6+ years ago.


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