Are CDPs Living Up to Marketers’ Expectations?
Customer data platforms and other data solutions are the number one tech being implemented by enterprise companies right now. But while CDPs are at the top of every marketer’s wishlist, research suggests that CDPs are failing to live up to expectations.
For example, one study found that almost 75% of marketers think that technology has made personalization harder, not easier. Another survey found that data represents about 20% of all US marketing spend, with 63% of marketers saying their data-driven marketing budgets grew last year. And yet, 87% of marketers still say data is their company’s most underutilized asset.
So is data the answer? Are CDPs failing marketers? And is there anything we can do about it?
To address the root of the CDP problem, we need to understand some primary issues that marketers face when looking to implement a CDP:
CDPs are in their infancy
As a relatively young technology, CDPs are still finding their footing. This means the CDP market can be hard to understand. Ask 10 different CDP vendors and you’ll get 10 different answers about what a CDP can do. Every vendor frames the challenges they’re solving differently. As the market continues to shift and more CDP solutions continue to emerge, the marketer’s understanding of which problem a CDP is supposed to solve begins to blur. This confusion, misunderstanding, and unclear expectations are what set up a CDP partnership for failure.
Most CDPs are not solving the actual problem
Here’s an uncomfortable truth about the CDP market: The conversations are so focused on data, but data isn’t what’s keeping marketers up at night. Data isn’t the problem marketers are trying to solve.
Marketers are concerned with conversions, customer retention, and customer experience. While many marketers already have plenty of data at their fingertips, most don’t know how to use that data to drive actionable insights and run effective targeted campaigns. A CDP should not only give you access to your data, but also empower you to identify and reach your most engaged customers when, where, and how they prefer.
Having more data doesn’t automatically mean more conversions, higher customer engagement, or even effective personalization. Having centralized data on its own doesn’t solve marketing problems. Without insights, more data means more complication.
This is often the missing piece in conversations about what problems a CDP can and should solve for marketers. It’s also vital to the success of those same marketers’ goals.
There are multiple factors to consider in a CDP
Sure, the primary value proposition of a CDP is in unifying and centralizing your data. But there are other factors in play, too: How easily does it integrate with your existing technology? Can it identify each unique customer as the same individual across devices and channels? Does it enable omnichannel activation as well as multi-touch attribution and performance analysis?
To solve marketing goals, a CDP needs to be able to provide individual customers with the content that’s most relevant to them and most likely to encourage them to convert—and do so within the channel that works best for each individual. Any potential CDP partner needs to be assessed for marketing use cases to ensure success.
Don’t give up on CDPs just yet
The key to achieving the results you want with a CDP is to stay grounded in the problems you set out to solve: understanding individual customers better, truly personalizing their experiences, and driving real ROI with increased revenue, customer loyalty, higher customer lifetime values, and more.
This means when researching a CDP, marketers should be asking: Is it built to serve marketers and solve marketing problems? Does it fit my specific use cases? How does it support my business goals? What do I need to change about my processes, training, and marketing strategy to make it work? And is it smart enough to provide real insights into my customers and enable me to deliver true personalization across channels?
By considering these questions beforehand, marketers will be better equipped with a CDP solution that helps them work more efficiently and effectively for maximized results.