Demystifying the ‘How’ of Customer Data Platforms

In today’s business world, even large corporations can fall into decline, thanks to disruption from competitors, emerging technologies and changes in consumer behavior. Businesses that succeed adopt a fearless commitment to change, organize their business around their customers’ obsession and utilize data to effectively respond to market and consumer demands. It’s not news that this consumer-first mindset should carry over into a company’s digital presence, but knowing how to do that is a challenge many businesses face. The leaders in this space have had their priorities clear:

These priorities often center on getting a single view on customers across the enterprise, an idea that is not new. The single customer view has been a priority for CMOs since 2012, yet 80% have not yet achieved value. The Harvard Business Review has found that the single customer view remains one of the biggest challenges to customer experience management. The primary reason for that, I believe, it’s a moving target due to:

1. The pace of emerging technologies

2. The rate that new data points emerge

3. Shifting consumer expectations

In most of the cases, businesses already have many of the elements required for a single customer view in place. They are just silo-ed across the business. A way to achieve the single customer view is with a customer data platform (CDP). A CDP resides conceptually between existing data systems and existing marketing technologies. It consolidates and processes the data from existing systems, and then makes it available for marketing technologies. In most scenarios, implementing a CDP does not require the replacement of existing systems. It merely resides in an additional conceptual layer, and can be implemented without disturbing business functions. Unfortunately, it’s not as easy as cobbling data together and hoping for the best.

When considering the use of a CDP, solution leaders often face two main questions:

· Should we consider hosting CDP on the Cloud or on the premises? (After all, it is the customer data we are talking about here.)

· Should we build or buy? (Yes, the famous dilemma, yet again.)

While weighing in on the famous on-Cloud versus on-prem debate, I won’t bore you with staggering numbers around enterprise-wide Cloud adoption or attempt to alleviate all concerns regarding Cloud security. However, I would say that these are exaggerated fears that result in lost opportunity and inappropriate spending. Gartner reports that by 2025, 99% of all security breaches will be the fault of customers who fail to appropriately manage Cloud security controls, not the providers of the Cloud service. The challenge exists not in the security of the Cloud itself, but in the policies and technologies for security and control of the technology.

Once you get over the hurdle of convincing your organization that the Cloud is the way to go, the next question is whether your CDP should be a Cloud-agnostic or Cloud-native solution. That debate, in this case, is linked to the question: Should we build or buy? In a buy scenario, the landscape of vendors offering CDP solutions is expanding fast. In 2017, there were five vendors who offered a single customer view solution. In 2019, that number approached 100. Many vendors with services within the peripherals of use cases where a single customer view would be useful, are now expanding their products to offer a CDP as a solution on top of their existing CRM, tag management, analytics and personalization solutions. The increase in vendor solutions is creating a confusing landscape where it is hard to understand the positioning of the solutions, what use cases they can support, what are their security policies, and how liability for a data breach is handled, to name a few. Choosing a third-party solution requires due diligence beyond a use-case and requirements evaluation.

All that being said, ‘buy’ is totally a valid option if that aligns with the existing IT and marketing strategy of the company, assuming appropriate qualification is done on functional and non-functional factors. (This deserves a separate article of its own. However, CDP Institute provides a good vendor comparison for the interested ones.)

I get very excited on seeing how the Cloud ecosystem has evolved to support something like CDP by leveraging Cloud-native application frameworks. Don’t get me wrong — I am a big fan of Cloud-agnostic solutions, but in this case, I feel that leveraging Cloud-native offerings does more justice to security than many people assume. Here is an overview on how a CDP can leverage Cloud-native options with your choice of Cloud offerings:

I personally prefer leveraging the above frameworks as accelerators to get started, and quickly scale up an enterprise-wide CDP. But even though we now have potential answers to the two key questions above, we are not out of the woods yet. How do you go about actually configuring and building your CDP? Here are two key considerations in my opinion:

1. Take an E2E Customer Journey Lens: By mapping out the core customer journeys, we can understand how users interact with the business, what their goals and intentions are, and how successful they are in achieving their goals. Once we understand the journey, we can identify where the customer profile and data resides within our systems, then consolidate that information to inform our initial CDP requirements.
2. Think Product, Not Project: The world moves too fast for 9- to 18-month, big-bang project launches. By the time the big launch is ready, the initiative could have lost its effectiveness or worse, be completely irrelevant. Take a product approach that allows for a thin end-to-end slice of customer use cases and product features to get to market quickly. Learn from customer feedback and expand from there.

Written by:

Deepak Arora, VP Engineering, Publicis Sapient and Jakes Lamprecht, Director of Technology, Publicis Sapient