CDPs are the New Destination for Data
Customer Data Platforms are more than just databases. They offer immense flexibility for almost all data use-cases.
Data is on everyone’s minds these days. From retailers looking to find new ways to connect the dots on customer experience to enterprise organizations looking to improve productivity, safety, and efficiency, data is viewed as the magic key to unlocking a more prosperous future for all. But data alone won’t help, it’s the insights found within the data that will — and those can be extremely difficult to parse out.
For most organizations, access to data isn’t the issue anymore. The issue is having too much data and being uncertain about what to do with it all. That’s where a Customer Data Platform (CDP) comes in. A well-implemented CDP can help tackle those data challenges and brings a host of additional capabilities that drive real value for an organization. CDPs are becoming a crucial difference-maker for companies truly looking to harness the power of their data. That’s why, if there is a magic key, it’s a CDP.
Data matters to the entire organization.
With high-quality data insights, everything from end-user brand experiences to behind-the-scenes employee tools can be impacted for the better. But maintaining quality data can be cumbersome and expensive, and many organizations are trying to accomplish this with insufficient tools for the task.
Traditionally, data pipelines are created to transport raw data from software platforms and other data sources to data warehouses for use by analytics or business intelligence tools. The process of creating one is often tedious: developers and data engineers write code manually as well as ensure the pipelines interface smoothly and without error at the points of connection. Additional factors, such as the rate of throughput (the amount of data that can be processed for a given unit of time), reliability & fault-tolerance (ensure the pipeline runs smoothly without errors, and protect, quickly recover, and restore data in the event of an error), and latency also need to be considered in the data pipeline architecture.
All that means data engineers and developers spend exorbitant amounts of effort and time not only to create the initial pipeline, but also to maintain it. Managing your data with a CDP takes away the headaches of manually creating and maintaining data pipelines. Plus, CDPs offer a few key improvements in functionality, as well.
For example, CDPs offer enhanced data protocols to ensure data quality at the point of ingestion. Duplicate data is very common when organizations use multiple platforms across various channels. Unsurprisingly, there’s considerable overlap among certain pieces of information (e.g., the same customer profile is split into two different profiles: mobileID and customerID).
While stringent data entry practices and/or automation for specific pairs of the same piece of data can remedy the pains of duplication, these solutions are often not scalable or cost-effective. But most CDPs have a built-in service that effectively drops duplicates as they come in by storing large amounts of data in memory for a period of time, and then performing computations at blazing high speeds to detect and eliminate the duplicate data, effectively eliminating the problem.
There are other data governance advantages to CDPs as well. Many of them offer an automated QA process for diagnosing data quality at the point of ingestion, allowing for a standardization of incoming and outgoing data. The current way of doing this — manually testing data validation code — is time consuming and doesn’t always catch all the errors. With a CDP, tools to verify quality data come built in.
Tracking plans are a great example of this. Tracking plans ensure alignment and establish a central source of truth for product, engineering, analytics, and business teams, making them a crucial part of your data governance strategy. With a CDP like Segment, one of the market leading CDPs, you get a tracking plan built in that helps clarify what events to track, where those events need to go in the code base, and why those events are necessary from a business perspective.
This is important because it helps create a level of data standardization that enables an ease of integration on both sides. That means not only does the CDP maintain quality data, but it also sets data up to be sent elsewhere, like a centralized dashboard, easily. And when data is centralized, you get a single source of truth for the entire organization that reduces organizational friction and puts everyone on the same page, enabling teams to focus on faster implementations rather than cross-team alignment activities.
Of course, it’s not only cross-team where friction can crop up. Siloed data can impact customer experiences within the same department, too. A standard promotional campaign run by a marketing department might send offers out via various digital channels — social media, email, mobile app, etc — and if these systems aren’t connected to one another, customers may receive a different offer in each channel, creating confusion and eroding customer trust. A CDP can help prevent these issues, too.
Deriving meaningful insights from data is entirely dependent on the quality of the data you’re using. If you’re getting duplicated information, or ‘bad data’ of any kind, your insights will be meaningless and can lead you to develop the exact wrong solutions for the challenges you’re facing. Right now, data specialists are overburdened while the rest of the organization lacks crucial insights for improving experiences. With a CDP, the entire organization reaps the benefits of high-quality, easily accessed data.
CDPs are core to data-driven UX design.
Understanding user behaviour is the central goal of all design research, and that understanding has always been grounded in data. Traditionally, an enormous amount of manual labour has gone into gathering the data — surveys, interviews, and an immense amount of 3rd party research — and synthesizing it, all to try to arrive at “best fit” personas to design for. We firmly believe more and better data will let us make better design decisions, gauge the effectiveness of our experiences, and deliver something which is truly unique and optimized, but to get there we need to go beyond the traditional method.
User expectations are evolving rapidly. No longer limited to one channel or device type for an experience, users expect an omnichannel approach that integrates seamlessly across devices, technology types, and even locations. That requires deep insights into how users engage with the various form factors and experiences on offer. To create compelling multi-modal experiences, we’re reliant on knowledge of user interactions over many form factors and properties.
Which brings us to the core problem: without direct access to data across all functions of an organization, designers and product managers must invest considerable time and resources to understand the success of a campaign or design because traditionally, the data for each of those interactions is siloed. At scale, the amount of manual effort required to overcome these silos quickly becomes untenable. You simply cannot access the necessary information contained within the data when it’s separated out across so many disparate instances, meaning you can’t get the complete picture of the user experience you need.
CDPs can give us direct metrics and insights so we base our decisions more on large volumes of real user engagement data and less on our own interpretations of a much more limited data set. The traditional model still holds value, user interviews provide meaningful context and information that numbers on a page never could, but CDPs allow us to dive deeper and be more successful using big data alongside those traditional approaches.
By bringing all your data together under one banner, breaking down silos, and giving your business the ability to act on data specific to designing for user behaviour, you’re able to create more personalized experiences that can drive conversions. You can act on user behaviour from one platform and modify content, send notifications or emails, notify stores about possible user preferences, and a plethora of other possibilities on another, enabled by the realtime, customer-centric, action-oriented nature of CDPs.
A CDP can help take the guesswork out of determining which data to use, and that enables your design practices to deliver a better UX every time.
CDPs democratize and offload data work
When getting started with data, the solution for many organizations has been to establish a new function within the organization: hire a data specialist and get out of their way. And while you certainly need expertise to make the most of your data, that’s not a sustainable long-term strategy — nor is it one that will produce best results. To get the most out of your data, you need to move away from the idea that it’s the responsibility of just a single function or team. Your whole organization needs to have access to and grounding in at least the basics of data.
CDPs are perfect for creating org-wide access to data. The nature of these platforms is that they are geared towards non-technical users, like marketers,, so once the integrations are set up, brands can quickly iterate experiments that correspond to tangible business outcomes. Marketing teams could set rules and build out campaigns, metrics, and new functionality without the need for technical input from a data specialist. Instead of one person holding the keys to all the information and needing to make meaning of it for each department, a CDP makes the information digestible for a broad cross-section of people and allows teams to make meaning of directly.
Because they offer a single source of truth for data that all functions can get behind (no more misalignment on key data metrics!), they provide a more desirable working experience for both technical and non-technical users that allows the focus to be shifted on creative and business-driven outcomes, rather than development implementation.
CDPs offer a flexible data solution
Data pipelines are costly. Prior to CDPs, the level of data integration and functionality they offer was only available through immense custom development work. With CDPs, those costs can now be put towards building out desired functionalities, which can drive marketing and organizational decisions. More money to put into marketing and campaigns, more focused business metrics to demonstrate ROI, more detailed usability reports and testing for product managers… CDPs can have profound effects on your operations.
That’s because they’re more than just a highly performant database. From in-the-moment web personalization and cross-channel digital experience orchestration, to up-to-the-minute business intelligence and accurate real-time marketing attribution, CDPs are becoming the next big thing in data discussions. But it’s not just the use cases and the quality of the data itself, CDPs fundamentally affect how cross-functional teams can collaborate. With the right CDP in place, you can reshape your organization.
Interested in how your organization can take advantage of all the benefits of a CDP? Talk to our team today.