What is a CDP in Marketing?

What is a Customer Data Platform (CDP)?

A customer data platform (CDP) is a marketing technology that collects customer data from various sources, links the data to create unified customer profiles, and makes the data accessible to other systems.

CDPs create a persistent, unified customer database that is accessible to other systems via customer data APIs. They consolidate customer data from disparate sources like your website, mobile apps, CRM, email systems, and more. The CDP then matches customer data to create a single customer view based on people’s identities.

This unified customer profile contains every interaction a customer has with your brand across channels. It compiles demographic, behavioral, and contextual data into one record for each customer. The CDP segments these customer profiles based on attributes to create targeted audiences. These audiences can then be activated across channels.

The key difference between a CDP and CRM is that the CDP is focused on collecting, unifying and segmenting customer data for marketing purposes. A CRM manages customer relationships and sales processes. While CRMs may have analytics features, they don’t consolidate customer data from as many sources as a CDP.

In summary, CDPs create complete pictures of customers from all available data and make this unified customer data accessible for marketing campaigns and personalization. They are a foundational component of modern marketing technology stacks.

How Do CDPs Work?

Customer data platforms (CDPs) are built to unify customer data from disparate sources and create unified customer profiles. This enables much more effective segmentation and targeting.

CDPs ingest data from various sources like your CRM, website, mobile apps, email systems, and more. They use identity resolution to stitch together data on the same customers from different systems into unified profiles with a single customer ID.

These unified profiles contain demographic, behavioral, and transactional attributes on each customer. CDPs then allow you to segment users based on these attributes and behaviors, such as:

• Demographics – Age, gender, location
• Behavioral – Site activities, purchases, content views
• Transactional – Purchase history, lifetime value, churn risk

Once audiences are defined, CDPs activate them by integrating with your marketing systems for targeting. For example, sharing segments with your email marketing platform to send personalized campaigns. Or syncing audiences to your DMP for more relevant ad targeting.

By ingesting data, unifying profiles, defining audiences, and activating them, CDPs give marketers a powerful way to collect customer data and use it to deliver personalized experiences across channels.

Benefits of CDPs for Marketers

Customer Data Platforms offer several key benefits for marketers looking to better understand and engage customers across channels:

Centralized View of Customer Data

One of the main advantages of a CDP is bringing together customer data from disparate sources into a unified profile view. This includes data from your CRM, website, mobile apps, email systems, and more. With a centralized and complete view of each customer, marketers gain powerful insights to craft more relevant messaging and experiences.

More Personalized Marketing

By consolidating data into unified profiles, CDPs enable marketers to segment audiences and deliver personalized content and recommendations. You can identify behaviors and attributes to define micro-segments and tailor messaging to resonate better with different customer groups.

Omnichannel Coordination

CDPs also help coordinate customer experiences and journeys across channels. You can track engagement from email, web, mobile, social, and more to understand the full picture. This omnichannel view allows you to create consistent messaging and optimize touchpoints across channels.

Improved Attribution and ROI Measurement

With a CDP, marketers gain visibility into the customer journey to better attribute conversions across channels. This helps accurately measure campaign ROI and optimize marketing spend. You can see which campaigns and channels influence customer behavior and drive business results.

Implementing a CDP Strategy

Implementing a customer data platform requires careful planning and execution to realize the full benefits. Here are some best practices to consider:

Steps for Evaluating and Selecting a CDP

• Assemble a cross-functional team to define your goals and requirements. Include stakeholders from IT, marketing, sales, and customer service.
• Research CDP vendors and create a shortlist of platforms that meet your needs. Look for robust segmentation, integration capabilities, and AI-powered insights.
• Request demos and pricing from shortlisted vendors. Ask detailed questions about functionality, scalability, and implementation services.
• Thoroughly evaluate security, privacy compliance, and governance features. Data responsibility should be a top priority.
• Start with a limited pilot before committing to a broader rollout. Test integration and measure performance.

Integrating the CDP with Existing Martech Stack

• Audit your existing marketing, sales, and CRM systems. Identify key data inputs and outputs for the CDP.
• Work closely with IT teams and the CDP vendor on API connections and data pipelines. Prioritize critical systems first.
• Develop a data governance framework for managing consent, access controls, and ethical data use across systems.
• Create a long-term integration roadmap to maximize the CDP capabilities over time. Plan for future marketing stack expansion.