Take control of your strategy with a Customer Data Platform for marketing.
Changes in technology, global markets and consumer behavior have contributed to a significant increase in the amount of hard data brands must manage. And with so much information comes great responsibility: how can a brand make sense of it all, find a way to cut through the noise, and reach its customers in a meaningful way?
For brands, this battle is mainly fought on two fronts: customer acquisition and customer retention. Although these are two very different strategies, they both rely on a brand's ability to engage with —and understand— its customers' habits.
Many businesses are turning to Customer Data Platforms (CDPs) to keep up with the changing times and find ways to improve customer engagement, retention, and loyalty. But, what exactly are the benefits of a CDP?
Customer Data Platforms are software platforms for marketing that collect customer data from multiple sources and build unified profiles of each customer. Once you've got all the information about your customers in one place, it's time to use it!
Find out more here: Customer Data Platforms: Your go-to solution to customer data challenges.
6 benefits of a CDP that will help you boost the effectiveness of your marketing campaigns.
Our team of Adobe experts have put together a list of 6 ways in which your company can benefit from the use of a Customer Data Platform for better, more effective marketing campaigns.
1. Independence from third-party cookies.
You might already be aware of the fact that Chrome is set to phase out third-party cookies by late 2023. Being the most popular desktop browser in the world, this decision has given rise to the so-called “cookiepocalypse”.
Among the benefits of a CDP, there's the fact that it will help you efficiently compile customer information. More especially first-party data. This will help you transition away from relying on outside sources such as third-party cookies, which are facing permanent blocks from big browsers like Firefox, Safari and Chrome.
But instead of seeing the lack of third-party cookies as a problem, consider it a challenge that could improve your data strategy. Indeed, using a Customer Data Platform for marketing is a fantastic way to jump-start your campaigns by being able to personalize every interaction that a potential customer has with your brand.
Think of it like this: what’s more reliable than data you collected yourself based on the parameters relevant to your brand? Few things are, and while third-party data offers the largest reach, it also offers the lowest quality data. Only you can collect brand-specific information like purchase history and the customer journey that leads to your touchpoints. CDPs allow you to collect and manage data to deliver better-targeted ads across your channels.
2. Powerful segmentation tools.
With the information CDPs provide, you can, for example, learn how to tweak your email marketing content and further personalize aspects such as fonts, colors, language, and headlines to adapt to each customer segment’s preferences.
But email marketing is not your only playground. You can use Personally Identifiable Information (PII) and cross-reference it with social media and website behavior to create segments of people looking for specific services or products and then target ads to those segments.
Additionally, a Customer Data Platform for marketing lets you segment your “premium” customers —the ones that spend the most on your brand, and should be treated with special priority at every touchpoint. For example, they should never be bombarded with excessive email offers since they already mostly know what they want from your brand and are willing to keep coming back for it, so targeted ads should be used judiciously.
Since the potential of CDPs for segmentation is very high, it's completely adjustable to your specific needs. Learning to manage its features to your advantage will be key to squeezing the most benefits out of them.
3. Increase your reach by managing multiple channels
But the benefits of a CDP don't stop there. Indeed, Customer Data Platforms for marketing can help you easily deploy omnichannel strategies.
Interestingly, a study by the Harvard Business Review determined that 73% of retail customers use multiple channels to make purchases. As for the remaining 27%, 7% are online-only shoppers, and 20% are store-only shoppers. Tapping into the omnichannel market is an effective way to reach the most potential customers.
A Customer Data Platform for marketing, combined with your team's knowledge and marketing tools, will allow you to come up with effective multi-channel campaigns that feel relevant to each and every one of your customers. Let's take a look at some of the benefits of embracing omnichannel strategies:
- Omnichannel customers are more valuable: The Harvard study mentioned above determined that omnichannel customers spent an average of 4% more in the store and 10% more online than single-channel customers.
- Connect online and offline experiences: If a customer buys a product offline and then calls customer support to help set it up, the support employee can see the customer’s journey by simply inputting their contact information. Contextual information helps brands provide a better customer experience.
- Reach more customer segments: You will cover the most ground by providing services on all possible channels. This is important, considering that a whopping 40% of customers say they won’t do business with companies if they can’t use their preferred channels, according to a Salesforce report.
- More efficient data collection: Omnichannel strategies allow you to collect customer information only once, and then it’s available on all channels instead of collecting it at every touchpoint.
4. Measure the success of strategies.
In modern marketing, everything needs to be backed up with data —and that’s exactly one of the benefits of a CDP. By being a hub of your customers’ data that also comes with comprehensive analytic tools, it becomes a tool to measure the success of your campaigns.
We all benefit from a single place to measure and compare metrics like brand awareness, customer engagement, conversion rate, click-through, and cost per lead, as well as other websites, SEO, and other more complex metrics. Customer Data Platforms for marketing provide the environment you need to obtain those metrics and the information needed to optimize them.
In marketing, you can only manage what you can measure, and CDPs give you many marketing efforts to measure.
5. Comply with privacy laws.
Privacy and the responsible use of data have become hot topics in the past few years. Depending on where you live or do business, complying with privacy rules might not just be a matter of ethics or etiquette but a legal consideration.
In this context, one of the benefits of a CDP is that it can become your main tool to make that data compliant with privacy laws such as GDPR and CCPA. In fact, according to the CDP Institute, these are the 6 ways in which CDPs are foundational privacy technologies for data catalogs and inventories:
- Data Catalog / Data Inventor: Traceability is a big component of privacy regulations, and feeding a CDP data to identify sources and destinations is known as “data inventory”, a key element of traceability.
- Unified data: Customer data is collected from multiple sources to create a unified profile that can be made available for access requests.
- Consent management: CDPs store information about consent for relevant pieces of data.
- Permission enforcement / Data policy enforcement: Having all customer data in one place, it becomes easier to determine whether all uses of said data comply with regulations and consent.
- Value delivery: Even if the data collected is compliant to privacy laws, customers want to receive value in exchange for providing valuable information. With the tools the CDP provides, this value can be delivered through marketing, customer service, operations, and other interactions.
- Security: In addition to providing built-in data security measures, the fact that all data is stored in a single database reduces the possibility of leaks by reducing the number of places in which the data must be protected.
6. Discard unnecessary information.
Customer data is an invaluable resource, but that doesn’t mean every single piece of data provides actionable insights. In fact, there is a name for metrics that don’t provide strategic value: vanity metrics. These statistics may look good on paper but don’t provide many benefits in practice, if any.
For example, you can have an email list of 10,000 people, and you know that only 50% of the people who open your emails ever click on a link inside of them. Does that mean you have 5,000 actual engaged subscribers? Not necessarily (and, most likely, it does not mean so).
According to WebFX, these are the 3 questions you can ask yourself when parsing through your CDP database to determine whether the data you are reading is actionable or just a vanity metric:
- Can they help you make business decisions?
- Can you recreate the results?
- Do they tell the whole picture?
That being said, don’t be shy about the numbers you’ve earned so far. Because you did earn them, but be aware of what the numbers mean for your bottom line and performance, not just how large or small they are.
A Customer Data Platform for marketing can help you determine which pieces of data are helping your brand convert interest into action and grow the revenue streams, and which pieces of data don't provide much of anything.
A world of possibilities.
What we discussed here only scratches the surface of all the benefits of a CDP. Diving into them and exploring their possibilities will help you become a better marketer and understand your customer base.
As your databases grow and your strategies become more sophisticated, the Customer Data Platform for marketing will become a scalable solution to visualize the entire customer journey, satisfy needs, increase engagement and retention and, more importantly, drive conversions.
In summary, the benefits of a CDP go beyond complementing your marketing knowledge —they reinforce it and help you become the marketer your customers want you to be. If your company is ready to invest in a Customer Data Platform for marketing, don't hesitate to reach out to us. At Conexio, helping brands to create meaningful connections with their customers is our bread and butter.
These were just some of the benefits of a CDP. You can check out the rest here:
