Recently, customer data has become one of the most valuable assets for eCommerce companies. It is at heart of marketing personalization, new products development and user experience improvement.
That’s why data-driven businesses strive to gather as much customer data as possible, including but not limited to a website, mobile app, social media, and in-store interactions.
But with so many data sources available, gathering, strutting, classifying, and analyzing it in a single place becomes more challenging.
A customer data platform resolves this challenge by providing businesses with a single environment for customer data gathering and analysis.
In this article, we will discover what a CDP is, what essential features it should have, and why it’s a must-have tool for eCommerce companies.
What Is A Customer Data Platform
A Customer Data Platform is a solution that helps businesses consolidate customer data in a single place.
After being integrated with multiple sources, like a business website, mobile app, email marketing platform, and in-store purchases, a CDP spots customers’ interactions across these channels, identifies each of the customers, and transfers this data to the system’s dashboard.
The latter is called a Single Customer View and can be considered a customer individual profile where all the interactions with the brand are stored, visualized, and analyzed.
With all these insights in the pocket, eCommerce businesses can use customer data to personalize their offerings, develop more targeted marketing campaigns and anticipate customers’ needs.
However, don’t mix up a customer data platform (CDP) and a customer relationship management system (CRM). The main difference between a CDP vs CRM is that a CRM in its simplest form, is just a client’s data storage.
A CDP, in addition to gathering and storing, also allows for analyzing data and creating omnichannel marketing campaigns based on that insights.
Customer Data Platform Features
Below are the must-have features of a customer data platform.
- Data collection. This is the core feature of a CDP since it should be able to collect customer data across multiple sources.
- Data integration. After customer data is collected, it should be integrated into a Single Customer View or unified customer profile.
- Data cleansing. A CDP should be able to clean and standardize customer data to ensure accuracy and consistency.
- Data enrichment. As for more advanced features of a customer data platform, there should be an opportunity to enrich customer data with additional information, like their behavioral patterns.
- Identity resolution. This is also one of the most important features of a customer data platform. Identity resolution means that a CDP should identify and merge customer profiles across multiple data sources, and then consolidate this information in a Single Customer View.
- Segmentation. A CDP should be able to segment customers based on various criteria, such as demographics, behaviors, and preferences. The more segmentation criteria a customer data platform has, the deeper customer-driven insights a business can get.
- Campaign management. Based on the custom users’ segments, a CDP should have the necessary functionality to develop, run and analyze targeted marketing campaigns.
- Integration with other systems. Perfectly, a customer data platform should also be integrated with other systems, like CRM, marketing automation, and analytics tools.
- Analytics. Last but not least, a CDP should come with advanced analytics features, visualized reporting, and pattern spotting.
In addition to the core features a powerful CDP should have, pay attention to its security, vendor support, and real-time data processing capabilities.
According to the 2022 State of CDP report, these are the most important factors companies pay attention to when choosing such a system.
Why Is CDP A Must For eCommerce
So, what are the benefits of using a CDP for an eCommerce business? Discover the most important ones below.
Personalization And Customization
A 360-degree view of the customers a CDP provides businesses with allows them to create and deliver custom-matched and deeply personalized experiences.
For example, an eCommerce company can suggest personalized product recommendations on its website or in an email newsletter, and share action-triggered promo codes in a mobile app.
So, with the help of a customer data platform an eCommerce business can better tailor their marketing messengers to its customers, growing its sales and revenue.
Improved Customer Retention And Loyalty
Marketing campaigns’ personalization and customization lead to better customer experience, and consequently, their retention and loyalty.
From this perspective, leveraging a CDP allows eCommerce companies to create targeted campaigns and promotions that resonate with their customers as deeply as possible.
For instance, predictive artificial intelligence allows for projecting customers’ migration from one segment to another and preventing churns.
Enchanted Marketing And Advertising Efforts
A customer data platform takes digital marketing efforts to the next level by automating them, capturing the audience with the right message at the right time, and providing insights into their customers’ responses to these campaigns.
In addition, it enables marketers to segment the company’s customers more accurately, identify VIP customers, for instance, and develop special communication strategies for them.
Better Data Management
A CDP provides businesses with centralized customer data storage, eliminating data silos and ensuring that all of data is accurate, up-to-date, and accessible in real-time.
With the help of a CDP, marketing, and sales teams can collaborate more effectively. What’s more, leveraging a customer data platform helps businesses stay better compliant with data privacy regulations.
Competitive Advantage
With the help of a customer data platform, an eCommerce business can improve its ability to understand the needs and pain points of its clients, adjusting its product or service offerings accordingly. Overall, a CDP can help eCommerce businesses to future-proof their data management and analytics capabilities, improve customer experiences, and stay ahead of the competition.
Conclusion
In conclusion, a customer data platform is a powerful tool for eCommerce businesses that want to improve their data management, analytics, and customer experiences.
By providing a centralized system for collecting, integrating, and managing customer data, a CDP can help businesses to eliminate data silos, improve data quality and accuracy, and drive growth with the help of recommendations and segmentation.
Additionally, a CDP can future-proof eCommerce businesses by providing a scalable and flexible solution for managing customer data and adapting to changing business needs.
