The first step to determining which customer data platform (CDP) will be the right fit for your organization is defining the key CDP use cases that will drive the most value for your organization.
Establishing CDP use cases up front will ensure you are looking at the right CDP platform and CDP vendor for your particular industry and applications, as well as help your company align internally around what goals, processes and outcomes will define success.
It is important to make sure there is a shared understanding across your organization as to what constitutes a customer data platform use case, and align everyone around that common definition. Without a shared understanding internally, there can be a lack of clarity around prioritization of CDP use case development. Ill-defined use cases lead to an oversimplified assessment of what is needed to achieve success. Balance is important too. In some cases, organizations focus too much on the technology and features within a software package, and not enough on what internal resources, skills, and modern agile processes are needed for success.
The process of getting buy-in and alignment across an organization cannot be understated in importance. Having the right executives involved in the early stages of customer data use case development ensures you can develop a proof-of-concept (PoC) pilot program. A simple pilot CDP use case that can be seen and understood by all stakeholders across a company will help to exemplify the value a customer data platform can provide.
What Is Your Pilot CDP Use Case?
A successful CDP pilot program can help prove value from your initial CDP efforts, and set your CDP initiatives up for success. Your pilot use case should be something that is intrinsic to your company’s needs. The most important thing to remember is to not bite off too much in the pilot. The program should be simple, executable, and easy to translate to multiple stakeholders with measurable ROI and value.
Top Customer Data Platform Use Cases
Regardless of your industry or particular needs, CDPs are extremely broad in application and can address many diverse customer data use cases. The following CDP use cases will give you a good idea on how to define your pilot use case, and plan your CDP roadmap for both short-term and long-term success. This will help you evolve data-driven processes across the entire organization as your company increases its digital maturity.
1. Data Integration and Management
This will be the primary use case for many companies who are considering adopting a CDP. The ability to collect data from various channels and systems is a core capability all CDPs should offer. The data a CDP ingests can be structured, unstructured or semi-structured, can be stored without modification, or it can be reformatted and unified to be used in data-driven marketing campaigns. A unified customer data foundation helps marketing, sales, and customer service teams provide personalized experiences that increase loyalty and lifetime value.
2. Single View of the Customer
CDPs are designed to be a centralized data foundation, and a single source of truth for customer data. CDPs ingest, cleanse, de-dupe, analyze, and sync customer data from across first, second, and third-party sources to create a single customer view. AI-powered identity resolution capabilities help fill in gaps in the process and ensure data is clean, accurate and reliable.
3. Identity Resolution
Identity resolution compiles data collected from across first, second-and-third-party sources and attributes it to a single customer identity. Some CDPs have integrated identity resolution technology into their overall product offering. Identity resolution helps enhance the value of CDPs by enriching customer profiles, and making clean, accurate customer data accessible across different business units.
4. Identify and Segment High-Value Audiences
It’s imperative that you understand your consumers and are able to remain relevant, especially when consumers spend more time online. A first-rate CDP will have prebuilt propensity models, so your marketers know in real time which customers are the most important, high-value, or likely to churn.
You can use a CDP to improve retargeting accuracy by connecting customer data with advertising data, creating optimized audience segments. Lookalike audiences are a staple of many advertising campaigns and programs, but they can be too broad and generic to be effective. Focusing your audiences down to multiple micro-audiences will allow the machine learning based lookalike algorithm to start with less noise and be able to find much more accurate audiences.
5. Personalize Customer Experiences
Personalization helps businesses create highly relevant experiences across the customer journey. Once segments and audiences are identified, marketing, sales, and customer service teams can tailor messaging that speak directly to target audiences, and delivered through the right channel, at the right time.
6. Data Privacy, Compliance, and Governance
Consumers demand more control over their data, and expect companies to provide them with the ability to manage consent. Add in new and evolving privacy regulations, and it’s clear that companies have work to do to ensure personal data is properly managed and used across the organization.
CDPs give IT and data teams more control over data management, with the ability to manage access controls and permissions across teams. CDPs can also integrate with consent management software, which allows data privacy preferences to be shared as part of a single customer view.
7. Artificial Intelligences and Advanced Analytics
Many CDP platforms come equipped with advanced analytics features, typically powered by AI, that give marketers an easy way to visualize, predict, and activate on customer behavior in near real time. Predictive analytics uses data, algorithms, and machine learning techniques to assign predictive scores to various user segments based on historical data – which can be used to determine next-best action, recommendations, or forecasting demand.
8. Marketing Automation
CDPs improve the efficacy and efficiency of your marketing operations. Marketing automation can typically make time-consuming activities like lead qualification and campaign creation much less onerous.
Some CDPs provide advanced artificial intelligence (AI) and machine learning (ML) tools to assist in automating marketing tasks. This could include next-best action recommendations, real-time campaign activations, and customer journey orchestration capabilities.
9. Improving Operational Efficiency
All industries are seeing budgets under increasing scrutiny. It is imperative that you are able to track the impact of your marketing spend, and forecast demand to meet consumers’ needs accurately. You need to know your return on investment, so you can allocate spend accordingly through each channel.
A strong customer data foundation foundation forms part of the blueprint for accurate attribution. This enables your business to track the impact of marketing efforts. And, if it is being tracked accurately, it makes forecasting more effective – which essentially means you can do more with less.
CDP Use Cases and the CDP RFP Process
Defining your primary CDP use cases will give you the information you need to do proper due diligence when evaluating customer data platform vendors.
While there are several popular use cases that CDPs deliver, starting with a pilot use case can help set your business up for success, and prove value across the business. Customer data platforms are extremely broad in application and can be used in dozens of ways. It all depends on what your needs are.