Why Customer Data Platforms Will Set You Up For Data-Driven Growth
Billy Loizou (main photo) is the VP go to market APAC at Cheetah Digital. In this guest post, Loizou offers expert tips to get the maximum out of your Customer Data Platforms…
In the past decade, first-party data has exploded. Marketers now have more first-party customer data than ever before, and it’s spread across more systems than ever before too. And expectations to deliver highly personalised experiences have also increased exponentially.
To help organisations make the best use of their customer data to drive success, in 2013 David Raab founded the Customer Data Platform (CDP) Institute, a vendor-neutral organisation with over 10,000 members
The original thought leader who coined the now popular term “CDP,” David spoke at the recent Cheetah Digital Signals21 panel, sharing the four key considerations he believes organisations need to make when identifying the role of a CDP to maximise its benefit and optimise privacy best practice.
What is a CDP? An expert definition
According to David, the formal CDP Institute definition of a customer data platform is, “packaged software that builds a persistent unified customer database that’s accessible to other systems.”
‘Packaged’ software means it’s something you ‘buy’, it is not a data warehouse or a data lake that you typically ‘build’ as a custom project.
“Unified persistent customer database has multiple components to it,” David says, “It’s unified as it takes in data from all sources. This means it doesn’t just work with some subset of data.”
A customer relationship management (CRM) system, for example, will work usually with the data the users have entered into the system, without usually importing data from other sources. A data management platform (DMP), traditionally works with cookies that get ‘thrown away’ after 60 or 90 days.
David says CDP has a unique combination of features which makes it the ideal platform.
“No one feature is absolutely unique only to the CDP, it is the combination that makes it different. The combination is there because It is designed to build those persistent, shareable profiles for all the other systems.
“Even though they’re excellent at what they do, they were designed for some other purpose and were therefore optimised for that purpose, which makes them not as good at doing what a CDP does,” David explains.
Getting smart about your CDP
There are two clusters of CDPs to “choose” from, David explains. The first is the CDP systems that focus on profile building and the second is the cluster of CDP systems that are targeted to marketing departments:
- Profile building CDPs: These involve vendors which tend to sell up into the enterprise, where the enterprise wants a unified customer profile that can be shared across the organisation including marketing, sales, service, support and operations.
- Marketing-targeted CDPs:These are the ones that have built-in campaign management and built-in predictive modelling and analytics.
David explains, “The vendors tend to fall in those two big buckets, the ones that are sold to marketing departments and those that are sold to mid-tier companies and big enterprises.
“If you do not understand CDP’s, think of them as two broad segments of the ones that focus on data and are more enterprise level. Versus the ones that are more for the marketing department and have a lot of marketing functions.”
David highly recommends organisations commit to some type of training when it comes to understanding their CDP better, to maximise the benefit of their martech investment.
“It’s important to train the users on the data that the CDP provides, what it’s suitable for and what it’s not suitable for. Predictive modelling scores are a good example of something that might be labelled one thing but often can be misused accidentally if you don’t understand what you are looking at,” David adds.
CDPs, privacy and data safety
With GDPR in Europe and CCPA in California, plus a plethora more privacy legislative instruments being passed globally, organisations increasingly have consumer privacy top of mind.
David says CDPs allow organisations to comply with GDPR, as effective implementation of a CDP in many ways overlaps with compliance requirements of privacy regulations.
“You have to find where all your customer data sits and you need that to deploy a CDP. You also have to do that to comply with privacy regulations, you have to be able to pull that data together and give someone a look at it,” he explains.
“For example, you have to be able to track all the processing that you’ve done. It is easy if you’re doing all your processing by pulling data out of the CDP. There’s a choke point to make sure that data is only pulled out for appropriate reasons, and you have to track consent. You need a place to store that consent, and a CDP is a perfect place to store that consent.”
The work organisations have to do to comply with privacy, essentially becomes the work that’s required to deploy a CDP.
“It makes sense for the CDP to be the system to do that, because beforehand companies typically didn’t have it all in one place,” David adds.
Building or buying a CDP?
Deciding whether to build or buy a CDP, David says that often organisations will actually do both as a ‘balance of two.’
“Even if you bought a package CDP and everything that goes on top of it in terms of what else would get built, the IT team will still need to connect the data to deploy that package CDP. This is effectively building the CDP in-house,” he says.
David says many corporate IT departments don’t have those resources to build a CDP from scratch. This is especially the case if they’re in an industry that does not traditionally work with customer data, and starting with the CDP is really not the ‘natural’ place the internal teams would go to when understanding customer data.
“It’s not black or white, but it’s simply a question of what’s the optimal use of my limited resources? There’s no point in starting to bite off more than you can chew. Departments want to build databases however there is more to it,” David adds.
CDPs are a crucial platform for organisations that help them understand and build a persistent unified customer database accessible to other systems. With two specific types of CDPS, profile building and marketing-targeted, these can ensure organisations get the most out of their data.
Latest News
The Mars Agency Announces Latest Findings Of Retail Media Report Card
The Mars Agency has developed a scorecard that assesses the capabilities of leading platforms across key criteria required to optimally plan, execute, and measure effective retail media programs. The scorecard aims To help brands efficiently evaluate their spending options across retail media networks in Australia (and New Zealand). With spending on retail media advertising in […]
‘It’s The Lesser Of Two Evils’ – NRL Eyes US Betting Market As Aussie Regulators Circle
US betting firms will be delighted by the circa 50,000 Americans who could soon watch the NRL on their favourite app.
A-League In Deep Discussions With New Partner To Keep Games On TV After Production Company Enters Administration
The A-League's insatiable appetite for scoring own goals continues.
TV Ratings (27/03/2024): Jungle Members At War Over Concealed Lipstick
A heated argument between two jungle members did the numbers for Ten last night, with I’m A Celeb obtaining a total national reach of 1,282,000. Fans were delighted as Candice Warner and influencer Skye Wheatley got into it over a stick of lipstick, leading Warner to dub the Instagram star “selfish.” Wheatley, best known for […]
Is The Australian Music Industry In Trouble? Inquiry Launched Following Splendour Cancellation
Earlier this week, an inquiry was launched into the challenges and opportunities currently facing the Australian live music industry in the wake of multiple festival cancellations. On 25 March 2024, the Minister for the Arts, the Hon. Tony Burke MP, asked the Committee on Communications and the Arts to inquire into and report on the […]
Liana Dubois, Leandro Perez, Aimee Buchanan & More Gather For Inaugural Compadres Leadership Event
Didn't get the invite? Perhaps you're not as important as you thought.
Cathay Captures The Unforgettable Thrill Of Cathay/HSBC Hong Kong Rugby Sevens, Via Publicis
Nobody does rugby like Hong Kong, apparently. Certainly nobody does it as badly as Australia.
Cocogun Nabs Christine Watts, Kirsty Reynolds & Shev Tan Bolstering Management & Creative Teams
Cocogun bolsters its team with new hires. Committed to purchasing a bigger sofa, too.
The Media Store’s Jacquie Alley & Sam Cousins Take The Plunge With Pro-Bono Work For Cure Cancer
B&T chats with The Media Store bosses about their great pro-bono work and sponsored swim.
Hawke’s Brewing Co. Taps Rocket Comms For PR Agency Following Competitive Pitch
We're expecting Rocket Comms productivity to crash in spectacular fashion following this win.
Spotlight On Sponsors: Patties Serves Up A Taste Of Home For Olympians & South Sydney Rabbitohs Recommit To Gambling Reform
While the Rabbitohs commits to gambling reform, B&T reckons the team should commit to a decent auto sponsor.
Google: “Inevitable” That Bad Actors Will Abuse Ads Platform As Advertiser Account Suspensions Double
Google maintains it's simply impossible for it to entirely stop bad people placing & paying for ads using its service.
Quantcast Expands APAC Sales Team With Appointment Of News Corp Account Manager
No pressure at all when you are appointed as a client success manager.
Publicis Sapient Tests Microsoft-Powered Gen AI Search Tool With Homes & Villas By Marriott Bonvoy
Given Gen AI's record for mangling stuff, B&T cannot see the problem with letting it decide your next holiday digs.
Volkswagen & DDB Group’s “Roo Badge” To Reduce Kangaroo Related Road Collisions
Watch out for RooBadge as Cannes Lions' most debated campaign this year.
Twilio Launches Unified Profiles & Agent Copilot Features To Boost Productivity & Engagement
Agent Copilot sounds like James Bond's less interesting cousin.
Reebok & Honda Among New Clients For onetwo agency
OneTwo finally lives up to its name with this double billing.
Ogilvy Report: Throw Out The Social Strategy Rule Book, The Rules Of The Past No Longer Apply
B&T was puzzled that all 'influencers' aren't, effectively, 'virtual', but here we are.
WhiteGREY & AKQA Merge In Australia, Lee Simpson Departs
Fortunately, the combined agencies aren't opting for a trite portmanteau for the new name.
Splendour In The Grass 2024 Music Festival Cancelled!
Music fans all over the country reportedly relieved they can pack away their rain coats and gumboots for another year.
TV Ratings (26/03/2024): “Fairy Bread, F***ing Disgusting”: Gordon Ramsay Slams Aussie Food In Food Stars Launch
Ramsay not one for mincing his words, even when it comes to minced meat pies.
Paramount+ International Boss Doubles Down On Aussie Content, Says Ad-Tier will Grow Audiences And Revenue
Good news as Paramount will not be binning I’m A Celebrity for re-runs of Frasier.
Brent Smart: Telstra Pushing For 50-50 Brand-Performance Split But Warns Numbers ‘Won’t Look Great’ Initially
The old brand vs performance debate continues. But here, Brent is firmly sitting on the fence.
Crowded House, Tones And I & Dom Dolla Win Big At The Shure Rolling Stone Music Awards
B&T staffer reports back with humdinger of a hangover & feeling seriously uncool after mixing with music types.
Opinion: Dyslexia “A Hidden Gem” For Brands & Agencies
Dyslexics offer underappreciated benefits in the corporate field, according to this op-ed.
David Jones Taps Criteo To Power Online Retail Media Arm
Want to see ads for things you probably can't afford? David Jones has got you covered with new retail media play.
oOh!media Sets Up Team To Target Business Audiences Across Airports & Offices
oOh! wants brands to harass you every minute of your next business trip.
QMS Launches Australian First DOOH & TV Partnership With Samba TV
Samba TV, of course, is not a channel dedicated to dancing. Much to our dismany.
Slew Of New Hires At Amplify
Four new faces join the Amplify offices. Team say desk scarcity becoming "acute".
Adobe Announces Content Authenticity Initiative Expansions To Counter Deep Fakes
Try as they might to enlighten them, we suspect Trump supporters will continue to watch and believe Fox News.
The PR Group Appoints TechCrunch Senior Reporter Catherine Shu As Director Of Content & Media
Catherine Shu makes the bold leap from journalism to PR. Says inevitable pay bump was "unrelated".
HERO Nabs Ebony Santin From AMPR
Rumours Santin cleared out the stationery cupboard before departing are as yet unconfirmed.
Karena Noble Checks Out Of EVT Hotels & Resorts To Launch Comms Consultancy
Noble still managed to squeezed in a continental breakfast before departing.
Canva Acquires Design Platform Affinity To Bring Professional Design Tools To Every Organisation
Canva & Adobe face off continues. We're not picking sides but keenly aware that Canva's office is next door to ours.
“Lean On Our Team To Help You Find An Audience”: Why Understanding Audience Engagement Is Essential In Journalism
Engaging the audience is critical to journos, apparently. We'd thought self-loathing & alcoholism were key.
Adobe Summit: Major Gen AI Developments, Data Concessions & Partnerships
What happens in Vegas stays there. Unless it's the Adobe Summit and then you get to read about in B&T.