CDP – Yet Another Platform? Or the True Path to Omnichannel Customer Experience? [5 Reading Tips]

CDP, platform, customer data, customer experience, omnichannel
Photo by Ashley Jurius on Unsplash

Data is the gold of the digital age. Whether sales, marketing or service – no successful digital business without data. The collection, processing and analysis of all types of data, especially customer data, therefore plays a key role in many companies to break down data silos, drive omnichannel marketing forward and ultimately obtain a 360-degree view of the customer. Behind all these activities is the well-known mission – but also challenge – of creating a personalised customer experience across all devices and all channels.

The creation, spread and use of digital platforms are logical and necessary consequences to turn these visions into reality. Its major advantage is the direct data exchange between all parties involved (companies and customers, but also partners and employees) via the platform itself. To use data effectively and achieve real competitive advantages, however, it is not sufficient to only collect huge amounts of data. Whether ERP, PIM, MDM or CRM – an effective system is required to be able to structure, connect and analyse data. Real time is the keyword of the moment. It is becoming increasingly relevant as customers expect unique and individual experiences quickly, anytime and anywhere. Companies have to react to these expectations and find their single source of truth which, based on robust data, helps them better understand their customers and address them appropriately.

But despite all the possibilities and a variety of providers, systems and solutions, the one perfect tool does not yet seem to exist. Data silos persist. In the context of customer relationship management, a 360-degree view of the customer is too often still theory rather than practice. For this reason, software providers are working on a new solution that is to connect the remaining loose ends completely and cleanly. We are talking about customer data platforms (in short: CDPs). Which role do CDPs play in a crowded system landscape? What distinguishes them from other systems such as CRM? Which development stage are CDPs currently in? Who are the most important providers? We answer these questions today.

CDP – Which Role Does This Solution Play?

David Raab is the founder of the American Customer Data Platform Institute and coined the term CDP for the first time. Raab describes customer data platforms as follows:

» A customer data platform is a marketer-managed system that creates a persistent, unified customer database that is accessible to other systems. «

CDPs thus create customer profiles through the integration of data from a variety of primary, secondary and third-party sources. This includes a CRM system and a data warehouse, transaction systems, web forms, e-mail and social media activities, website and e-commerce behaviour data and much more. This means that data silos can (finally) be broken down and a 360-degree view of the customer can be obtained.

An Overview of the CDP Market and Providers

With such promises, it comes as no surprise that the CDP market is on an upward trend and that the list of specialised software providers is constantly growing. There is thus no lack of choice.

According to the most recent study of the CDP Institute, the CDP market reached a turnover of one billion dollars with 14 new providers in 2019. These CDP providers all offer the following functionalities: collecting data, standardising profiles, segmenting and activating data. Selligent or TEALIUM are two of the solutions that are already available.

Huge software companies are also interested in this market. Adobe and Microsoft launched »real CDPs« onto the market last year. Salesforce has been working on a powerful solution for some time, has acquired companies such as Gigya, Mulesoft and Evergage, and has always dedicated a slot to this topic on the renowned Dreamforce. However, there have not been any reliable results so far. Experts assume that a pilot implementation will take place soon. SAP will also present its progress later this year. Up to now, its Customer Data Cloud works more like an ERP.


But of course, some questions arise in this context: yet another solution? Does the CDP replace one of the other existing systems, for example the CRM system? Do a CDP and a CRM system have the same functions? Are there huge differences between these two systems?

Overall, the only thing both systems have in common is that they collect customer data and offer added value to companies. Huge differences lie in the type of data they collect and the purpose it is used for:

  • CDPs track both online and offline customer data while CRM systems cannot access offline data unless it is entered manually.
  • CDPs collect data on anonymous visitors while CRM systems only report on known or potential customers.
  • CDPs independently create consistent customer profiles with data collected through a variety of online and offline channels while CRM systems only track a customer’s intentional interactions with a company through manual input.
  • CDPs lower the probability of data being duplicated or lost. As opposed to CDPs, CRM systems increase the risk of data loss and/or the error rate when storing data.

CDP – A Middleware for a True 360-Degree View of the Customer

A CDP is therefore neither a CRM system nor a data warehouse. A CDP does not necessarily replace these systems either, but sees itself as a middleware between all data silos in a company. Is/Will it be the final solution to implement a true omnichannel marketing strategy, to break down data silos and to ultimately create a personalised customer experience across all devices and channels?

CRM, white paper, cta

Find out more about the power of customer data in our current »Selecting Customer Relationship Management Software – CRM Providers and Systems Compared« white paper. Besides a variety of concrete use cases for B2C and B2B, the guide also includes up-to-date figures and facts on CRM as a single point of truth, the on-premise vs. cloud benchmark as well as the recently added AI chapter.

Exclusively for retailers, manufacturers and publishers, the white paper can be downloaded for free here.

Our 5 Reading Tips Of The Week

What’s Under the Hood of a Customer Data Platform? [CMSWire]

Why Customer Data Platforms will play a role in a Post-Third-Party cookie world [Adage]

Medibank pilots Salesforce’s customer data platform [IT-News]

CRM-Studie: Was erfolgreiches Customer Relationship Management braucht [One-to-One]

CRM-Suite erweitert [IT-Zoom]

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