Modern retail consumers have many points of interaction with companies and therefore generate a significant amount of data, including social media, apps, websites, and store visits. However, with information being so fragmented, it is difficult for businesses to utilize it effectively.
Customer data platforms (CDPs) provide the ability to combine customer data, diminish objectivity, and develop personalization methods that accurately represent customer desires. Regardless of the client’s touchpoint, CDP platforms allow businesses to provide a consistent experience and comprehend user intent in real-time. They serve as a foundation for developing highly customized experiences, improving engagement, and raising conversion rates.
However, understanding the different types of CDPs and their uses is crucial for achieving these benefits.
6 Major Types of Customer Data Platform
The customer data management platform market is still in its growing stage and has a few overarching regulating authorities. Thus, there is a lack of consensus and uniformity amongst CDP platform firms and experts on the various classifications of CDP architectures. Although there are several methods to classify real-time customer data platforms, the majority will fit into one of the five groups organized based on their functionalities and uses.
1. Data Streaming CDP
Data streaming CDP platforms simplify resolving customer IDs by integrating and centralizing customer data. This helps to connect all the records of a customer’s interactions with the business across all the channels.
While streaming data collection and tag management are excellent uses for data streaming CDPs, they may lack some of the more marketing-focused campaign automation functionality found in other CDP types.
2. Automation CDP
The goal of automation CDPs is to make marketing campaign execution simpler. They excel at automating data segmentation, assembly, and marketing message distribution through a variety of channels, including email.
However, they are frequently not very good at integrating real-time data and making quick changes to messaging because they were typically designed based on a fixed workflow. This category can occasionally be further divided between CDP platforms that focus on automated actions, which automate marketing activities, and CDPs that focus on automated analytics, which focus on data analytics.
3. CDPs for Orchestrations
This type of CDP typically offers more capabilities designed to streamline contemporary marketing processes. They can be combined with data streaming CDPs, which provide them with real-time data that can be instantly incorporated into campaigns.
The orchestration customer data management platform type is highly beneficial for many businesses as it combines the convenience features of automated CDPs with the data ingestion and centralized capabilities of a data streaming CDP.
4. Packaged CDPs
It is a prebuilt customer data platform that is designed based on the features and functions that a company might possibly require from its CDP platform. They are usually quite simple to apply.
Most packaged CDPs are designed to be an “all-in-one” solution. Therefore, they frequently include a lot of features and capabilities that are not needed. This can bloat the software, making it slower and more challenging to use.
5. Composable CDPs
In many respects, a composable CDP is the reverse of a packaged customer data management platform. A composable CDP is usually “unbundled,” meaning it is made up of separate modules that a company can utilize or not, in contrast to a packaged CDP, which is pre-built and standardized. Additionally, a composed CDP fits directly on top of the current data architecture, removing the need for duplication and all of the problems it causes.
How to Choose a CDP Platform Type
The objectives and the technical proficiency of a business will determine the optimal CDP platform. Companies need to audit their existing position, establish marketing goals, and examine platform capabilities to select the best platform. They can create a CDP use case roadmap in order to choose a CDP by having a clear idea of:
- The main issue that a company is attempting to address.
- The technologies that are in use at the moment.
- Stakeholders who will use the CDP.
- The client data that they currently have access to, and what they require.
- Different marketing apps that can be powered by a customer data management platform.
- The ways to assess the effectiveness of CDP deployment.
Businesses should also take their technological budget into account when selecting a CDP. Two elements are directly related to the total cost:
- Features: how many features (such as event tracking, identity resolution, audiences, journeys, analytics, etc.) a company requires in a CDP platform.
- Data Volume: the total number of destinations a business delivers data to and the number of monthly tracked users (MTUs) that are kept in a CDP.
Bottom Line
A fragmented view of consumer data undermines related efforts and makes it more difficult for a business to deliver customized experiences. Businesses can close this gap by using the customer data management platform, which aggregates user data from all accessible sources. A thorough grasp of consumer behavior and requirements enables companies to choose the right CDP platform type and provide individualized experiences at each touchpoint.
Better identity resolution and more robust data privacy policies can be integrated into CDP solutions as technology develops to offer a customized experience that meets the needs of each user. Companies that understand the customer data platform types are able to handle the challenges of growing customer demands and customization, maintain client engagement, boost retention rates, and forge closer bonds with their clientele.
