The buzz about customer data platforms (CDPs) is only getting louder as e-commerce matures and consumers expect even more out of brands online. That makes the functionality of CDPs even more integral in today’s digital-first world.
The Customer Data Platform Institute defines a CDP as “packaged software that creates a persistent, unified customer database that is accessible to other systems.” One of the key differentiators of a CDP from customer relationship management software or other systems that work with customer data is that marketers — not IT professionals — are the ones using CDPs on a daily basis.
A customer data platform should simply integrate with your existing data and facilitate easy retrieval of your stored data for marketing campaigns. It should also collect first-party customer data from different sources and link that information to specific customers in the database — this creates a single customer view, which can then be used to set up and execute campaigns and analyze their performance.
The CDP marketplace — which is around 15+ years old at this point — has slowly shifted away from traditional monoliths with closed architectures. It has matured to meet the unique demands of those working in e-commerce to serve customers online. And as modern technology evolves everywhere, companies have learned they must take advantage of what the MACH Alliance Manifesto states are the “innovative and flexible technologies available.”
That means just as it is across the SaaS marketplace, it’s time to advocate for open and best-of-breed technologies in the CDP market as well.
Why Do Companies Need a Customer Data Platform?
The reason why your company needs a customer data platform in today’s market is simple: Customers are demanding personalized experiences from your brand.
Consider these statistics from McKinsey:
76% of consumers become frustrated when they don’t get a personalized experience
78% of consumers are more likely to make a repeat purchase with a brand that personalized their online shopping experience
76% of consumers are more likely to consider purchasing from companies that use e-commerce personalization strategies
Those statistics show that customers shopping online today want companies to compliantly use their data to personalize the experience. It saves the customer time and makes their shopping experience with a brand a much more enjoyable one.
But it isn’t just on-site personalization that customers want. They also want personalized email communications, which has resulted in the SaaS market looking more to customer data platforms to create and properly segment email marketing campaigns.
Companies have started shifting away from traditional email service providers (ESPs) to CDPs as they’ve realized the power of their customer data when it comes to properly segmenting and personalizing email campaigns. The right CDP will allow you to use your customer data to segment audiences and then personalize your emails to be as relevant to your audience as possible.
A customer data platform also allows for the personalization of other aspects of the customer journey. The modern customer wants to be reached on the channel that best suits them, not the one that best suits your company. That means the importance of omnichannel campaigns has skyrocketed, and a CDP is crucial in getting you the data you need to understand where and when to connect with customers for those campaigns.
The Benefits of a MACH-compliant Customer Data Platform
Why does having a MACH-compliant customer data platform matter to you?
If businesses want to truly capitalize on the promises they make customers with personalization, they need a powerful ecosystem of technology powering that venture. Not only that, but they also need to have the freedom to build that ecosystem in a way that makes sense internally.
The fact is, this type of ecosystem operates best with a MACH-compliant CDP collecting real-time customer data for use in marketing automation campaigns.
A MACH-compliant CDP allows your company to use real-time customer data to offer personalized experiences with your brand that are unmatched, whether it’s personalized email marketing, on-site product recommendations, or SMS campaigns.
The specific advantages of a MACH-compliant CDP are:
Microservices architecture: There is more to developing a microservices architecture than simply breaking up the monolithic commerce software application into a collection of smaller services. To fully realize the benefits of this modern app-development methodology, it’s essential to optimize the data layer, especially if you want to personalize across all channels. You need to consider how your data is managed, build interservice communication, and synchronize that data. MACH-compliant services also allow you to extend your CDP with additional features provided by other MACH solutions (e.g., content generation, custom recommendations engines tailored to your needs, or even advanced solutions creating modern conversational services).
APIs and webhooks: To be able to activate data from a CDP, you could look at three main purposes:
Front-end — Use the APIs to quickly retrieve all the information you have about your visitors and customers, as well as all the insight your CDP created, then use this data for building forms, weblayers, and truly personalized content in a headless way. Retrieve relevant product recommendations and tailor offers based on the customer’s most recent behavior.
Sending communications — API endpoints for all channels (web, email, SMS, mobile push, etc.).
Receiving data — Use APIs and webhooks to delegate endpoints for processing. Using webhooks, you can get access to actionable customer data in real time, and customer segmentation allows companies to ensure every customer receives relevant marketing communications.
Cloud-native SaaS: With an on-premise solution, the process of passing customer data to the CDP has become overly complex in terms of authentication and performance. You can operate at an advantage with cloud-native SaaS CDP for several reasons:
Features and integrations can be added multiple times per year.
Regular updates can be deployed on a weekly or biweekly basis, and critical fixes are deployed as soon as possible.
No downtime while updating.
There is only a single version, meaning all clients receive the latest version — fully supported.
It’s very easy to pass customer data points to other pieces of software in your technology stack. With legacy solutions, they may only have the option of importing or exporting files (and not in real time), which can lead to your customers receiving irrelevant or outdated marketing messages.
Headless: To activate the data in an omnichannel e-commerce environment, it’s critical to have the APIs be able to interact with both your front end and all your other channels (email, SMS, WhatsApp, social, etc.).
A MACH-compliant CDP offers the agility required to keep pace with rising customer demands thanks to the personalization offerings accessible from a truly open architecture.
The future is MACH-compliant personalized experiences — how will your company offer them to your customers?
