What is a CDP? The Uses and Benefits of Customer Data Platforms

Michael Morgan
Chief Revenue Officier
May 2, 2024
May 3, 2024

Offering a personalized customer experience across every touchpoint is one way that modern marketers meet their goals. But personalization at scale is far from simple. It takes the right technology, which is why many marketers turn to a customer data platform (CDP).

What is a CDP? Customer Data Platform Definition

Customer data platforms are centralized databases used to aggregate and manage customer data. They ensure that each customer has a unified profile that includes information from all marketing channels. This might encompass demographics, customer behavior, and transactional data. The information can then be used to target and deliver messages at the right time and place for each customer. 

What Does a Customer Data Platform Do?

A customer data platform collects all the different kinds of data you have on your customers: campaign data, product data, real-time interaction data, customer support data and more. It uses software development kits and webhooks to connect with all of the data sources so that it can aggregate and use the data. 

From that aggregate data, it builds a unified customer profile for each customer. This process of identity resolution allows you to recognize that the user who clicked on your mobile ad is the same person who bought from you on a different device last week. 

The CDP cleans and validates the data and uses all sources to fill in any gaps. As customers take additional actions, the data is constantly updated to ensure each profile stays up to date. Advanced CDPs may incorporate machine learning and artificial intelligence to help you analyze and segment customer profiles. 

Benefits of A Customer Data Platform

Marketers choose customer data platforms because they want to be able to combine and use both structured and unstructured data. They may have data in multiple locations, including in customer relationship management software, on data management platforms, in email, on social media and in proprietary systems. They need to combine all of that data in a single tool that integrates with their existing martech stack.

With a marketing CDP data can be shared across the entire organization so sales, customer service, support and marketing teams are all working with the same, robust information. The data can also be fed into marketing automation software and personalization tools for segmenting, targeting, and retargeting.

All of those are useful functions. But there are a few functions CDPs just aren’t built to handle. 

Where CDPs Can Fall Short

Customer data platforms are really good at helping you understand and interact with existing customers and known prospects. They tend to be less useful when a visitor has not yet identified themselves by signing in or filling out a form. They may be great at keeping the customers you already have, but less helpful at converting anonymous visitors.

More than 90% of website visitors are anonymous. Heightened privacy restrictions and the loss of third-party cookies may drive this number even higher. These anonymous visitors might be new to your site, or they could be returning customers who didn’t log in. Either way, a CDP may not be able to include them in your data set. 

That’s a problem because it means that the vast majority of your website visitors might be getting a less tailored experience. If you try to retarget them on other channels, you may miss the mark. What you need is a way to identify these visitors. You need an audience identification tool.

Supercharge Your  CDP with Audience Identification

Ignite by Launch Labs gives you access to even more audience data. While a customer data platform only includes contacts who have already become customers, Ignite can identify and target individuals who haven’t yet given you data directly. One way it does this is by deanonymizing website traffic. 

When a visitor lands on your site, they’re prompted to share their location. As they move through the site, Ignite watches what they do and builds a profile that becomes part of your data. That means you can start customizing offers right away. No need to wait until the visitor fills out a form. 

A CDP can be a useful tool, but if you want to maximize leads and engage visitors immediately, you’ll need a few more tools in your toolbox. Ignite helps you identify anonymous visitors, making it easier to convert them into known leads and customers. 

To find out if  Ignite by Launch Labs is the audience identification platform you didn’t know you were looking for, schedule a demo today.

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