If your business leverages digital marketing to promote your business and drive customer retention and acquisition strategies, then you’ll know that one of the key benefits of digital marketing is its ability to reach a large, highly-targeted audience at a relatively low cost.
In contrast to traditional forms of advertising, such as print or television, digital marketing can be highly targeted, allowing marketers to reach specific audiences based on factors like location, demographics, and online behaviour.
But with increasing concerns around data and consumer privacy, access to the 3d party that has made targeting audiences through digital channels possible has become harder to leverage; Digital marketers need to find ways to leverage their own data more effectively.
A customer data platform (CDP) collects, integrates, and manages customer data from multiple sources in a single, unified repository. This data can then be used for acquisition and or to drive customer retention.
Why is Customer Retention so Important
Customer retention is crucial for businesses as it is more cost-effective to retain existing customers than to acquire new ones. A customer data platform (CDP) can play a significant role in improving customer retention by centralising all customer data into one unified system. This allows businesses to better understand their customers, personalise their interactions and experiences, and track customer behavior over time.
Here are some ways you can use a CDP to drive better digital customer retention and acquisition strategies:
Personalisation: By integrating customer data from various sources, a CDP can provide a complete view of each individual customer, allowing you to personalise your marketing messages and experiences for each person.
Segmentation: A CDP can help you segment your customer data based on various criteria, such as behaviour, demographics, and purchase history, enabling you to target your marketing efforts more effectively.
Analysing customer journeys: By tracking customer interactions and behaviours across multiple channels, a CDP can help you understand how customers interact with your brand and identify areas for improvement.
Improving the accuracy of your data: A CDP can help you identify and remove duplicates and inconsistencies in your customer data, ensuring that you have accurate, up-to-date information to inform your marketing efforts.
Driving cross-channel marketing: By integrating data from multiple sources, a CDP can help you track customer interactions across multiple channels and devices, enabling you to coordinate your marketing efforts and deliver a consistent, seamless customer experience.
Measuring the impact of your marketing efforts: A CDP can provide you with insights into the impact of your marketing efforts by tracking conversions and measuring the return on investment (ROI) of your campaigns.
When to invest in a CDP
You should consider investing in a customer data platform (CDP) when your business has reached a point where you need to better manage, understand, and use customer data to drive your marketing efforts at scale. Some common scenarios where a CDP may be useful include:
There are multiple data sources: If you have customer data from multiple sources, such as your website, CRM, and marketing automation tools, a CDP can help you integrate and consolidate this data into a single, unified repository.
A constant struggle with personalisation: If you find it difficult to personalise your marketing efforts based on customer data, a CDP can help you better understand and target individual customer segments.
An ineffective customer data management process: If you need help keeping your customer data up-to-date and accurate, a CDP can help you manage your customer data more effectively, reducing duplicates and improving the quality of your data.
You are trying to connect online and offline sales data: If you have physical stores and struggle to link in-store purchases to online customer journeys, CDP can help join the dots and drive a more accurate and complete customer journey.
By buying a CDP at the right time, you can ensure that you get the most out of your investment and that you can drive better results for your business. However, it’s important to research and evaluates your specific needs and requirements before making a decision, as a CDP may not be necessary or appropriate for all businesses.
What should I consider when buying a CDP
When buying a customer data platform (CDP), there are several factors you should consider to ensure you choose the right solution for your business:
Data Integration: Consider how well the CDP integrates with your existing marketing and analytics tools, as well as your data sources. Look for a solution that can easily import and integrate customer data from various sources, such as your website, CRM, and marketing automation tools.
Data Management: Evaluate the CDP’s data management capabilities, such as its ability to clean, deduplicate, and standardise customer data. You want a solution that can help you maintain accurate and up-to-date customer data over time.
Segmentation and Personalisation: Consider how well the CDP supports segmentation and personalisation, as these are key benefits of using a CDP. Look for a solution that enables you to create targeted, personalised campaigns based on customer behaviour and attributes.
Privacy and Security: Ensure that the CDP has robust privacy and security features to protect your customer data. Look for a solution that adheres to industry standards and regulations, such as the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA).
Scalability and Flexibility: Consider the scalability and flexibility of the CDP. Look for a solution that can grow and adapt as your business expands and support changes to your data structure, data sources, and marketing requirements.
User Experience: Evaluate the user experience of the CDP, including the interface and navigation, reporting and analytics capabilities, and the ability to integrate with other tools. You want a solution that is easy to use and provides the insights and data you need to make informed decisions about your marketing.
Cost: Consider the total cost of ownership of the CDP, including any setup fees, ongoing licensing fees, and any costs associated with integrating and maintaining the solution. Look for a solution that provides value for money and that fits within your budget.
By considering these factors when choosing a CDP, you can ensure that you select the right solution for your business and get the most out of your investment.
Digital marketing is constantly evolving, and new technologies and platforms are always emerging. As a result, digital marketers must stay informed and up-to-date with the latest trends and best practices to drive better customer retention and acquisition strategies.
Understanding your customers has been a consistent and ever-present requirement for marketers, and CDP like Wondaris helps you better leverage your data to drive more personalised, engagement and profitable interactions with your customers.
About the author
Simon Periera is a member of the Customer Data Institute advisory board, the CCO of XPON Technologies, and the co-founder of the Wondaris Customer Data Platform. As an experienced leader within the marketing technology sector, he is passionate about the role of technology, data and innovation in helping organisations unlock growth and success.