CDP is indispensable on high scale business. Choosing right CDP will impact on business growth(DXP Part-4)

7 min readDec 4, 2022

Previous blog on series of DXP,
Part 1 : Digital Experience Platform Introduction
Part 2 : Customer Data Platform Introduction
Part 3 : Before DXP implementation, What should you ask to customer?

What will you learn from this article?

Snapshots of market reports
CDP institute vital role on choosing the CDP Provider
Different type of CDP for your organisation

It would like to start this article about CDP Industry growth rate from CDP institute

The CDP industry grew sharply in the first half of 2022, adding eleven vendors, nearly 2,500 employees, and $1,516 million in funding. This is the most new employees and funding for any period on record.

Today customer expectations are very high, especially post pandemic. organisations are struggling to maintain brand consistency and meet the user experience expectations. Every customer expectation is brand to understand their daily needs and serve accordingly content and assets. As we know according to our previous blogs, DXP helping to do that. In DXP, one of the most interesting and next-gen technology is Customer Data Platform(CDP). Nevertheless it is important and intelligent component, Still many of the organisation doesn’t have too deep knowledge about it. This blog will cover important aspects of the CDP for organisation, they should know before take decision of investing towards of CDP. For every organisation, investing on CDP is one of the solid percentage in their revenue, which means they have to know each and every corner of the CDP before take a decision of purchase or use.

Let’s look at few market reports on CDP,

In 2022, the customer data platform (CDP) industry revenue an estimated $2 billion, up 25 percent from a value of $1.6 billion reported a year earlier (Statista, Sept 2022)

The global Customer Data Platform market size is projected to reach $5.11 billion by 2028, from $1.906 billion in 2021, at a CAGR of 15.0% during 2022–2028. (AbsoluteReports, Feb 2022)

73% say a customer data platform will be critical to their customer experience efforts

Customer experience is the key factor for digital presence, which will keep the brand position in the market. If you fail to serve the customer experience in best quality, it will impact on your business revenue. None of the organisation will like that. Today in digital-first world, customer data platform is playing vital role to serve the best in class customer experience for brands. Let’s look at customer data platform unknown insights, which will helps organisations to take right decision to choose right CDP for their business.

Customer data platform is next generation intelligence engine, where you can connect all your customer data on single point get the insights of the customer behaviour on online/offline activities. I have created a blog in detail about customer data platform as introduction couple of month before with different technical aspects. These blog is going to be continues of that, but it will talk more on interesting aspects of business decision, while choosing the CDP.

Origin of CDP

Customer Data Platform is defined by the CDP Institute as “packaged software that creates a persistent, unified customer database that is accessible to other systems”

To know more about CDP institution and back story, Please click here.

Organisation does’t have idea how to choose right data platform for their business. CDP Institution will help us to filter the right provider for right business context. The authentic CDP Provider, will have a certification as “Real CDP” Certification.

According to CDP Institute, below are the criteria to become a Real CDP Provider

1. Ingest data from any source of system
2. Ability to capture full detail of ingested data
3. Store ingestion data indefinitely
4. Ability to create unified profile of identified individuals
5. CDP should have ability to share data with any system according to the business needs
6. Respond in real time to new data and to profile requests

According to CDP Institute, we should choose the goal and objectives of the business which will help us to choose the right CDP Providers.

Define the goal of your business

Defining the goal of the business, will give you better understanding towards the customer data usage and it will be very essential on measure outcomes. We should decide following factors to define the goal of your business,

Identify the Business goals
Decide the marketing strategy
Marketing Priorities
Customer Data Platform objective (For what we are going to use)
Deciding activation channel
CDP investment budget
Decide the hosting ability of CDP tool (According to your in-house abilities and supports)
Decide the need for CDP on B2B / B2B
Business need to have boundaries around data privacy and regulations

Identifying the business goals are very important which will help you to align the activities and investment on the same angle.

Marketing strategy will define the overall game plan of the business. It will cover 4Ps (Product, Price, Place and Promotion). Product/Service we need to find the usage and speciality of that in the market. We need to have a far understanding about the Price among the competitors, whether consumer will be willing to pay for this product/service. Where to Place the service to reach to consumer, which will create more impression and strong reason to choose the product/service. The way of Promotion of the product/service has to be identified to get the ROI out of marketing strategy.

Every business will have more than one Marketing Priorities according to the goal of the business. It would be to like,

1. Create awareness across people about the brand
2. New customer acquisition
3. Retention of the old customers
4. Reducing the operational cost of the business.

Identifying the objective of CDP usage in business. Which is very essential to understand the investment point-of-view. It would be one of as below,

ETL, Unify the customer data and expose to respective channels
Identity resolution
By analyse the customer data. we will create a unified profile and segment them
Predictive intelligence enablement
Personalization / Targeted recommendations
Enablement of realtime interactions with more user-friendly
Delivering messages to different channels

Deciding activation channel will help to evaluate your data platform need. Also it will give you the approximate ideas around your investment towards channels and resource planning. Business might need to choose one of the below,

Web Content Management System
Email / Campaign automation system
Mobile apps / IOT Devices
Different Advertisement Channels
Internal Customer Information system like CRM, HRM, etc …
E-commerce Websites
Offline marketing materials

Budget of CDP has to be decided with max boundaries according to the current revenue and man power.

Hosting ability is one of the important aspect to consider as very careful decision it involves the privacy and security parameter for customer data. Organisation need to take this decision according to their in-house ability or technology enablement vendor recommendation.

Solid business goal will give the direction to choose a right CDP type for organisation

CDP implementation has been mission critical for companies who are serious about developing data-driven, customer-centric experience and hard core business strategies. There are different types of CDP available, which will help us to keep the scope of the data orchestration and processing at different stages. Below are the types,

Analytics CDP
Campaign CDP
Data CDP
Delivery CDP

Analytics CDP are provides the data assembly plus analytical applications. The applications always include customer segmentation and sometimes extend to machine learning, predictive modelling, revenue attribution, and journey mapping.

Campaign CDP will provide the data assembly, analytics, and customer treatments. What distinguishes them from segmentation is they can specify different treatments for different individuals within a segment. Treatments may be personalised messages, outbound marketing campaigns, real time interactions, or product or content recommendations. They often include orchestrating customer treatments across channels.

Data CDP will gather customer data from source systems, link data to customer identities, and store the results in a database available to external systems. In practice, these systems also can extract audience segments and send them to external systems. Some began as tag management or Web analytics systems

Delivery CDP will enable the data assembly, analytics, customer treatments, and message delivery. Delivery may be through email, Web site, mobile apps, CRM, advertising, or several of these. Products in this category often started as delivery systems and added CDP functions later.

Taken together, campaign and delivery CDPs are the dominant types of vendor in the industry, accounting for a combined 68% of companies, 75% of employment, and 75% of funding. Delivery CDPs are the fastest
growing group.

Click here to filter and find the right CDP vendor depends on the type and business need.

CDP Institute has been enabled to support the customer on different spots like they have complete guide for vendor filtering, personalised training for customer (Pre-Purchase / Post Purchase of CDP Platform), supporting through different documents to choose your business objectives and goals to buy right CDP providers for your business.

What you can expect in upcoming article related to CDP?

CDP use cases and benefits
Challenges to implement CDP in organisations
Privacy & Compliance of CDP
How organisations need to adopt the CDP in current ecosystem

Thanks for reading this article. Will catch you soon with another interesting topic in few weeks. Please post your comment on my email developersnacks@gmail.com