Why are customer data platforms frustrating to buyers, strategists, and consultants?

Summer is over. It's time to go back to CDP school!

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It can be easy to get caught up in the happenings with "open season on CDPs" e.g. TreasureData being bought by Arm & Datorama by Salesforce. Our lovely area of martech is in an all out growth stage right now, and most acquisitions should only equate to more benefits... though certainly some extra red tape. Have fun with that!

To kick off September, we lay out some groundwork that will hopefully make everyone feel at home. Upcoming content will focus on the many possible paths to implementing and making great use of a CDP. We'll isolate some of the variables that lead to these many possible paths, and talk about getting near-term value while focusing on long-term benefits. 

For today, some background on what is going on with CDP buyers.

Who is buying customer data platforms?

It's almost 2019. The first "year of the CDP" was nearly two years ago. Every organization needs at least some combination of features that customer data platforms provide, though not all organizations will solve their problems with a CDP. Organizations that will are likely to be:

  1. Organizations improving upon or creating a data strategy where the CDP will act as a platform for data that are already warehoused/laked
  2. Organizations improving upon or creating a data strategy where the CDP will act as a platform for data that are in silos
  3. Organizations improving upon or creating a data strategy where a CDP is already in place but needs to be extended through advanced configuration, which may include <gasp> bringing in a second (or a different) CDP
  4. Innovation teams within organizations that understand the importance of taking advantage of the latest technology and bringing it into the data strategy over time as it is better understood by the wider organization
  5. Martech buying teams that have an immediate need for the technology to solve a specific problem, or that otherwise like to buy new marketing technology

The keyword of interest above is "data strategy." Without one (Hello, #5!), the customer data platform is not even a hammer, but the nail. The implementing team is the hammer. Look out!

 

How are decisions about CDP technology being made?

In the best situations for organizations with a data strategy, decisions about CDP technology are being made centrally. Plans for the technology are centralized to some degree for efficiency and mutual internal benefit... even if the plan is simply to check back later.

In other situations, customer data platforms are being purchased by an innovation team directly, with or without centralized understanding of what is happening.

What frustrates buyers and strategists alike is that there can be plenty of value achieved in any of the above situations... and there are at least four distinct situations listed there.

To make matters more interesting, the implementation path depends greatly on which situation the organization is in, and what the near- and long-term plans for the platform are.

 

What are some common implementation paths taken by CDP buyers?

Centralized data strategy exists within the organization:

  1. CDP is being layered into tech stack to orchestrate communications through real-time profiles, modeling, and good old fashioned data trucking
  2. CDP is being fit into tech stack to bring in and experiment with new types of data, create efficiencies and otherwise add value
  3. 1 & 2
  4. CDP is a side project led by a single team to achieve one or more specific goals

No centralized data strategy exists within the organization:

  1. CDP is being added to tech stack to orchestrate communications and un-silo needed data for those communications, but not to act as a holistic "360 degree view" / system of record
  2. CDP is being added to tech stack to centralize all data related to customers as a system of record
  3. 1 & 2
  4. CDP is a side project led by a single team to achieve one or more specific goals

What is interesting but confounding about these implementation paths is the set of features needed for each of the eight paths listed.

Over time, as these implementation needs change based on the organizational situation, the features required of a customer data platform are also likely to change. 

That is why customer data platforms are frustrating to buyers, strategists, and consultants.

I look forward to going into much more detail on it in upcoming posts! For now, please feel free to schedule some time, ask directly, comment, etc. as I would love to hear thoughts.

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