The Top 9 Benefits of a Customer Data Platform
Businesses big and small can reap the benefits of a customer data platform.
If you don’t know anything about the people who buy from or visit your business, it’s practically impossible to form lasting, meaningful relationships with them.
The more you know about your customers, the better equipped you are to connect with them, give them what they want and need, and build lasting trust and affinity. A customer data platform helps you accomplish this.
Let’s look at what a customer data platform (CDP) is and how your business can use it. Then, let’s look at the top benefits of a customer data platform and how a CDP can support your business whether you are a small mom-and-pop shop or a regional, multi-location brand.
What Is a Customer Data Platform?
A customer data platform is software that creates robust customer profiles by curating and centralizing customer data from multiple platforms. Consumers use multiple platforms during the buyer’s journey. A customer data platform pulls information from each of those touchpoints to create one unified database with information about consumers.
It combines both consumer data and business data and curates information from:
- Point of sale systems
- Customer relationship management systems
- Social media profiles
- Website analytics
- Other third-party data sources
A customer data platform is different from a customer relationship management (CRM) system and customer relationships management (CRM) system. Both of those systems are specific to the type of information they collect. A customer data platform pulls information from both of those systems to create one centralized system of data.
Related: Customer Data Platform vs CRM | What's the Difference?
9 Benefits of a Customer Data Platform
If you aren’t sure if you need a CPD, consider the benefits of a customer data platform.
#1) Centralize your customer data into one platform.
Information about your customers is stored on multiple platforms and channels. A customer data platform curates information from each property and puts it all in one place so you have one database offering a comprehensive look at your customers. You don’t need to toggle between platforms to gather information about customers.
#2) Learn about your customers.
When you have a comprehensive look at your customers, you can get a better idea of who they are and what they want and need. You can create more specific and accurate buyer personas to drive your marketing efforts and operations.
#3) Segment customers based on engagement level.
By tracking customer interactions with your brand, you can identify how engaged customers are with your brand and where they are in the purchase funnel. Then, you can create marketing campaigns based on that engagement level. For example, you can focus on reaching engaged customers most likely to visit again, or re-engage past customers who haven’t visited your business in a while using retargeting tactics.
#4) Improve your marketing messages.
Intimately knowing your customers makes it easier to improve your marketing messages so they better resonate with your audience. You can speak directly to your audience when you know what language they use, problems they have, solutions they seek, and products and services they have a history of buying.
#5) Identify your most effective marketing channels.
Knowing about your customers also helps you identify the best ways to reach them. By looking at their habits and behaviors, you can identify the marketing channels where they spend the most time and where you will be most likely to reach them.
#6) Directly connect with customers via email and text.
Having the phone number or email address of your customers gives you a direct connection to reaching your audience. Text marketing and email campaigns are effective ways to get in front of your customers, and they don’t rely on budgets or reach like ads or organic social posts. You can leverage contact information to reach customers right when you want to.
#7) Personalize messaging and marketing.
The information in a customer data platform allows you to personalize your communication with customers. You can refer to them by name as well as offer products and services that they are most likely to be interested in based on past purchases and buying behaviors.
#8) Improve products and services.
Learning about and knowing your customers has benefits that go beyond marketing and sales. When you know what pain points your customers have, you can identify new products and services that your audience will want and need.
#9) Simplify your marketing.
One of the biggest benefits of a customer data platform is the ability to use marketing automation to simplify your marketing. Now that your data platform has details on all your customers and your messaging is more personalized, it is time to automate the processes to save time and resources, making everything simple to manage. Related: How to Use Restaurant Data Analytics To Grow Your Business
What Types of Data Does a CDP Use?
To reap the benefits of a customer data platform ensure that you are collecting the most useful information from consumers. The most effective customer data platforms use a variety of data points to help you get to know the many sides of your customer base. The data points come together to create a sophisticated profile of customers that extends beyond one data set. Data points may include the following types of information.
Contact Information: How can you reach the customer?
- Phone Number
Location Information: Where does the customer live? Where do they work or regularly spend time?
Demographics: Who is your customer? What groups do they belong to?
- Marital Status
- Job Title
Psychographics: What motivates your customers? What attitudes and interests do they have?
- Success Factors
Behavioral & Transactional Information: How does your customer act? How do they interact with your brand? What are their purchasing habits?
- Past Purchases
- Date of Last Purchase
- Date of Last Website Visit
- Date of Last In-store Visit
- Email Opens
- Email Clicks
- Web Pages Visited
- Engagement with Your Social Profiles
Related: Why It's Important to Own Your Business Data and How to Start Collecting It
How to Build a Customer Data Platform
Now that you know the benefits of a customer data platform and why it’s useful for businesses who want to learn about their customers and create more effective sales and marketing tactics, it’s time to create one of your own.
At MyArea Network, data is at the heart of everything we do. If you need help developing your customer data platform, we are here to help. We have software and strategy solutions that can help you curate the information you need to understand, reach, and sell to your customers.
Contact our team to see how we can help you launch a powerful customer data platform of your own.