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Own the customer journey with customer data platforms

Kristoffer Hald
Kristoffer Hald
Data & Intelligence Director
6 min read
1 March 2021

The International Data Corporation (IDC) forecasts the worldwide datasphere to grow more than 400% from 33 zettabytes (ZB) in 2018 to 175 ZB in 2025. Cloud analytics is also expected to grow to a $65 billion market by 2025 and nearly 30% of data will be generated in real-time. The global datasphere is expanding rapidly and in the future, data will mean even more to us and the way we work. Businesses that harness data now have the chance to boost sales and gain a competitive advantage.

With the data industry growing so rapidly, it’s not a surprise that customer data platforms (CDPs) have become established as a pertinent marketing technology; bringing together multiple sources of consumer insights to better analyse data and more effectively market to different audiences.

Abandoning data silos

Many companies have a tendency to work with data in silos. For example, when looking at paid social, brands tend to work only with the data that platforms such as Facebook, Twitter or LinkedIn provides; without taking into consideration how they can use data from other sources and combine them for additional insights and better marketing results.

In relation to search engine marketing (SEM) and search engine optimisation (SEO), companies often use Google Ads and Google Search Console as their primary data sources. Often this data is combined with data from their website through Google Analytics or other web analytics tools.

Brands tend to work with data from a maximum of three to four sources, which can generate great results; but it’s just the tip of the iceberg. Other data sources, such as CRM systems and physical stores, offer additional customer insights that can further improve targeting and marketing efforts. This is where CDPs come in, enabling businesses to collect data from all sources and work intelligently to create better customer journeys, while saving money.

Benefits of customer data platforms

  • Understand the customer journey – by connecting all digital customer data to create a full picture of customer touchpoints, companies get a better understanding of their audience.
  • From unknown to known – brands will be able to recognise users, creating more possibilities based on their behaviour even without a login function on their website.
  • Personalise the full journey – activate the data to personalise content to different users and present the most relevant advertising that they are more likely to engage with.

The CDP structure

By implementing a CDP, the ultimate goal is to automate customer personalisation across channels, fuelled by unified data and machine learning. There are four key data platforms needed to create a CDP and enable digital personalisation at scale:

  • Storage – a platform to store the customer data. This platform consolidates data from different sources to create a 360 customer view and make it available for personalisation. Sources can include websites, apps, stores, CRMs and marketing platforms that are connected to enable data to automatically flow into the storage platform. It can take time to set up but once done initially, it is basically automated. 
  • Insights – a platform to visualise data, pull reports and create audiences. The business intelligence platform provides performance dashboards and enables marketers and analysts to conduct deep-dive analyses and create marketing audiences based on rules. Self-service analytics is the goal with this platform, enabling ‘non-tech’ users to easily extract information. 
  • Intelligence – a platform to enrich the collective customer data through machine learning. This is where algorithms and machine learning are applied to move beyond rule-based segmentation and make predictions about customer behaviour based on their previous activity. The data quality needs to be strong to set this up, but once complete the possibilities are almost endless. 
  • Activation – the unified distribution engine. This platform activates audiences generated by the insights platform across different channels in real-time. It activates data for media and web personalisation and ensures a coherent, cross-channel tone of voice.

These four platforms are already available on the market in multiple different formats. Major tech players such as Google, Microsoft, Salesforce and Adobe offer their own solutions for most of these platforms. 

Businesses can construct their own CDP by connecting platforms from different providers, but it’s also possible to purchase a full CDP solution that demands less implementation work; however, this comes at a cost and can be limited in terms of customisation.

Data analysis and intelligence

CDPs are an ideal solution for identifying customer segments to better understand audiences and their behavior. When looking beyond data silos, unified customer data allows companies to prioritize and target users in different ways than before. For instance, many e-commerce clients use revenue and return on ad spend (ROAS) as their main KPIs in digital activities.

A CDP would enable the brand to understand how those revenue and ROAS levels actually impact the bottom line. It can provide valuable additional data on return rates, margins and stock levels, giving a better insight of the true campaign ROI.

CDP in practice

DEPT® built a CDP for Rituals, who wanted to be able to predict the behaviour of its customers. We used machine learning to predict conversion intent by matching real-time browsing behaviour to historical conversion patterns. This resulted in much more efficient retargeting by targeting audiences based on their expected probability to convert. This approach saved 40% of Rituals’ remarketing ad spend without reducing conversions.

The CDP also helped Rituals to predict when users are in-market for a product such as soaps and perfumes that users frequently rebuy. By using unified customer data, we were able to predict by week number when customer segments were back in the market for a Rituals product they had previously bought. We then used the predictions to re-engage those segments with digital campaigns at the right time and with the right product.

The majority of companies have several customer behaviour data sources that aren’t being compiled and utilised to their full potential. In these cases, CDPs enable brands to gain actionable insights and and achieve better results from digital marketing efforts. With data reliance growing at such a rapid pace, it will be the brands that leverage this opportunity now that gain a competitive advantage and achieve the best ROI in the long term.

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Data & Intelligence Director

Kristoffer Hald