May 19, 2022
Making the business case for a CDP
Leading retailers across industries are turning to Customer Data Platforms (CDPs) to take the guesswork out of creating customer experiences and informing their actions. Read ahead to discover how you can make a case for deploying a CDP to grow your business.
If you’re still relying on guesswork or one-size-fits-all approaches to meeting customer needs, it’s time to make a change.
Your customers desire the experiences that engage them as individuals and make them feel like a valued contributor to your brand. At the same time, your teams need automated tools to remain adaptive and collaborative amidst shifting customer needs. Achieving this high degree of efficiency and agility is easier said than done—unless you deploy a customer data platform (CDP).
Leading retailers are making business cases for CDPs, and deploy these platforms to help them empower deep team synergy, giving their staff a single accurate database to create the engaging customer experiences that drive revenue growth.
How do you make a case for a CDP at your business? In this post we’ll dive into the many benefits of a CDP and provide customer data platform use cases that’ll inspire your executives and leaders to make the jump.
What is a CDP?
A CDP is a software tool that breaks down siloed databases to create a unified hub for all of your customer data in the form of a single customer view. This database is built upon a vast assortment of customer data-points including everything from demographic information to purchasing history and behavioral attributes.
With this unified hub of customer data you’ll give your teams the opportunity to create experiences that bring your customers closer to your brand, reducing the potential for churn, improving marketing ROI, and growing your customers’ lifetime value.
Similar platforms, like Lexer, specialize in helping retailers craft unique customer experiences. Termed as Customer Data and Experience Platforms (CDXPs) these tools give users in-depth customer insight so that they better speak to unique customer needs and personalize interactions on a granular level.
Benefits of a CDP
Adopting new technologies can be met with some apprehension, particularly if there is an attachment to legacy processes and tools. However, the only way to succeed in the current age of retail is to innovate your tools and your strategy—and CDPs can accelerate that innovation. CD(X)Ps, like Lexer, are built specifically for retail and help you gain an edge over your competitors, ensuring your customers stay engaged and loyal to your brand.
Gain a deep customer understanding
CDPs are built on zero- and first-party data. This data is pulled from a variety of sources in real-time, meaning that you can paint the most accurate picture of your customers possible.
Your teams can use data in a CDP to create individual customer profiles that inform how you target lookalike customers or create finely tuned experiences that match specific behaviors and needs. With this rich understanding you'll keep customers engaged across every point of their lifecycle, growing their lifetime value and reducing churn rates.
Drive revenue through advanced customer segmentation
Timing and relevance is everything. With a CDP you can not only understand the kind of message that your customers will resonate with, but you’ll be able to target them with that relevant message at exactly the right time.
CDPs come packed with tools that help your teams create highly refined segments. These segments bring a granular approach to engagement, as you can divide your customers based on granular attributes such as products purchased, promotions activity, time to purchase, gender, and age. As a result, your teams can directly improve the lifetime value of your customers by targeting specific characteristics, needs, and behaviors.
Empower your employees to collaborate and succeed
CDPs can grant company-wide access to a single customer database giving your teams the ability to collaborate seamlessly. Thanks to this easy data access, you can accelerate the time it takes to create and launch initiatives, reducing operational costs, ensuring team autonomy, and improving employee satisfaction. Additionally, CDPs deliver your staff with the tools to easily pull detailed performance reports and showcase the positive impact of their coordinated efforts, ensuring that all teams and executives are fully informed of your current efforts.
Automate and innovate your approach
CDPs streamline many of the data capture and outreach processes that would typically have to be performed manually. This automation removes the heavy-lift needed from some of your teams. For example, CDPs update customer databases automatically in real-time, capturing that data from a vast range of sources. This data can then be used to create automated marketing campaigns that trigger the moment a certain condition is met, connecting your customers to the right message at exactly the right time. All of this can be done in the CDP with little to no direct actions from your staff.
Enhance your decision-making processes
CDPs directly impact decision-making, helping every part of your business inform their actions. Want to understand the viability of a potential replenishment campaign? A CDP will provide you with insight into your product collection to determine which hero product might be the right fit. Looking to launch a re-engagement promotional campaign? With a CDP you can not only create a refined segment of lapsed customers, but you can use the data in customer profiles to identify the messaging that will bring them back into the fold. Tooled with a CDP, you can enhance your decision-making and realize your strategies with far greater agility and impact.
Customer data platform use cases
Many retailers have found success in launching a CDP for their business. Take cookware retailer Sur La Table for example. Before deploying a CD(X)P they struggled to turn their one-time buyers into returning customers. Sur La Table utilized Lexer’s Customer Data and Experience Platform (CDXP) to analyze customer behaviors and were able to:
- Understand their customer zeitgeist
- Identify the hero product that result in more second-time buyers
- Create a personalized approach to customer outreach
- Launch a customer loyalty program that resulted in improved retention rates.
Tactical gear and apparel retailer, 5.11 also realized substantial results after deploying a CDP. They too struggled to fully understand the nuances of their customer behaviors, and wanted to better market to their needs. With Lexer’s CDXP the 5.11 marketing team was able to:
- Gain a deep customer understanding
- Increase personalization and customer segmentation
- Improve email conversions by 111%
- Track customer satisfaction following the last purchase.
Know your customer. Grow your business with Lexer’s CDXP
Lexer is the customer data and experience platform of choice for over 150 leading brands and retailers, helping them develop a deeper understanding of their customers to improve experiences and drive revenue growth. We put the power of your customer data directly into your hands, ensuring you have the insights necessary to grow your business. Our intuitive tools enable retail, marketing, and service teams to create data-driven engagement strategies that positively impact every stage of the customer lifecycle.