Why retailers use customer data platforms
CDP Use Cases
What are some cases for a CDP?
In retail, technology now plays a huge role in helping businesses gain a better understanding of their customers and the general market environment. One such tool that is quickly becoming crucial to any kind of customer-focused industry is a customer data platform, or CDP for short.
What is a customer data platform? A customer data platform is a key instrument to the data collection process. These platforms host software that aggregates customer behavior from a variety of sources to create a comprehensive overview of individual customers. Customer data platform vendors serve an intermediate purpose in the connection between a business and the customer.
When it comes to who is able to make use of a customer data platform, examples vary widely and virtually cover every type of retail business. A customer data platform is extremely useful for helping retailers follow their customers from the beginning to the end of their journey with the brand through marketing, sales, and service. This kind of heightened awareness of a company’s targeted customer’s behavior translates into a large collection of data that can be used to improve their experience with the business, thus increasing profitability overall.
As previously mentioned, the range of CDP use cases expands to include a variety of components in the implementation of a company’s retail strategy. For marketing, a customer data platform comes in handy when developing customer profiles and crafting marketing messages catered to them. Once a customer visits an establishment, this presents an opportunity for the sales force to utilize the data collected and create stronger connections and better customer experiences. Finally, a customer data platform can play a large part of bolstering customer service efforts to better facilitate conversations with customers.
Real time CDP use cases
Something that makes CDPs so effective is their ability to synthesize and process customer behavior data in real-time. A customer data platform actively collects data from third parties, retail purchases, email engagement, and more to not only integrate, but update individual customer data to strengthen profiles. Whether a customer is visiting social media platforms, buying products in-store, or opening company emails, a customer data platform can make use of all of the accompanying data by turning it into real insight into how past and current customer behavior connects to and can predict future customer behavior.
When determining which CDP is more effective for retail business specifically, some common customer data platform best practices and features come up. Essentially, having as much relevant data as possible and being able to keep it up-to-date is a goal many customer data platform vendors seek to provide. The ability for a customer data platform to cleanse and standardize data is an important step in the data collection process, as this information will eventually be used to fill in customer profile gaps and predict their future behavior.
As a leading provider of customer data platforms for retail businesses, Lexer has accumulated a number of real-time CDP use cases and success stories from its clients. One example is Brand Collective, which had experienced negative effects due to COVID-19 and needed an updated strategy that included understanding customers making increasingly more online purchases. Brand Collective was able to use Lexer’s CDP to collect real-time data composed of information from a variety of digital channels. By gaining insight into their customers’ online behavior, Brand Collective could make more well-informed decisions catering to their target markets in the online space. Brand Collective is an example of how beneficial a CDP can be in attracting customers, as they doubled acquisition.
CDP use cases retail
Among other customer data platform companies, Lexer stands out as a strong partner for brands and retailers looking to transform into customer-centric businesses. Lexer’s CDP increases visibility at all customer touchpoints with detailed insights and analytics, which can be used to improve marketing efforts and the retail experience for customers. With the right AI-powered predictive analytics, third-party data enrichment, and targeted customer surveys, a customer data platform can massively expand the knowledge accessible to retailers about their customer base.
A customer data platform allows retailers to understand their customers at a higher level. A combination of online, in-store, and third party or outside data provides a more nuanced perspective of the customer and what the best ways are to connect with them. This is particularly evident in CDP use cases (retail-related) detailing how retail businesses have successfully used customer data platforms in their efforts to improve customer experience and service while growing sales.
The experience a customer has with a retailer can stick with them and play a large role in deciding whether they will continue doing business with a specific retailer or not. With the help of a reliable customer data platform, retail businesses can increase the likelihood of making these experiences positive and relevant to the customer on an individual level. Sales associates can get access to a customer’s profile quickly, providing them with an immediate overview of previous omnichannel interactions. Knowing a customer’s history can help guide retail personnel through the process of providing more personalized service, encouraging higher-value sales.
A customer data platform also facilitates the tracking of the impact these experiences end up having on customers. Features that allow for detailed tracking and reporting on sales performance are a way to frequently assess a retailer’s current situation so they can provide more exceptional service experiences.
B2B CDP use cases
At this point, the benefit of a customer data platform in the business-to-customer landscape is clear. On the other hand, how does a customer data platform contribute to business-to-business interactions? While this kind of platform is popular among retailers for connecting with their customers, vendors of customer data platforms can also partner with other businesses or third-party data providers.
Although many of the top CDP use cases may be associated with B2C operations, the technology of a customer data platform can be combined or integrated with similar providers. Lexer in particular is the leading customer data and experience platform for retail tech stacks such as Shopify, Facebook, Google Ads, and more. A sophisticated customer data platform can play a crucial role in the construction of other platforms that could benefit from using the technology.
On the topic of B2B CDP use cases, the intelligence built into a customer data platform can complement other businesses or providers. Lexer has a wide range of partners, including third-party data providers and agencies that offer guidance and support for its mutual customers. A partnership with a customer data platform like Lexer can help other organizations provide analytics, segmentation, and activation capabilities to their clients.
Customer data platform software
A top notch customer data platform software provider could have a massive influence over businesses that don’t currently have access to the kind of aggregated data such a platform provides. The top customer data platforms typically have the ability to create comprehensive, detailed customer profiles and monitor a retailer’s performance in engaging their targeted customers with unique experiences. It’s also ideal if they are equipped to update this database in real-time, so retailers aren’t basing their strategies on outdated information.
An important component of the customer data platform architecture is the actual data collected and processed. Lexer’s customer data platform includes pre-built integrations that facilitate the quick combination, enrichment, and transformation of data in a single, focused view of the customer. Another element to consider is how a retailer can interpret such data.
Lexer has armed its customer data platform with simple tools, making it possible for a wide range of team members to utilize its insights without being bogged down by a more complex structure. When the entire business has access to such pertinent data and insight, it can give a retailer the power to orchestrate experiences across marketing, sales, and service, the impact of which can be measured.
CDP in marketing
A comprehensive customer data platform can help influence the way retailers approach customers before, during, and after their experiences. CDP in marketing is especially significant when it comes to organizing and planning future initiatives. This can result in the attraction of higher-value customers.
A customer data platform can integrate raw data across multiple channels to construct realistic customer profiles. Once a retailer has gained a deeper understanding of its high-value customers, they can then take a more focused approach when marketing to these individuals. It’s also valuable if a customer data platform is equipped to consistently enhance and update these customer profiles.
The acronym CDP may look familiar to those that have heard of CRM. While the two may seem similar, the role of a customer data platform vs CRM in the marketing sphere is different. CRM, or customer relationship management, is a system that manages a retailer’s contact history with its customers. While a customer data platform can derive information from a variety of sources as mentioned previously, CRM systems can’t extract data from any source. Their integrations are more simple and basic, often lacking the feature of real-time informational updates. A customer data platform has a wider reach.