What is Customer Data? And how do you store and activate it in a CDP?

Jan 31, 2022 | 3rd Party Cookies, Customer Data Platform, GDPR, Data consent

By Anders Spicker

}

Reading Time: 3 minutes

Back to blog

Customer data refers to the information that businesses collect about their customers through various sources, such as interactions with the company website, social media, email, mobile apps, and other channels.

Customer data continues to be a hot topic in the world of marketing, sales, IT – basically any department that needs to take advantage of the large amounts of customer interactions that take place in many separate systems.

If you work within any of these fields, you might already be aware that collecting and organizing your customer data is a must. But you might not fully understand what customer data is and what problems it can solve for you.

We are here to break it all down for you.

What is Customer Data?

Imagine a customer looking for a new pair of running shoes.

Throughout the process, she might:

Browse around a site selling running shoes
Watch a few videos or blogs rating the top-sellers
Research customer reviews to make sure the site is safe
Check out the brand’s social media platforms for inspiration

By the time she finally makes a purchase somewhere, she has probably interacted with that brand on several different touchpoints, leaving a small footprint behind each time.

Customer data is exactly this: It’s the total collection of data stemming from anything from anonymous ad impressions to known purchases from every visitor interacting with your brand.

Today, companies are swimming in data (in part due to 3rd party data, which will soon be cut out by Google – read about the end of 3rd party data here), so organizing that data to get to know customers is all-important.

By collecting and analyzing customer data, businesses can gain valuable insights into their customers' needs, preferences, and behavior patterns. This allows you to make informed decisions and tailor your marketing and customer service efforts to meet your customers' needs.

Customer data is a critical asset for businesses in today's data-driven economy, and companies that leverage customer data effectively can gain a competitive advantage in their respective markets.

That is where a Customer Data Platform (CDP) comes in.

According to Forbes, one of today’s major challenges that retailers face is to take advantage of the great amount of POS, behavioral and ecommerce transactional data – from economic indicators to customer spend at competitors.

How do you store and activate Customer Data in a CDP?

A Customer Data Platform (CDP) solves one of the hardest challenges facing businesses today:  Unifying and activating customer data across the organization, including known user data, in a way that benefits customers’ experiences.

A CDP makes it possible to create a truly personalized experience for each customer, but the system also gives you a stable “arena” to grow from. When your customer base expands, the CDP will follow and make it possible to keep managing data and adding new channels as you go. 

The main purpose of a CDP is to seamlessly collect customer data in real-time from various data sources and activate this in relevant channels. It is also an operational platform that enables marketers to create advanced audiences based on customer data from all relevant sources. 

What a Customer Data Platform does best?

1. Understanding your customers

With a CDP you take data from any type of source, both online and offline, and create the Single Customer View that fosters quality personalization.

2. Improving customer trust

Customers are more comfortable sharing data in exchange for personalized experiences. However, they expect you to protect that data. 81 % of customers say that trusting a brand is a deciding factor in their purchase decision.

3. Securing customer-centric marketing 

To perform customer-centric marketing, you need to know your customers. A Single Customer Views always provides you with that knowledge in real time by automatically ingesting data from all sources. 

4. Predicting your customer’s next move

Instead of guessing what a visitor is likely to be interested in on your website, former behavior can predict their future choices thanks to AI and machine learning technology. Better predictions shape a better outcome and customer experience.

In short…

A Customer Data Platform is the key to understanding your customers and delivering a full omnichannel experience. There is no doubt that a CDP can be quite the complex venture, and this blog post only scratches the surface of what a CDP can offer your business.

From describing your use case to finding the right resources in your organization, there is much to prepare. But with the right knowledge – and with solid support along the way – a CDP can truly transform the way you do marketing and sales.