January 2, 2020 | 4 min read

How to find the best CDP for your business

We first need to understand what a CDP really solves for, and why the category is suddenly gaining so much traction.

Teal datawave pattern

If you do some quick investigating, it sounds like all CDPs do roughly the same thing. They bring data in customer data from various sources, they create a single customer view, and they send that data out to external touchpoints. So what are the actual differences? And which one is right for your business?

To figure this out, we first need to understand what a CDP really solves for, and why the category is suddenly gaining so much traction.

The birth of the Customer Data Platform

Over the last decade, there’s been a proliferation of channels, technologies, and touchpoints that all capture and consume customer data: email service providers, clickstream, eCommerce, point-of-sale, social media, tag managers, campaign management, customer analytics platforms, to name a few. These systems weren’t designed to integrate with one another, and the data they produce doesn’t share linking keys across systems. This means disparate systems, siloed and inaccessible data, and fragmented customer profiles.

As a result, brands (especially established brands with a variety of online and offline data sources) have a ton of great customer data, but they can’t use it. Worse, they are struggling to compete in a new landscape where consumers have come to expect seamless experiences and personalization.

These expectations come from real-world interactions with internet-first brands like Amazon, Uber, Google, Netflix, Airbnb, Facebook, and others. These brands are all masters of managing and using customer data. They offer amazing personalization and CX that consumers love. And they are stealing wallet-share from the rest of the market ‒ disrupting entire verticals and generating to-the-death competition for some of the world’s most loved brands.

Out of this shifting landscape, analysts and business leaders have quickly recognized the urgent need for better, more personalized CX and marketing ‒ and the corresponding requirements for better, richer, more usable customer data. Enter the Customer Data Platform.

So many CDPs

If you visit the site of the CDP Institute (an organization that aims to define and educate on the category), you’ll see a lot of vendors listed there. For a category that was first defined in 2016, it’s surprising to see roughly 40 vendors. Where did they all come from? And why so suddenly?

The answer is that most of the vendors who today call themselves Customer Data Platforms started off as something else. As soon as the category started to gain traction, many vendors rebranded themselves as CDPs. Most of these vendors began as one of three other vendor types: tag managers, multi-channel campaign managers, or data management for customer data analytics platforms.

These vendors made the category shift because their platforms all needed better, more unified customer data to perform. So each of them was already working to add or improve their customer data management capabilities anyway. With all the hype around CDPs, it was natural to adopt the new name and ride the wave.

Risks of choosing rebranded CDPs

Each of these categories was built and optimized for something specific. Tag managers are expert at collecting data directly from your site. Multi-channel campaign managers are optimized for real-time interactions. And data management for customer data analytics platforms excel at legacy approaches to data management, popularized in the last decade before the innovations of cloud computing changed what’s possible.

The risk of using each of these types of vendors as your CDP is that ‒ depending on the details of your unique customer data needs ‒ you might fail to solve the actual customer data issues that are holding you back.

For some of you, a tag manager-turned-CDP might be just right; for others a campaign-manager-turned-CDP might be best. For others a new type we’re calling pure-play CDP must be best (that’s what Amperity is). Learn more at Amperity.com.