Tag Archives: Customer Data Platform

GDPR: How using a CDP solves cookies problems

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The General Data Protection Regulation (GDPR) was created to give internet users more control over their personal information. Is your company working according to the law?

While you’re probably aware of the existence of this regulation, you may still not know all you need to about it. For example, did you know this law has existed since 1995? Yeah, and only in 2012 has it started being reviewed.

That happened because of the huge amount of data being generated nowadays. As a matter of fact, the foresight for the year 2020 was that 35 trillion gigabytes were going to be created. It makes sense that a project for data protection would start.

Approved in 2016, the GDPR is a project made in the European Union. However, it affects each and every country that has a connection with EU countries. That means anyone who buys or sells products or services with a country that is a part of the region needs to follow the data protection rules.

In order to make that job easier, many brands are appealing to the Customer Data Platform. This is a solution that works with Customer Data without breaking the law. To thoroughly understand how the CDP can help here, how the GDPR works, and more, keep reading this post.

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What is the GDPR?

With the growth of data usage came the need for some kind of regulation for brands to use information without becoming invasive to users online. Because of that, GDPR came into force.

As you can probably imagine, the main reason behind it is to protect the user and their privacy. Mainly because, with the amount of technologies nowadays, it’s so easy to gather data and use them to personalize ads and content. 

However, that only works if the user allows you to do it. If you send personalized offers for someone who has never even been to your website, it will feel like a privacy invasion.

With GDPR, the user or client has a guarantee of control over data collected. This means that the company needs to ask for permission to gather and store information about them. But, even more than that, the brand needs to make clear what kind of information is being collected, what it will be used for, how long it will be kept in storage, and who it will be shared with.

What about customers’ rights? To sum up what GDPR says about the subject, the client must have:

  • access to collected data
  • control to correct wrong data
  • possibility of data exclusion
  • access to review and deny automated processes using their data
  • visibility of data transfer to thirds

It does sound like a lot to keep track of, but it comes with a bigger reward: a trustful relationship between brand and customer.

What does that mean? Instead of looking like a privacy-invasor brand, it only communicated with the client according to what they alone decided to share with the company. Therefore, building their success through a highly tailored and excellent customer experience.

How do GDPR and CDP work together?

In order for the company to work according to GDPR rules, it needs strict control over the data they collect. They need to know where the data came from, where it is stored, how it is being used, who it is being shared with, and so on. Every single detail needs to be known.

So, this is where CDP comes into the picture:

The Customer Data Platform, CDP, is a system that does this thorough job with customer data. It collects, processes, and stores data that is relevant, useful, and clean.

Overall, the CDP is built to provide the company flexibility. In other words, even though it’s mainly used for marketing purposes, it can allow other software to have access to its information. 

Thus, the Customer Data platform does exactly what companies need, now that GDPR is out there. Since they need to know everything about the data, CDP is there for it.

What are some specific requirements of GDPR that the CDP is helping brands with? Here’s a few of them:

  • identify where data comes from
  • connect with other data sources
  • gather all customer data into a singular profile
  • correct data
  • document customer authorizations
  • manage and store data usage
  • privacy by design

Moreover, the Customer Data Platform is pivotal for first-party data collection. Something essential seeing that third-party data is becoming less popular by the day — which happens due to the lack of reliability in this type of information, that also breaks (most of the time) GDPR laws of data protection.

The use of first-party data is the goal from now on. With this, you can ask for permission of the user in the direct relationship of the brand website visitor.

In short, to work according to GDPR, companies have the option of not collecting data (kind of unfeasible in this day and age), collect less data than they used to, or use systems that work through those rules, like the CDP.

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What is there to know about the CDP?

As previously mentioned, the Customer Data Platform is the best alternative for brands that want to work with Customer Data while sticking to the GDPR.

It is a system developed to assist marketing teams, but it has grown into much more than that. That is, helping several sectors inside a company, like sales, customer support, and customer attendance.

For that reason, it has also become an essential tool to stand out from the competition while offering the best customer experience.

Through clear and reliable data collection, processing, and storage, a brand can custom content, offers, and ads according to both individual profiles and segmentation groups. Which, by the way, the CDP itself creates.

Additionally, all types of data are read by the software. Though it collects and gives preference for first-party data, it can also work with second and third-party data. What it does is select and separate what data is actually valuable for the company, putting it in storage, and what’s not. 

Here’s a detail to remember: it does this selection considering the regulation (GDPR).

Is there anything else you need to know about the CDP?

Of course there is. The CDP is a huge program that does a lot more than help you with GDPR. Inside its system, there is a client history. Thus, more than an individual profile per customer, it’s also possible to understand how each of them behave online — what kind of purchase they make, which products they’re interested in, etc.

What we really want to say here is that the Customer Data Platform meets your GDPR needs. Plus, it keeps you worry-free in relation to unreliable or illegal data usage.

So, even though we still would have a lot more to talk about with the CDP, let’s just highlight this: with this software, you only use information to personalize content provided by the client, him or herself!

And what does that lead to? A double benefit for the company: improve CX and brand credibility.

How to get a CDP?

You probably have no more questions left regarding the need of a CDP for accomplishing GDPR regulation. But you might still be wondering how to acquire a CDP solution.

The first step is simple: do your research.

Once you know what is in the market, you can easily pick a platform that will meet all your needs. 

You don’t need much more than that. Once you acquire the CDP, set it up and start using it. Simple as that!

Here at Arena, our platform is a guaranteed solution for working with Customer Data. With over a thousand clients, we know how to deliver what you’re looking for. Besides, we also have some other solutions to make your customer experience strategy go up the charts such as Live Chat, Live Blog, and Content Wall.

Now, back to our main topic, let’s see what’s next:

What are the CDP benefits for data usage in the GDPR era?

Along with some benefits already mentioned, like the complete work with Customer Data, there are other advantages that make the CDP complete software that any company should get.

For example, the possibility of all company employees to have access to the data — with due permission. Whether it’s a sales rep, customer support, or product developers.

Especially in the Customer-centric period we’re currently in, allowing every sector to have access to this customer data just makes the job easier and the strategy maintained with efficiency.

Now, there are three other reasons to have a CDP that are directly related to the GDPR project:

Low cost

In spite of not being the cheapest data control tool in the market, it does stand out as the most complete and provides the best price-performance ratio. One of the reasons that makes this possible is that the platform is already built and programmed without the need of an IT support team.

That is to say, you simply acquire the Customer Data Platform, make some basic configurations, and start benefiting from it. No need to hire a platform support team or anything like that.

Another thing: this tool is faster than others that work with data, such as the CRM. In addition, your goals will be reached easier and, likewise, faster with it.

Individual and unified profile

What happened before CDP came to the market was data duplication.

Let’s explain this better:

A system like CRM, for example, doesn’t have the capability of recognizing different actions made by the same client. So, if someone interacts with the brand through the website and then by email, the software thinks it’s two different people.

With the CDP, that problem doesn’t exist. It is built to identify and unify these actions into a singular customer profile. Thus, avoiding data duplication.

No matter how many interactions or where they take place, the platform will be able to understand it is the same person and gather the information in the same place.

Easy external access

Okay, so, we’re talking about how CDP is superior to other data collection systems. This doesn’t mean you need to get this platform and get rid of everything you currently use. Not at all. 

The Customer Data Platform has the ability to connect with other systems, so you can take advantage of all the data you already have by connecting your platforms and centralizing all data into one place.

Even more, if there is incorrect, duplicated, or data going against GDPR, the CDP can correct and/or delete this information.

This way, before you waste your current database, make sure if it’s worth it or not to practice this integration between platforms.

Moreover, other software that is not directly related to data collection could perform better with the help of a CDP database. Don’t hold back doing your research.

So far, you’ve learned some of the main tasks of a Customer Data Platform, but there is still a lot more to know about it. How about reading our ebook on the subject? The download is free and the knowledge is uncanny!

Ecommerce Customer Experience: how to optimize it

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A good eCommerce customer experience offers much more than just speed and ease: it fits customers’ preferences to increase their lifetime value and keep your churn rate low.

It’s no secret that people are shopping online more and more. With social distancing, the average customer profile has evolved and adapted to navigate and make eCommerce purchases.

Ecommerce has been a key channel in retail, marketing, and sales operations, to the point it globally represents three-quarters of the overall retail growth. According to Statista, eCommerce sales are supposed to reach almost $604 billion in 2021.

Whether eCommerce sales are made overseas or regionally, one thing is true: The customer is at its center, and offering an at-least-good customer experience is a basic requirement.

Still, that is not what we usually see these days. Regrettably, it is very common to find bad eCommerce customer experiences, such as buggy checkout processes.

Well, that’s no laughing matter. Losing a customer in the checkout process means you’re saying goodbye to the most concrete revenue you might be able to get.

Why is eCommerce customer experience so important?

Owning an inventory and simply selling it isn’t enough, especially in the competitive market we witness today. Products and services aren’t differentiators anymore—but good eCommerce customer experience is.

An eCommerce experience refers to the quality of the interactions customers have in digital stores.

To achieve acceptable levels of quality, the user interaction should match customers’ expectations and provide them with fantastic eCommerce customer experience—there is where its importance lies.

Customer experience decides if you’re selling or not—literally—when it comes to eCommerce. 

The following statistics, provided by CX Central, make it clear:

  • After going through a poor experience, 89% of customers say they have stopped buying from a brand
  • Customer experience is overtaking price and products as a key brand differentiator
  • Eighty-six percent (86%) of customers are willing to pay more for a better customer experience
  • In general, 61% of people have a better opinion of brands when they offer an excellent mobile experience
  • Around 25% of online shoppers leave the website without paying if they find the website navigation too complicated

As you can see, offering a bad eCommerce customer experience is the way to chaos. Simultaneously, a good eCommerce customer experience is the way to customer engagement.

But how can you avoid being in the bad eCommerce statistics?

Keep in mind that every and each eCommerce operation should be built considering how the customer feels throughout the buying journey. 

If customers feel bad about your brand while on your eCommerce, they won’t hesitate to open a new tab and search for your competitor quickly. Competition is a few clicks away.

This means you have to offer a seamless, intuitive, eCommerce customer experience.

What makes a good eCommerce customer experience?

A good eCommerce customer experience should allow your customers to move through your online shop with speed and ease while matching their personal preferences.

This might differ from customer to customer – that’s why it is important to know them deeply.

In case you’re in doubt whether you’re offering a great eCommerce customer experience or not, there are a few KPIs that can help you get your answers.

We know a large portion of customers abandon the cart because that’s how they browse eCommerce. 

Still, according to Baymard, the main reasons for cart abandonment during checkouts are too high extra costs (50%), eCommerce demanding customers to create an account (28%), and too long checkout processes (21%). 

Another interesting statistic is that customer retention in eCommerce is 5X cheaper than acquisition. 

This suggests that keeping your customers and increasing their Lifetime Value (LTV) is a great way to keep ROI coming back to you. If your customer LTV is good, you might want to keep it high to benefit from consumers’ engagement.

With this in mind, we’ll move forward to some eCommerce customer experience trends that are extremely promising for the upcoming months.

1 – Personalization

You wants your customers to feel like you care about them, right? 

The best way to ensure them you do is to offer them interactions that match their context.

By basing its campaigns on factual data, eCommerce can deliver highly personalized and relevant offers to customers throughout their lifecycle and buying journey.

This means more accurate product suggestions, tailored loyalty points, smart follow-up emails, and more, to guide your customers more easily in the journey.

Please pay attention to the fact 71% of consumers express some level of frustration when their shopping experience is impersonal. On the other hand, 80% of them are more likely to buy from brands that offer customized experiences.

Tailoring a specific eCommerce customer experience based on customer data is no longer a futuristic idea. It is here, and people are demanding it.

2 – Flexibility

Customers expect to buy from anywhere at any time. This means providing them with:

  • A wide variety of paying methods on the checkout page
  • Search bars so customers can quickly find products they’re looking for
  • A small number of input fields in the checkout process
  • Fair price policies that don’t scare buyers away

Are these all? In fair honesty, they aren’t. Granting your customers with flexibility goes much further, and it starts with understanding what their preferences and hopes are.

The omnichannel market, for example, is growing at an impressive speed due to customers’ need to create deeper connections with brands as fast as they need to.

Whether customers want to shop online or to go in-store and have their package sent to their houses, omnichannel embraces countless opportunities across digital platforms and physical operations to deliver customized customer experiences.

This creates a competitive advantage and levels your eCommerce customer experience up.

3 – Human connection

The average Americans see from 4,000 to 10,000 ads daily. This massive advertising has contributed to making customers feel overwhelmed and make them harder to reach effectively.

When getting involved with brands, customers need to understand root-causes to allow an emotional connection. 

This isn’t something that paid ads can tell them, so eCommerce needs to take a step back and focus on organic storytelling techniques.

By focusing their attention on unique, personal brand experiences, businesses can upgrade their marketing campaigns and shopping journeys to build an outstanding eCommerce customer experience.

How does that affect your eCommerce directly? Well, this is a fantastic opportunity to use videos and live content to tell your story in an appealing way to attract and retain customers.

This is also a sign you should focus on more effective human support. 

For example, as much as people don’t mind being served by chatbots, 73% of customers still love being supported by friendly representatives who provide excellent service.

4 – Convenience

Convenience is the key to a good eCommerce customer experience, so fast and free shipping is about to become a brand differentiator.

Hitches and slowness aren’t allowed anymore and might push the demanding, time-sensitive customer away.

Let’s say your marketing team has invested time and money in delivering a campaign to attract customers to a unique sales promotion.

However, as soon as the customers engaged with your campaign get to your eCommerce, they catch themselves face to face with slow loading times, confusing pages, and unclear product descriptions.

Let’s also imagine that, as soon as customers put the products in the cart, the price previously exposed to your eCommerce suddenly increases.

Bad news: You have just wasted all the money your company invested in an effective acquisition campaign.

Studies say 14% of customers percent will begin shopping at another site when waiting for a page to load. Imagine how negatively this can affect your churn and conversion rates.

By neglecting convenience, there is a high chance your metrics towards digital initiatives might not perform the way you’re expecting them to and indicate opportunities you’re losing in the business.

Ways to improve eCommerce customer experience

There are many ways to improve your eCommerce customer experience once you decide to invest in meaningful customer-centric experiences.

One thing is universal for picking and implementing the right technologies to optimize your eCommerce customer experience: your improvements must be data-based.

This means every page and feature on your eCommerce should rely on vital customer information, such as what type of interaction your consumers prefer depending on the journey stage they’re at.

For example, have you ever considered developing a solution that allows your customers to buy from you while driving? Or delivering your products to consumers’ vehicles and other appliances?

Perhaps one of the above might make huge sense and generate even more value to your customers. But you’ll only know for certain if you rely on trustworthy customer data.

This is such a trend that customers will agree to sell their information to brands they choose. 

Whether it is their in-store movements, their location, or online browsing, customers are aware data access is essential to create personal experiences—and they’re counting on you to use it wisely to reward them with the best eCommerce experience ever.

Many eCommerce leaders and professionals worldwide have been doing that and benefiting from Customer Data Platform outcomes to personalize and elevate their eCommerce customer experience.

Improving your eCommerce customer experience with a real-time engagement platform

In the process of improving your eCommerce customer experience, you should strongly consider a few tools to help you build the best user experience.

Arena’s real-time engagement platform is the choice for you. It is equipped with Live Blog and Live Chat that can easily be embedded into your eCommerce to generate leads, increase engagement, and boost your revenue.

Keep reading to find out how both tools can optimize your eCommerce customer experience. We highly recommend checking out how Shoply leverages Arena for their Live Shopping experience.

Live Blog for eCommerce

A Live Blog is a new way to blog that embraces live content to a real-time audience.

When you live Blog, you combine different post formats and sources to create a refreshing coverage feed with the latest news towards an important event in your field. 

Live Blogs are huge in many sectors, such as sports, elections, protests, and conferences. However, these powerful engagement platforms can do much more, especially when we bring your eCommerce to the scenery.

Could you Live Blog a product launch? Sure! Could you live Blog a new promotional sale? Yes! Could you live Blog a special gathering for your loyal top-level clients? Absolutely.

Live Blogs transcend the way blogs have been building content over the years and should be adopted by eCommerce’s that care about the content they’re providing customers with.

Live Group Chat for eCommerce

Have you ever considered working on your eCommerce to embed tools that promote customer real-time interactions 24/7?

Live Chat Groups are an amazing option to achieve that!

As the name suggests, Live Chat Groups are chats that can easily be implemented on eCommerce to allow real-time conversations between your customers and representatives and your customers alone.

By implementing one on your eCommerce, you allow new types of interaction that add on more credibility to your pages and don’t make your customers wait for a response when customers reach out for you.

Live Chats have been used by support and sales teams for years, but now marketers have opened their eyes to its potential to engage and offer excellent customer experiences.

The advantages of Live Chat Groups are:

  • Availability: Consumers want businesses to be available 24/7, and Live Chat Groups are always there to prevent your customers from waiting for a response
  • Support: Sales representatives use Live Chat Groups to give customers great support, whether they’re in the checkout process or in doubt about a specific product
  • Real-time engagement: Replying quickly to customers should spare you the chance to leave them without an answer and lose them to other eCommerce on your field
  • Lead generation: Want a fast, simple tool that collects customer data and lets you smoothly guide shoppers through the customer journey? Live Chat is the answer!

As you read, consumers are expecting your next eCommerce customer experience move

We know how fast you need to implement changes that will give you quick and remarkable results. 

That is why we have decided to let you download our engagement platform for free and get started as soon as you want!

Start now and add Live Chat and Live Blog to boost your eCommerce customer experience!

Reasons you should work with a CDP (Customer Data Platform)

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Why should you invest in a Customer Data Platform? They are revolutionizing the business market, and there’s a reason for it. This system gathers all customer data into a singular font and creates a supreme tool to gain a competitive edge by providing unique and excellent CX.

The future of marketing is working primarily with customer data. This is already happening and has been occurring for a few years now. Data can talk about identity, contact, and even demographic information. But most importantly, online behavioral data is the factor that really makes a difference in understanding how to converse with the audience.

On top of that, data also generates knowledge about the market. So, more than getting to know the consumer, you understand better how to position the brand to attract the public’s attention. Working around the consumer requires a means to control all the information received. As consequence, the Customer Data Platform software was developed.

The CDP system gathers data from all available sources and organizes it in a database. Then, marketing and sales professionals can easily access that information and work on content creation. Besides, it provides insights for campaigns and new products (or modernization of existing products).

Read on to learn more about the importance of having a Customer Data Platform and how it helps businesses grow.

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Why is the Customer Data Platform so important?

A Customer Data Platform is a software designed to collect online and offline data. It deals with three main objectives: collect, analyze, and execute data. Though it was specially developed for marketing teams, it can still be used for other sectors inside a company.

With the organization of all available data, a marketing team’s work will be a lot simpler. By the way, the information contained inside a CDP comes from various sources: website, in-apps, social media, etc. One of the reasons the Customer Data Platform was created was to have all of the data generated from multiple sources gathered into one singular system.

The aim of putting together all information available about customers is to understand them better. The importance of knowing your consumer is undeniable, and the CDP can create an ideal consumer profile from the data collected. 

This means marketing teams have a goldmine in their hands. From the information found within this software, these professionals will know exactly who to talk to, how to speak, and even the best time.

Also, Customer Data Platforms work with real-time data collection. In other words, it gathers data from the first interaction of a user with the brand — whether that’s a visit on the website or an engagement on social media. And it’s not only about the information they share with the brand, like names and emails. So, even if that user doesn’t share anything at the start, their online behavior is already being stored.

It’s worth mentioning that everything is automated in the CDP, from the collection to analysis and database storage. Therefore, marketing professionals have to access the system and start creating content and campaigns.

Why work with customer data?

The reason to acquire a Customer Data Platform for your company is to work with customer data. In this scenario, you can pretty much ask yourself, “why to work with data collection at all?”. The answer to that question could not be more clear: to provide a better customer experience.

Have you heard about the customer-centric strategy? That’s a method of putting the customer in the center of every decision which most companies use nowadays. The reason for that is simple: customers are more demanding than ever before. 

Because the internet has so much information available, it’s harder to create a product or service that will make a person become a customer. Or, even more, make a customer loyal to the brand.

The only way to get to know the consumer and succeed in giving them the best experience is customer data. That is, all the information a company receives from the interaction with a client. Since these are known facts, working with them avoids speculations that could be way off the real deal.

Additionally, some benefits of managing customer data include better segmentation, personalized communication, broader audience understanding, an increase in revenue, and humanization of the brand. 

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That last item is related to what a customer expects from brands. They want the brand to connect and engage with them — just as much as the company wants their audience to interact and communicate too. Customers value their overall experience. It’s much more than only the purchase of a product.

To have a more appropriate data organization, companies invest in platforms that assist in analysis and make their daily work easier. These can include CDMs, CRMs, and CDPs.

What are the types of data?

Of course, to comprehend the best solution for your purpose, you might need a little more information on the types of data that can be collected. Because of that, here’s an explanation about what cookies are and also first-, second-, and third-party data.

Cookies

Cookies are probably the most famous type of data. It’s actually a package of data the computer receives when you first access an online page. After the cookie is on the PC, it will continuously send information to the company every time you access their pages.

More than tracking activities inside their website, cookies also have the function to store information that makes navigation more practical. For example, login and passwords — also called authentication cookies. 

Session cookies and tracking cookies are also varieties of cookies that gather when visitors are active, and the number of visits made to the same page, respectively. In addition, they have an important role in saving information for eCommerce. To clarify, if there were no cookies, shopping carts would be reset every time someone left the page to look for more items.

Even though they are so useful, their minute in the spotlight is coming to an end. Mainly because of privacy issues, cookies have become a concern for the audience. For that reason, browsers have decided to end the support of using cookies. Since cookies’ future is basically non-existing, companies are already looking for new ways to gather and access customer data.

First-party

This is the data collected straight from the relationship between customer and brand. Every piece of information gathered by the company itself can be classified as first-party data. It can be generated from monitoring the website, marketing campaigns, social media, etc. But also from website analytics platforms, CRM systems, and business analytics tools. 

This is the best type of data to work with. It’s the most trustworthy and reliable data. More than that, it’s also confidential data — since you are collecting it directly from your consumer, no other company will have that same information.

Of course, if there is no customer-brand interaction, no data about that person will be collected. That’s not exactly a downside, but it’s important to mention. That way, if your goal is to expand your audience, first-party data isn’t so recommended.

Second-party

Despite not being so talked about, second-party data is real. It’s essentially first-party data from another company. The idea is that you create a communication with a brand that has the same niche, but different products. Seeing that you’re not competitors, you can share each other’s first-party data and expand the brand’s audience.

This agreement between two companies can be an excellent means to improve your audience targeting as well. Further to this, you might create a bond with a powerful ally in the market.

Third-party

Third-party data can be used for the same purpose as second-party; however, it comes from a different source. That is: the information is bought from an external data provider.

Usually, companies that work with an incredible amount of data can decide to sell this information for other companies. Like most things in life, there are ups and downs. The positive point about buying customer data is that you’ll have a lot to work with, grow your audience, and practice better targeting. Moreover, purchased information is wide-ranging and can be used for several purposes.

On the other hand, this information is not exclusive. There are high chances of your competitor ending up with the same data package as you. This data isn’t so reliable since you don’t know where it came from and from who it is — the information is anonymous. Lastly, there’s also the chance of violating data privacy regulation.

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How to use data-driven marketing with a Customer Data Platform?

The primary intention of using customer data is to manage marketing strategies. This has become so huge these days. We even have a new expression in the business world: data-driven marketing. This is about creating a better experience and communication for the customer through data collected. Sound familiar?

A Customer Data Platform brings some benefits to the company that wants to practice data-driven marketing. For starters, the capacity of originating their own database. This gives the brand more control of sources and customer privacy. Easy access to information and anticipation of customers’ needs also get on the list.

The software will also have processes automated, meaning it’s easier to understand what data is essential and what can be left aside for the moment. As previously mentioned, each type of data is good for a specific strategy. Do you want more audience engagement? Get some first-party data. Do you want to expand your audience? Then work with third-party data.

Nonetheless, if you want to stand out in the market, use a combination of both types of data. That’s the most powerful tool you’ll have in your hands. And you know how it’s called? It’s the Customer Data Platform.

Why should you work with a Customer Data Platform?

There’s a whole list of reasons any company praises growth and customer satisfaction should acquire a Customer Data Platform. Some of those include:

  • knowing the consumer
  • improving relationship and engagement
  • creating tailor-made content
  • avoiding data silos
  • improving ROI
  • boosting predictive marketing

Coming from a wide variety of sources, the compilation of first-, second-, and third-party data into a singular system allows the Customer Data Platform to create the ideal customer profile and also unified customer profiles. Both of which will assist in a brand’s communication strategy.

More than that, the CDP works with real-time updates and connects online and offline data. Can you think of a complete database than this? Acquiring this solution will guarantee you better results in marketing campaigns.

Of course, a Customer Data Platform can be used as more than a marketing tool. It can help sales teams, product development, customer support, and pretty much all company sectors. Arena offers a CDP solution so you can work towards all your goals.

That being said, we want you to thoroughly understand what we do and how to use a CDP to your advantage. Because of that, we’ve created an ebook to explain more about it! 

Download it for free now: Customer Data Platform 2020: the future of marketing and sales.

How to Improve eCommerce Customer Experience

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Satisfaction is the word of order. To reach it, the customer experience (CX) for your eCommerce must be on point! Read on and discover how you can improve yours!

All eyes are on the customer now. Whoever dedicates strictly to price is faded to be eaten up by companies serving one moment.

Consumers are more demanding than ever before. Online shopping has become an ever-growing search for the most positive and memorable experience.

On the other side, eCommerce needs to understand its own customers to offer what they really want to get.

So, the faster you assimilate what your brand must do, the bigger will be your returns. Follow up and start right now!

Why is Customer Experience so crucial to eCommerce?

The relationship established between the industry and customers is not supply and demand anymore. It goes far beyond selling. This is a Customer-Centric era! Besides offering an excellent service or product, you must serve a memorable experience, adding value not only to your merchandise but to your whole brand legacy.

Since your company is directly competing with other names offering the same item, with the same level of quality, and the same price, providing an excellent experience to the customer has become the way to stand out, especially in eCommerce.

It is necessary to understand the needs and explore them, making sure satisfaction is present throughout every step of the buyer’s journey.

Dive in your customers’ minds, know their personality, treat them as individuals, be empathic. No one likes to be ignored or mistreated. After all, satisfied customers tend to buy more, put great referrals out there, and positively qualify your company.

How can your eCommerce improve Customer Experience?

The customer experience begins long before the purchase and ends, well… that depends on how deep is their connection with you. Also, aspects including the longevity of the product or service and, most importantly, the degree of emotional involvement to your brand are determinants.

The process of customer experience can start with a personal dream, desire, or status someone seeks for. Whatever is the trigger, customers will join a journey craving for more information to make a dream come true.

With all the accessibility and variety of information provided out here, you must be fully ready to catch their attention at the first click on your eCommerce. They will find out everything about your product or service before addressing any salesman.  

They will build expectations, imagining themselves owning your product/service, feeling the sensation, the joy, the happiness. That is why the entire process has to be flawless. Your customer is preparing their life for that purchase moment.

Although, if they go through any bumps along that ride, anything that negatively influences them, their minds can change in a second, and your eCommerce will lose a sale.

What are the best practices?

Since the idea is to generate a level of satisfaction that your customer will come back to you for any time they need something, here are some best practices you’d better know.

Listen to your customer

A Customer Data Platform (CDP) is responsible for gathering, in one place, the entire database of your company. For eCommerce, this functionality is particularly useful, as it helps to increase lifetime value (LTV) and decrease customer acquisition costs (CAC).

Integrating multiple touchpoints is essential to boost consumer loyalty, increasing the relationship between the brand and the customer. A CDP can integrate all customer data sources through a clean and unified registration system.

By that, marketing and sales can create campaigns with even more personality for your client. With a unique approach aiming for customer experience, it is possible to increase conversion chances, maximizing the average ticket without having to acquire new clients.

When crossing complementary information, it gets easier to identify different customer clusters. For example, you can build a segmentation for those who add products to the cart but leave before buying and those who purchase and may be open to new experiences on your eCommerce.

Holding those types of information, strategy becomes more curated, and ad campaigns get more effective. Then, investments can be directed to where it matters instead of giving blind tries and wasting money.

Put empathy first

We can immediately say that being empathic to your customer makes your eCommerce service a personalized, opening space for the exclusive.

We have mentioned a few times here in our blog that the customer knows exactly when someone is pushing them to buy something ––, and you do not want to be that person!

Letting the audience know your products or services are designed by excellence also includes how you connect with them. By serving empathy in your day-to-day, you make the buying process more flexible.

As a result, your customer will understand you are solving their particular needs, and not just making another regular deal.

Create relevant engagement

Customer experience for eCommerce is a 100% induced process. Your strategy team is in charge of building the most extraordinary journey. A golden tool to accomplish that is Live Chat.

A professional Live Chat solution allows you to monitor, in real-time, how many visitors are on your eCommerce and what pages they are browsing and products they are looking for. It is also possible to know if they are evading the buying process to make a proper intervention to reverse the situation.

Those proactive Live Chat invitations break the barriers of reactive positioning –– when your brand waits for the customer to call you. Approaching visitors in real-time completely changes the dynamic and the relationship between sales and customers.

By acting proactively and showing you are there, available at any time, you have better chances to enhance eCommerce’s customer experience.

It turns essential to mention that every step of this type of engagement is strategically designed to be data-based. There is no guessing or trying in the dark. Unexpected behaviors here can instantly ruin the deal.

Prepare your teams

Another great way to provide a better customer experience for eCommerce is by investing in proper training for your support team. Courses, workshops, digital content: there are plenty of ways to educate and create better service.

It is also fundamental to listen to your team’s reality, encouraging them to share their perceptions, give feedback, and improve the process along the way.

Establish a safe and open communication channel between you both. After all, a significant part of your success depends on them.

Simplify the buying process

Having your customer behavior mapped, you can identify –– or even predict through data –– some crucial details, especially when it comes to the buying process itself.

When you anticipate their common desires, you can display items or services to enhance their experience on your eCommerce and offer a smooth process to do business with your company. You improve the chances of higher revenue.

What metrics to measure about CX for eCommerce?

When we talk about customer experience for eCommerce, some important metrics work as a compass to indicate whether you are on the right track to achieve your business goals. They must be closely linked to the macro strategy, so the results operate as a cascade.

It’s worth mentioning that many managers focus excessively on operational activities indicators, such as the number of e-mails or social media posts.

Those are also important since you can measure teams’ productivity. But without the correct data analysis of performance, it is likely you are all wasting time and money.

General conversion rate

This one probably is very familiar to you. Also, a fundamental metric to evaluate how the customer is experiencing your eCommerce. The conversion rate index usually can point out bottlenecks on your website or strategy.

Aspects your team would not figure out quickly, demanding users’ behavior to identify it correctly. Gaps can be extremely dangerous to the entire process, causing exit spots before the purchase happens.

Shopping Cart conversion rate

A must-have indicator for eCommerce, this one measures when some products or service is added to the cart, but the visitor abandons the process before concluding the sale. By analyzing this metric, you can identify which stage they are evading.

That way, your teams can use tools like real-time updates, provided by the Customer Data Platform, to comprehend why it is happening and how to revert it. Also, you can still create a powerful retarget campaign using CDP to bring them back for those lost customers.

Net Promoter Score (NPS)

When it comes to measuring customer satisfaction and the possibility of making good referrals, Net Promoter Score (NPS) is one of the best known. A typical example of NPS is the following question: “How likely are you to recommend us on a scale from 0 to 10?”.

This metric can be used as a starting point for products or services standardization entirely based on data and customer experience.

As a business manager, the questions approached by NPS are essential to be solved. After all, you know if the customers aren’t satisfied with what they’ve received, chances are, they’ll get frustrated.

Customer referrals

The buyers’ journey is cyclic. It is not enough to have the right products and serve well anymore. The environment built by you must provide a prime time through every single step of customer experience.

When potential new customers see how your brand has been transforming clients, it kind of creates a shortcut between consideration and decision-making. For example, social proofs reveal the opinion of real individuals about the connection established with you and your service.

It could be a testimonial, a demonstration, photos, or even a five-star evaluation. The more referrals your customers put out there, the more authority your brand gets. And even though it may be not easy getting people to spend their time writing something positive about you, it is ok to offer some motivation in return, like a coupon or a gift.

What are the positive results of CX in the checkout process?

To earn customers trust and make them feel safe to close a deal, the checkout page has a massive role in it. From the beginning until the end, your customer experience for eCommerce must be consistent and cohesive, exuding security throughout the journey.

Withdrawals mostly happen at the checkout stage, whether it’s because the page is complex, or demands too much information, or because there are patterns the customer may not feel comfortable filling.

Picture yourself going through your checkout page:

  1. How simple and objective is it?
  2. Are the main points of the information displayed clearly?
  3. Is your checkout browsing intuitive?
  4. Can customers quickly understand that it won’t be too long?

Questions like those enlighten how your checkout page should be constructed, focussing on customer experience.

Here, a bonus tip is to always pay attention to the type of devices being used to access your pages. If you neglect the sources, you will be shutting down several entry doors. You can get that information using the Customer Data Platform.

How can CX generate more revenue?

Nothing can push customers away more than a bad experience. Therefore, to ensure technological innovations lead you towards better results, more profits, and brand loyalty, eCommerce’s customer experience must count on the right tools. Arena’s customers in the eCommerce segment, like Shoply, are already reaping the profits from offering an enhanced Customer Experience.

Just as your customer wants to keep it simple, yet meaningful, so should you when it comes to how to do it. That is why Arena gives you the most fantastic alternatives.

The first one is the Customer Data Platform. This is, by far, your ultimate top option. Every piece of data you need to create the best customer experience for eCommerce is on CDP. Click here and understand how it can increase your sales! Also, you can have a Live Chat solution for free on your website in three simple steps! Within minutes, get this powerful tool right now and boost customer experience on your e-commerce.

Customer Data Platform: where audience data and sales strategy meet

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Are you having trouble improving conversion rates and connecting customer insights from different touchpoints? A Customer Data Platform helps you understand your audience in a granular way and enables you to craft better campaigns and product offers.

Understanding customers always required brands to look at their audience through different lenses – whether through other marketing channels, relationship platforms, or customer segments. On the verge of Big Data culture, however, just having a fragmented view of your audience is not enough anymore. 

What drives sales is the ability brands have to deliver a cohesive customer experience (CX) across different channels, which is only possible by fully understanding channel correlations and cause and effect connectors along the audience’s touchpoints. 

These days, people interact with brands more often than ever before, and so making sense of different interactions is a lot more complicated than it once was.

Recent research by Ascend2 and Research Partners consulted more than a thousand marketers and found that 43% see data integration across different platforms as one of their main goals. In contrast, 37% wish to enrich data quality and completeness.

No wonder executives are investing more and more in their technology stacks: one-third of industry professionals believe it’s essential to have the right technologies for data collection and analysis, according to a study by Digital Doughnut. Currently, 44% of marketers say they already have data management platforms.

But amongst all data platforms available, the Customer Data Platform is undoubtedly the best you can have if your goal is to understand your audience better and drive more sales. We’ll show you why!

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What is CDP? And how does it work?

A Customer Data Platform (CDP) is a software that unifies customer data from different data systems and customer-facing platforms. It combines customer’s demographic data, buying history, social media and content preferences, call centers, and customer navigation data. 

Once implemented, the CDP acts as a 360º data solution: it collects, filters integrates, and analyzes customers’ data in real-time. 

CDPs can ingest structured and unstructured data from Customer Relationship Management Systems (CRM), Data Management Platform (DMPs), customer support channels, eCommerce websites and apps, payment systems, social media, etc. They also track behavior across different devices.

By acting as a hub for many data sources, the Customer Data Platform allows marketers to build a holistic view of single customers and their pain points. 

But how exactly do they organize so much data? Well, CDPs rely mostly on first-party data so they can determine the so-called Unified Customer Profiles, which are profiles based on information from real customers and prospects.

That makes the data match consistent across different platforms, and hence the audience insights end up being much more reliable for marketers.

Check out some practical examples of data collected by customer data platforms:

  • Transactional data: order details, customer and product value, renewal dates, abandoned baskets, stage in the conversion funnel
  • Behavioral data from web and mobile: Products and categories browsed, clicks, store visits, interaction data, number of pages visited, etc
  • Profile data: Contact and opt-in data, psychographic data, details about channel and content preferences, lifestyle, etc
  • Brand Relationship Data: Email interactions with customer support, social listening insights, social media comments, etc

The end-to-end role of a Customer Data Platform (CDP)

In today’s competitive landscape, marketing executives are expected to keep track of all customer interactions and connect marketing efforts to other departments, such as sales and customer success, to provide customers with a satisfactory customer experience (CX).

The rush for data management optimization is seen clearly by the CDP industry’s growth in recent years. According to the Customer Data Platform Institute, the number of CDPs available in the market doubled from 2017 to 2018. Now, there are more than 50 CDPs in the industry worldwide.

The truth is that CDP can be an asset for every department within a company, working as an end-to-end solution to enrich customer experience. We’ll soon explore how brands can use CDPs to drive sales, but first, let’s explore CDPs’ overall benefits for companies. 

Breaking Data Silos

CDPs integrate data from multiple departments, which encourages different teams to collaborate and speeds operational routines. With a CDP, marketing, sales, customer experience, and support teams can be on the same page regarding customers’ needs.

Automating marketing workflow

Because they automate a lot of the data integration and analysis, CDPs make the lives of marketing professionals a lot easier, freeing them from repetitive work and allowing them to spend more time in strategic planning. 

Speeding up decision-making

As data processing happens in real-time in the CDP, it also makes it possible for companies to easily spot changes in customer behavior and act upon them while quickly sharing relevant insights with different teams.

The power of CDPs in driving sales

As we pointed out, CDPs are an excellent liaison point for different departments and can be at the heart of customer experience management. But to what extent can CDPs contribute to final sales? 

There are many ways CDPs can directly or indirectly improve conversion rates, drive customer loyalty, and decrease churn and bounce rates. In fact, a report from Forbes Insights highlighted that 44% of organization leaders believe the Customer Data Platform is helping them drive customer loyalty and increase ROI.

We have made a list of 11 ways CDPs can help you drive sales while also better understanding your customer base. 

1) Know your customers across multiple devices or channels

The mandatory philosophy among marketers is that they should reach their customers on the right channel, at the right moment, and with the right messages and products. To do that, they need to let go of assumptions and understand exactly how users interact with them across different channels and devices.

With all such information concentrated in the CDP, marketers can tailor better experiences and advertising segmentation across devices, increasing campaign success chances

2) Accurately track shopping events

A CDP is a great tool for retailers and eCommerce as it tracks customers’ buying behaviors and relevant transactional data in significant volume. CDPs allow them to keep a consistent record of the products customers added to the cart, the duration of checkout and order completion, abandoned carts, and other information that is crucial for online operations.

3) Improve pricing 

Collecting data from many sources – from your eCommerce website, app, or even physical stores – CDPs help you clarify how much customers are spending and how much they are willing to pay for your products according to their stage in the customer journey, search, and navigation patterns. 

CDPs can also be connected to your supply chain systems to help you adjust costs and manage the relationship with suppliers, which are aspects that often impact pricing. With such information updated in real-time, you can be more assertive in your pricing strategy.

4) Offer personalized discounts and product recommendations

Having a holistic customer profile at hand also allows brands to offer clients personalized discounts and product recommendations that ultimately can turn them into loyal customers.

A study by Salesforce shows that 57% of customers are willing to share their data to exchange personalized offers or discounts. In comparison, 52% will share their data in exchange for product recommendations that meet their needs.

While knowing customers in detail, companies’ teams can offer precisely what users need to advance in the sales funnel – whether it is a discount, a free trial, reviews from peers, or a personal approach from the support team.

5) Connect physical and digital shopping experiences

For retailers that also operate offline, a CDP can connect insights from online and offline systems, which is often a challenge for companies looking forward to addressing omnichannel experiences. A survey from the CMO Council found only 7% of respondents said they are always able to deliver real-time, data-driven experiences across physical and digital touchpoints.

With a CDP, brands can offer better customer experience from the website to the physical store – and vice-versa – increasing sales opportunities.

6) Be quick to react to customers interactions

Being quick to answer customer’s signals is also crucial for both customer acquisition and retention strategies. Still, many marketers struggle with the amount of real-time insights they can access and act upon. 

Research published by MediaPost, commissioned by technology consultancy Vanson Bourne, shows that only a minority of marketers feel they can immediately react to online customer interactions. According to the study, only 43% act quickly over customer behavior in the pre-purchase stage, 38% during purchase, and just 35% in the post-purchase phase.

By providing CRM, sales, and marketing teams with a continuous data stream, CDPs can make customer data more actionable. Isn’t that the point of having so much customer data? 

7) Prevent churn and cart abandonment 

Retail managers and online marketers are often investigating why customers abandon carts or churn after a few purchases. A CDP can give you deep insights into what stands in the way between your customers and the checkout.  

It helps you spot gaps throughout the entire customer journey (and not just in specific channels) that might be leading customers to give up purchases. Are there problems with website usability? Is your customer support too slow? 

By figuring out what is wrong, your team can work on fixing these gaps and segmenting churn prevention campaigns to attract customers back. 

8) Optimize Customer Acquisition Costs (CAC) and Conversion Rates

The McKinsey Global Institute estimates that data-driven organizations are 23 times more likely to acquire customers, six times as likely to retain customers, and 19 times as likely to be profitable. 

With the Customer Data Platform’s assertiveness, companies can better streamline marketing segmentation and customer success efforts, thus optimizing results related to Conversion Rates (CR), Customer Acquisition Costs (CAC), and Customer Lifetime Value.

9) Qualify your leads

One of the best aspects of CDP for sales is that it allows you to qualify your leads better and nurture the relationship with customers across their entire lifecycle. Not only it supports marketers in optimizing strategies to attract qualified customers; it also gives you the necessary information to engage with customers who are ready to buy. 

A study by Forbes shows, for instance, that 53% of marketing executives are using CDPs to engage with existing customers’ needs, increasing the likelihood that they will become recurring clients and the chances of upselling them. 

10) Enhance predictive marketing

Predicting customer behavior and preferences are what helps giant retailers like Amazon to drive sales. This marketing technique, which determines the probability of success of different marketing strategies, is essentially fueled by high volumes of customer data, which only a CDP could support. 

Armed with a CDP, data scientists and marketing analysts can gather data from several sources and apply predictive models with a great accuracy level.

11) Improve attribution models

With so many touchpoints with the audience, it is often difficult for companies to determine accurate attribution models and discover which channels drive more sales. According to Google, almost 80% of all transaction value involves at least two marketing channel interactions – a number that can be much higher depending on your business’s complexity.

The Customer Data Platform can optimize the attribution framework since marketers can send attribution data to the CDP and have a more accurate view of campaign performance.

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Why CDPs are more complete than other data management platforms

So you have learned the many benefits that CDPs can bring to the table. Many leaders still ask themselves if they should ditch their existing data management tools for a CDP. What has to be clear for marketers and sales managers is that different data platforms don’t need to exclude each other. 

A Customer Data Platform can potentialize the outcomes of Customer Relationship Management (CRM) software and Data Management Platforms (DMPs).

In a survey by The Relevancy Group conducted in 2018 with US executive marketers, about 6 in 10 respondents said they were integrating CRM data into their CDP. 

From a digital advertising perspective, CDPs can make the work of Data Management Platforms a lot more precise as well – with at least 29% of marketers feeding CDPs with digital advertising response data.

Although CDPs, DMPs, and CRM systems share some similarities, they all have different purposes within a company, with CDP serving as a primary data hub to make your teams more confident in responding to customers’ needs. 

Want to become an expert in CDP?

If you plan to purchase a CDP for your company, the next step is to check out the platforms available in the market and consider which one is the best fit for your business goals.

If you feel like it is time to learn more about CDPs, we invite you to download our eBook Customer Data Platform: the future of marketing and sales.

The eBook will give you details about CDPs’ features, how they work, and how they can be incorporated into your marketing and sales strategies. We hope you enjoy it!

The secret to real data collection: why is a CDP key to your business

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Using a CDP is extremely important these days, but just as important is the need to understand why you need it. It’s more than collecting real data, it’s about how you chose to use, such as to improve your business.

Knowing who a brand’s audience is the most significant purpose of a company. It’s the only way to recognize the best way to communicate, find your public, offer them your product or service, and so on. Because of that, from the early years of the internet ascension, customer data collection has been discussed.

Many software and platforms were developed to gather data to help companies better target their audience. However, data collection can be a delicate subject regarding privacy matters.

Indeed, a General Data Protection Regulation (GDPR) aims to give the public more control of what happens to their online data.

While it was extremely common for companies to gather data and sell to third parties, this is now a bit more complicated — especially when it comes to data originated from cookies. Although collecting customer data is still common and required in the market, brands need to be more careful about how they do it and what kind of data they have in their hands.

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A business needs to have accurate data to provide a better customer experience. This means that working with purchased cookies won’t be the perfect solution since they’re mainly anonymous data. For that reason, solutions like the CDP are becoming more notorious. They’re a way to work with real data, hence accurate information, and find the most suitable marketing and sales strategies.

To better understand the search for real data and how a CDP will help achieve that, here, you will learn more about:

  • what happened to cookies
  • what is the importance of CDP
  • why use real-time data collection
  • how does CDP influence a company’s strategies
  • how does this affect relationships between customers and brands

What happened to cookies?

It has recently come to our knowledge that browsers like Firefox and Google are suspending their support to the usage of cookies. These are the text files that store a user’s activity online. They can be used to save some navigation information and make the process easier. For example, automatically filling a website when you’re reaccessing it, or collecting login information for a page.

However, the primary use is to save data about a user’s browsing history, such as pages visited and browsing time. As we all know, having this type of information is essential for excellent performance in digital marketing strategies.

Because of that, browsers used to support cookies and allow companies to access a user’s information for as long as the cookie was saved on the computer. This means that personal and browsing information would be shared with each company’s website for the same amount of time.

When talking about this subject, we can think of both first-party cookies and third-party cookies. First-party is the information that a company gathers directly from the audience, while third-party is data united from various sources. Other companies mostly buy third-party data.

Though when a company purchases data from another one, information is anonymous. You can’t really know who that person is, and data might not be so reliable. Other brands can also end up with the same information you have since the data provider can sell the same data “package” to anyone.

Because of privacy matters and the GDPR (General Data Protection Regulation), cookies’ popularity has been going down. People started using ad blockers so they wouldn’t be bothered with ads after clicking a product.

Even more, when Google decided to suspend third-party data sharing through its browser, the cookies’ future became quite unappealing. Now, brands that want to work with customer data need to find new ways to gather data — and work primarily with first-party data.

Hence, the CDP comes to the rescue. A Customer Data Platform is a software developed for marketing teams to create more useful content and campaigns. 

What is the importance of CDP?

Since it is essentially a marketing tool, the main reason to use a CDP is to know the consumer better. Analyzing and understanding customer data and behavior is crucial to create accurate content. In general, the Customer Data Platform gathers information from a wide variety of sources putting the pieces together to create the ideal consumer profile.

The entire process of data collection and organization is automatized. So the software does all work to give professional marketing information ready to use. However, several teams can have access to this data. All sectors in a company might need some context from the consumers before dealing with their tasks, especially sales and customer support. Still, the products and engineer teams can easily use the CDP information too.

Having data centralized into a single platform is a peculiarity of the CDP. That’s because there were other tools before it that worked with data collection, like the CRM, but none of them were as complete as the CDP.

Further to this, in the era of data-driven marketing, the process of decision making inside a company must be made based on real, accurate information. Since purchased cookies were anonymous, data could be compromised. On the other hand, with a Customer Data Platform, real data is at easy reach.

Accordingly, the service generates better results through the personalization of communication. Businesses that are continually looking for ways to improve ROI can find their needs fulfilled with the CDP. Being a data-driven company and working with real data makes you one step ahead of competitors.

 

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Why use real-time data collection?

It’s not only about data collection, but mostly about real-time data collection. What’s the difference, you ask? Well, working with anything in real-time is an advantage. In this case, it means that the data collection software, such as a CDP solution, will start gathering information from a person’s first visit to your page.

For the company, it is a strategy for improving the promptness of a response and communication system. Therefore, improving every customer-related service in the company. It’s no secret brands use CDP to have better customer relationships, audience engagement, and audience targeting.

Moreover, it is possible to classify visitors into customers and qualified leads as soon as they access your website. Equally, having a database with real-time data makes it easier to take actions that are on the spot, allowing you to see where the current strategy is failing and what needs to be improved.

Overall, working with a CDP makes the company look active and worry about treating customers the way they deserve.

How does CDP data influence a company’s strategies?

Whatever product or service you provide, there’s no doubt you have competition. Because of that, brands need to offer the best solution and customer service at every moment. Nowadays, it’s hard to catch someone’s attention, but extremely easy to lose it.

So, even though a company should work to create a good reputation in the market, no matter what, aiming to be ahead of the competitor is necessary. After all, having a customer turn into a brand advocate is not easy, but highly relevant to a company’s strategy.

Consequently, it’s required to offer the best customer experience out there. For that, you must know who your consumer is, ergo, the use of CDP.

A Customer Data Platform can gather data from multiple sources, from social media and in-apps to sales engagement and product use. This is what makes the software such a unique solution, since the more information you have, the more accurate the ideal customer profile will be. From then, not only marketing strategies will be perfected, but also sales and customer support.

As professional marketing, you know it’s no proper working with guesses in any business. Thus, making decisions founded on real data will lead to several benefits — including the increase in audience engagement.

How does this affect relationships between customers and brands?

When we talk about acquiring a CDP solution, the main reason is to connect with the customer. Thus, it’s logical that it’ll have an impact on the relationship between customer and brand. Since it’s possible to understand and know the consumer thoroughly, it thereby becomes possible to make them more satisfied by providing truly personalized service.

When customers are more satisfied, they are more likely to recommend your mark to other people. With the right after purchase strategy and content, they may even become brand advocates. And why is this so important? For a company, it means a better return on investment and lowers costs with customer acquisition.

After all, it’s less expensive to retain clients than to acquire new ones. That’s why many companies started working with a customer-centric strategy as well. If there are no customers, a business can’t survive in the market. 

Arena is a CDP platform that will revolutionize your company. With our real-time data collection system, all marketing and sales strategies will be refined and boosted.

To better understand how that’ll happen, download our ebook Customer Data Platform 2020: the future of marketing and sales. It has everything you need to know about acquiring and using a CDP to make your brand a reference.

How Customer Data Platform is reinventing customer relations

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Using a Customer Data Platform is helping companies to focus obsessively on their customers and benefit from their engagement.

You need to know your customers—this isn’t any news. It doesn’t matter if you want to make them more engaged, optimize your budget for campaigns, or improve your ROI.

Customer accurate information is at the heart of every company and should be treated correctly to generate powerful outcomes from your marketing efforts.

If you don’t have a consistent understanding of your consumers, then all your strategies will likely go down the drain.

But how exactly do you get to act like you know your customers? The answer is simple: by managing their data.

To treat data thoroughly and reach your customer relationship goals, you might come across the need to use the right technologies. This is when the Customer Data Platform (CDP) walks in.

A customer data platform monitors and tracks multiple data sources to bring relevant information to a single hub that is easy to access and understand.

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Once implemented, CDPs collect, integrate, manage, and analyze customer data continuously. These automated processes help many teams to focus on solving complex problems that require a human brain. At the same time, a Customer Data Platform brings current, real-time data to be leveraged and turned into marketing master plans.

Why do companies use Customer Data Platforms?

Is there a reason why companies implement a Customer Data Platform in their business models? Yes, many.

According to Gartner, plenty of marketers look to customer data-driven strategies to deliver growth. For example, marketers invested two-thirds of their budget in supporting relationships with their customers in 2017 and 2018. 

Still, they have found the technology they were using to be frustrating—until CDP’s unique upshots came out as a solution to their problems.

A Customer Data Platform reaches out for several channels and concentrates real-time data in a single place your team can access whenever it is convenient.

This stimulates a collaborative work environment and speeds the pace of operational routines. Customer Data Platforms are also known for making marketers’ lives less complicated since automating workflows would take too many working hours to be accomplished.

The other reason companies use Customer Data Platforms is that they are much more than a simple database. According to the CDP Institute, the ideal Customer Data Platform should contain five essential capabilities:

  • Absorb data from any source
  • Give full details of ingested data
  • Store data without end and frequently
  • Create unified profiles (such as personas)
  • Share data with any system that needs it

All of the five skills above drive brands into having a vigorous understanding of their customer base by collecting and analyzing reliable data across their marketing channels.

What types of data does a Customer Data Platform assess?

The types of customer data assessed by a CDP can be quantitative and qualitative. 

In other words, by using a CDP, you will be able to figure out:

  • How to identify your customers, using personal data
  • How to interact with your customers, using interactional data
  • How customers expect to be impacted by experiences, using behavioral data
  • How your customers perceive your brand, using attitudinal data

The datasets above are being generated at all times in any digital environment and should be combined to create an unbeatable and absolute customer understanding.

But how do CDPs gather such different information?

They reach out to analytics reports, engagement measures, support occurrences, eCommerce metrics, and customer feedback (to quote a few), to maximize your knowledge and equip you with fast, accurate moves.

This is the main reason why CDPs are revolutionizing the way brands communicate with customers and vice-versa. They are an unlimited and underlying base for companies to create remarkable customer experiences and increase customer engagement in a way we have never seen before.

The effects of CDP in customer experience

A Customer Data Platform grants companies an invincible competitive advantage: passionate customers who keep being fed with reasons to remain brand loyal.

Historically, we can see customers have adopted technologies faster than the brands they interact with. This made companies try to embrace digital transformation technologies focused on customer experience to reach out to consumers where they are and how they want.

Expanding your brand’s online presence to talk to customers in multiple channels isn’t enough, in any case. Any company can create an Instagram account and interact with its audience then and there, right?

However, the ones that truly stand out are focused on delivering personalized, relevant, well-designed interactions that take place as soon as customers want.

Tailored customer interactions should happen anywhere, at any time. This is the main reason why organizations around the world are digitizing their business models. According to the Boston Consulting Group Research, personalization will drive an $800 billion revenue shift to the top 15% of companies that work best on it, in only three industries.

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I know what you’re thinking: that’s much profit for a small number of companies—and yes, it is. Even so, it sounds like a warning: companies that aren’t ready to turn personalization ordinary in their marketing campaigns, will be left stranded.

As you know, doing a great job on personalization is all about knowing everything there is to know about your customers and quickly activating your knowledge when needed.

Can you notice any coincidences between this goal and the usage of a CDP?

How CDPs are reinventing customer relations

Suppose you’re leading digital initiatives to deepen the relationship between your customers and your brand. In that case, you should pay attention to the changes CDPs are leading in customer management and how it differs from other popular marketing tools.

A Customer Data Platform is way more complete than a Customer Relationship Management (CRM) software.

CRM will tell you how to personalize and improve existing customer relationships. Meanwhile, a CDP will do that and indicate how you can promote products and services and what you should do to attract new customers.

With the new untapped potential CDPs unleash, companies are increasingly confident in meeting market changes and customers’ preferences. Hesitating in our competitive world is no longer an option, and data-driven marketing plays a vital role in feeding companies with unequivocal customer interactions.

Ahead, we have numbered a few ways Customer Data Platforms reinvent customer relations to inspire you and your team.

1. CDP enables segmentation opportunities

While it simultaneously optimizes strategies, a CDP provides companies with a 360-degree view of customers to act on an essential customer experience requirement: segmentation.

Segmenting customers by specific traits, behaviors, attitudes, and others is a fantastic opportunity to create tailored marketing touchpoints throughout their journey and attract them with meaningful content.

When based on data, segmentation is an unmatched growth engine that encourages customer loyalty and enhances profitability.

2. A CDP gives your interactions a personal touch

Similarly, you can not spell personalization without customer data.

Owning a Customer Data Platform will help you quickly access reliable information to customize customer interactions, making your consumers feel special, and long-term relationships feasible.

Many companies are using CDP for Customer Data Management. See below how their tactics connect with top-level personalization:

3. A CDP enriches customer relationships

There isn’t enough emphasis on how knowing your customers is essential for customer relations.

People expect to be treated accordingly to their visions as much as they wish to connect emotionally with brands. A single miscommunication can harm brand-customer relationships irreparably.

As soon as you have a panoramic view of your customers’ habits, preferences, needs, and issues, you should feel more confident in building specific touchpoints that elevate the customer journey and make customers want to hang around you for longer.

Owning a Customer Data Platform will also measure your customer loyalty programs’ effectiveness and help you find what groups of customers deserve attention according to their life cycle.

4. A CDP is agile

Agile methodologies are the perfect response to a world that is changing every day, every hour. CDPs consider our ever-changing environment and let your team access specific data whenever it needs, contributing to an agility mindset.

Agility layers can be used to shape CDP frameworks that adjust to your company’s infrastructure, turning data sharing into a reality. CDPs also absorb data from other internal systems, like CRMs and Data Management Platforms (DMPs), you might already have.

Apart from that, CDPs update in real-time. This allows you to assess micro-moments data and instantly operationalize it.

5. A CDP ingests data from any source

Your customers are everywhere these days, right? You can find them on social media, navigate your website, read your emails, download your app, and take a look at your physical store. The interaction possibilities between your customer and your brand are countless.

If truth be told, it truly doesn’t matter where your customers are and what they’re doing. Whether they’re reading your blog or using your chatbot, data is being generated at all times, collected from simple interactions to complex operations.

A Customer Data Platform reaches out to any source of information, from Live Chats to SEO, from blogging to Twitter, from customer loyalty to affiliate marketing programs to provide your company with everything you know about your potential and current consumers.

6. A CDP elevates digital transformation

Simply, a digital transformation process should rely on—and a lot!—on a Customer Data Platform.

By watching digital-native organizations, it becomes clear that many technologies can be embedded to digitize businesses.

However, it is worthless to implement technologies that don’t accurately connect with customers’ needs. Digital transformation starts and ends with the customer, transcending traditional marketing, sales, and customer service roles.

That being said, without a reliable Customer Data Platform, companies who are digitizing their operations will mostly fail to unleash the real potential of a digital transformation.

Digital-native companies have already built their business model based on data collection and responding to customers’ needs with high-level experiences.

These companies combine traditional marketing strategies, such as loyalty programs, with groundbreaking digital initiatives that connect with customers in real-time and engross their engagement.

Remember: It is crucial to direct your digital transformation efforts into interactions that engage your audience, and a Customer Data Platform is intimately related to that.

It taps into your databases to unify relevant information and operationalize customer knowledge, delivering targeted experiences that will delight and retain your customers.

It should also be stated that CDPs assist companies in taking a step back and revisiting their processes to leverage technology cleverly.

For example, Netflix was quick to turn its service into a scalable streaming platform that replies to customers’ demands. The now-sector-leading company could only reinvent itself because it took a very attentive look at customer data and responded accordingly.

Align your digital initiatives with the power of a Customer Data Platform

While IT staff has been skeptical for a while, digital leaders worldwide have been engrossing CDP in their workflows and getting amazing results from data management automation.

Not only has perfect treating data been helping these leaders come up with customer-centric solutions, but it has optimized their budget and turned manual work more effective.

Forbes Insights highlighted that 44% of surveyed organizations stated a Customer Data Platform is helping drive customer loyalty and increase ROI.

Arena serves customers from 120 different countries and sees firsthand how the fast-paced digital environment influences global market changes day after day.

That is why we work to build awareness for digital leaders and marketers to embrace Customer Data Platforms in their full potential and boost customer engagement.

In case you need to further your research towards the CDP role for the upcoming years, download our Customer Data Platform 2020: the future of marketing and sales ebook and take a deeper dive.

Customer Centric: what is it, benefits, and how to apply this strategy

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A customer-centric approach is nothing new in businesses, but it is transforming the way companies work nowadays. It’s time to understand more about it.

Being customer-centric is not a new conception in the market. However, with the changes in customer behavior these days, it’s a strategy that is becoming more popular. It’s not only about focusing on the customers, but it’s also about making them the core of your business.

Some time ago, industries used to lead product-centered strategies, meaning that if a product wasn’t selling well, it needed to be renewed and improved. However, as time went by, marketing professionals started to notice the problem was not in the product, but in who was buying it. If you don’t have the right consumer, there’s no point in having the highest quality solution in the market.

Because of that, customer-centric is becoming more and more popular. As a matter of fact, this is far from being a brand-new concept. Companies have known it for ages, but it seems like the notion of it really started to gain attention in recent years.

Since customers now are more educated and informed, their expectations are getting higher by the day. If the company doesn’t find a way to live up to that, it will most likely not survive in the market. To genuinely build the right product and invest in the right marketing campaigns, following a customer-centric strategy is ideal.

What is customer-centric?

Also knowns as client-centric or customer-centricity, this is an approach that aims to put the customer in the center of everything. All strategies and actions the company makes are addressed to the customer. So, if an idea doesn’t fulfill the “will our customer want and like this?” aspect, it probably will be left aside.

Clients are the purpose of a company even starting to work and for that reason, they need to be satisfied with their acquisitions. That means paying attention to the consumer before, during, and after a sale happens — therefore, being directed related to customer experience. The goal is to provide the most positive experience possible.

For a business to have good results, being customer-centric shouldn’t be just a strategy. It should be the core of everything it’s done, creating a customer-centric culture inside the company. That way, every product, service, and publicity will happen around the consumer’s needs and pain points. Because of that, one of the most important things here is to know your consumer.

It’s more than creating a good product, it’s about developing something that’s so good and fit to the client that they don’t want to buy from anywhere else. This approach is to increase customer loyalty and retention rates.

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What are the benefits of customer-centric?

Aside from knowing the consumer and creating all the picture-perfect products and ads for them, there is much more we can talk about a customer-centric approach. All the benefits it brings to a business are surely in your interest, so this is what we’ll address next. 

Increase the customer lifetime value

In recent days, new customers are more expensive than retaining the ones you already have. For that reason, when you work with a customer-centric method, you will eventually increase the customer lifetime value.

In other words, a strategy such as putting the customer at the core of the business will, consequently, give the clients more reasons to be loyal to the brand. That’s what the company needs to focus on: strategies to make current customers buy more and frequently.

Moreover, this will lead to an increase in retention rates and also in overall profits. In fact, a mere 5% increase in customer retention leads to at least a 25% increase in profits — but it can be up to 95%.

Anticipate customers needs

Every area in the market has its competition and it’s important to be known as the innovator. When a customer is at the center of strategies, the problems they have will be explored so the company knows what to look at when building their solutions. With a thorough data collection in real-time, it’s possible to anticipate customer behavior and offer accurate, original products.

Gain a competitive edge

With loyal customers and a real-time data collection strategy, your company will become a strong competitor. Every business will be looking at you as an example of what to do and how to achieve success.

With so much alike solutions and prices, positive customer experience will be the differential of the brand. It’s actually common to see people pay more on services because they offer a unique experience — rather than because of quality.

How to become customer-centric

Well, surely, put the customer at the center of the strategy is the first thing that comes to mind. But it’s about much more than that. To truly enjoy all the advantages of this strategy, there is a need to work with empathy. This means, basically, what we’ve been saying so far: 

First look at the customer, then work on the product.

Since the rise of the internet, customer behavior has been in constant innovation. Every year companies need to renew their strategies so they can keep up with the changes. The good thing is technology has found its way to be one step ahead by creating data-collection platforms that help understand who is the consumer and how they act online.

Overall, some characteristics of a customer-centric business are:

  • use customer data to understand the customer base;
  • analyze who are the best customers and focus on products for them;
  • give special attention to customer success and experience;
  • practice audience engagement;
  • identity opportunities and make data-driven actions.

By using a Customer Data Platform, all information available about a brand’s consumers will be at easy access. From names, ages, and demographic to time spent online, and pages visited. The CDP can collect data from all channels and sources the company is connected with, such as website, online store, social media, payment systems, app, and so on. That’s why a customer-centric approach should be accompanied by a CDP solution.

The more you know about a customer, the better the chances are of having a successful customer-centric strategy. As a matter of fact, to implement this method in your company, it needs to go beyond marketing and sales teams. The entire firm should follow a customer-centric culture. This means customer support, product team, engineers, and whatever other sectors the company has will all be focused on learning and working around the customer.

In addition, it’s important to remember results don’t come overnight. This plan is a long-term project of building durable relationships and providing positive experiences over and over again. After all, customer acquisition costs are way higher than maintaining a devoted customer base. In order for that to happen, the brand needs to be in regular communication with the customer, whether over chats, email, or social media.

Customer-centric marketing

It’s was pretty much implicit that this approach could be used to marketing-related actions. For one, you can’t build a customer relationship without the help of the marketing sector. Indeed, performing an Inbound Marketing plan and delivering content is essential to establish bonds with an audience.

With the assistance of a Customer Data Platform, while being a customer-centric company, every moment of the customer experience can be thought of with minimum effort. Surely, it’s still something that requires the full attention of marketing professionals. However, they can focus more on planning strategies and content than on analyzing data and metrics.

The entire customer journey has to be worked in a marketing strategy. This means personalized content and ads will be sent at every stage of the journey. Even after a purchase is finished, marketing needs to be creating the right materials to send the customer. It’s the only way they’ll become loyal to the brand, maybe even turning into brand advocates and promoters. 

Moreover, based on purchase history and engagement with the brand, personalized recommendations will have a great effect in strengthening the relationship. The essential is focusing on what the customer wants — something you’ll be able to do through data analysis.

How a customer-centric approach impacts sales

In the old days, a sales process was demanding for the salesperson. They had to know every little detail about the product or service and have the ability to negotiate to close as many deals as possible. Nowadays, with the customer-centric strategy, things have taken a turn.

Since the customer is the focal point, a sales rep is no longer the person who showcases the product and tries to sell it at any cost. In fact, they understand the customer pain points, wishes, and demands so they can perform as a consultant — demonstrating how certain products will help solve their issues.

Because of this, it’s just as important for a sales team to have access to CDP data as a marketing team. Customer data is crucial to understand their journey and what is the best way to act in each particular moment. Even though a customer-centric strategy doesn’t attract many new consumers, it does keep the existing client base more loyal. For this reason, identifying the most valuable customers, the ones that generate profits, is a way to assist sales professionals chose their target better.

Customer-centric and customer experience

You must have noticed that customer experience has been mentioned a few times throughout your reading. That’s because there is a relationship between customer-centric and customer experience. But what is it?

In general, customer experience is the relationship a client has with the brand. From their perception at the first contact to their satisfaction after buying a product, every step of the way is a potential influence on their experience. Therefore, a customer-centric company needs to bring a positive customer experience at every moment of the customer journey

Brands that apply Customer-Centric 

For a better comprehension of how a customer-centric company performs (and their results), a few examples can be brought here. These three companies are stand-outs in working with their customers at the center of everything. However, there are many more to keep an eye on for inspiration, such as Nike — their empathy really shows in every marketing campaign they launch.

Amazon

If you have the habit of doing online shopping, you probably already got something from Amazon. Do you remember how was the experience? This is a brand that nobody can question the customer is at the center of their attention. Everything they do is to improve the customer experience.

Details like the 1-click purchase using data previously saved make a difference in obtaining customer loyalty. Besides, people are always talking about their delivery service — they are fast and accurate with their deadlines. Thus, customer satisfaction is never a problem in their hands.

Disney

Disney is a brand that embraces lots of different products and services, such as animated movies, TV channels, and amusement parks. Nonetheless, it’s noticeable how all of their actions are directed to their clients. They work hard to keep their customer-centric culture remarkable. This means customer-centric works beyond digital strategies.

The thing is, people can see the value in the brand. They happily pay more to go to Disney’s park then they would to go to any other park. 

Slack 

Even though this isn’t such a recognized brand as the other two, it’s still worth mentioning their method of work. Slack is a cloud-based communication company that is rapidly growing. Their approach is totally concentrated on the customer experience. 

Instead of having a group of professionals that knows every single detail of the product, they focus on certain areas of expertise. That way, when a customer contacts the team with a question, they are redirected to an expert in the area.

Plus, customer service and product development work in union to always update the service as they notice customers’ needs. Slack is a brand known to be open to feedback from their clients, so more than gathering data, they are regularly monitoring brand mentions so they can meet customers’ expectations.

How to measure the success of a Customer-Centric strategy 

So, you’ve established a customer-centric approach in your company and got everyone working towards it. How do you know if you’re having the desired results? There are three metrics that will give you the answer: churn rate, net promoter score, and customer lifetime value.

Churn rate

First of all, the churn rate. This metric is related to the number of customers who no longer interact and buy your products. To measure it, it’s necessary to divide the number of customers who left in a certain time period (1 month, 6 months, 12 months, and so on) by the average number of costumers in the same time period. If you lost 10 customers out of 100, for example, your churn rate will be 10%.

Since you want your customers to keep engaged and buying from you, in order to have a successful customer-centric approach, your churn rate needs to be the lowest possible.

Net promoter score (NPS)

The NPS, or net promoter score, is about measuring customer loyalty. There is one simple question that revolves around this metric: “how likely are you to recommend us to friends?”. And, in a 0 to 10 scale, people can be classified as detractors, passives, or promoters. 

  • Detractors: From 0 up to 6, they are the first kind, the detractors. It means they are not happy with the product or service and are likely to share negative experiences. 
  • Passives: Between 7 and 8, customers are happy, but not loyal. 
  • Promoters: Lastly, when the classification is 9 and 10, people are most likely brand promoters. This means they are not only satisfied with the brand, but also share positive experiences about it.

Once these data become available, the calculus should be the percentage of promoters minus the percentage of detractors. The results need to be higher than 70%, but ideally, for a customer-centric company, they need to be around 80% to 100%.

Customer lifetime value (CLV)

The customer-centric strategy is based on creating a long-term healthy relationship with the customers. So, measuring the customer lifetime value, or CLV, is a way to see if your plans are having positive outcomes.

The calculus is multiplying total revenue by the time of the relationship with the customer (total revenue X average customer lifetime). 

CLV measures the revenue a customer generates to the company for as long as they are paying customers. This is the best metric to understand before and after results when applying the customer-centric approach to your business.

Here at Arena, we have the best CDP solution for your business. With our real-time data collection, you’ll be able to know exactly who is your consumer and how to work thinking about them. Learn more about our solutions by talking to a consultant.

Understanding the Difference Between Customer Data Platform (CDP) and Customer Relationship Management

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Customer Data Platforms are still new in the market and they can be mistaken by other solutions that came before them. Here’s the difference between CDP and CRM.

The difference between CDP and CRM needs to be explained. Even though they both gather customer data, they work in distinct ways. While the CDP is a much more complete software, the CRM can still perform very well in many strategies.

Customer Relationship Management (CRM) and the Customer Data Platform (CDP) are both customer data-collection-related software. However, there are many differences between these two systems — from the type of data gathered to why they are used. For example, CRM was developed to assist sales representatives while CDP is much more focused on marketing teams.

Because CRM can be integrated into the CDP, that’s even one more reason they can be mistaken for one another. Nonetheless, the difference between CDP and CRM is there and it needs to be understood. Mainly for the reason of knowing what is the best solution for your company.

So, if you already know what your pain points are, you only need to understand what is a CDP, what is a CRM, and the difference between CDP and CRM — which is everything we’ll explain ahead.

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What is a Customer Data Platform (CDP)?

A Customer Data Platform, commonly known as CDP, it’s a software that gathers, processes, and stores data. It’s a system that was created with the goal of helping marketing teams to be more successful in their strategies. Through a database created by the CDP, marketing professionals can have access to all information about a company’s clients and prospects.

These data can include characteristics such as:

  • name and age;
  • contact;
  • demographic;
  • time online;
  • pages visited;
  • products of interest;
  • which social media they use;
  • how many interactions they made with the company;
  • purchase history.

This is just a general overview of what a CDP can do since there is still a lot more information it can collect. Even more, it’s a thorough platform as it unifies data from several sources, both online and offline. This way, if someone follows the company’s Instagram and then buys a product in a physical store, the software has the ability to recognize it’s the same person, organizing all data about him or her and avoiding data duplication.

Basically, the CDP consumes data from any available source to create its database. Some examples we can name consist of the company’s website, online store, social media, payment systems, and app.

Moreover, a CDP system will always be up-to-date since it works with real-time data collection. This means information begins to be processed and stored from the first contact with the brand. Even if the person doesn’t share personal information on the first visit, their online behavior is being analyzed.

That way, when they do decide to share personal and/or contact data, the system will be updated and unify all that information into a singular customer profile.

Something that’s worth mentioning too is that the data available on a CDP software has no lifetime limit like cookies do. A system like DMP, for instance, has up to 90 days of data storage because it only works with purchased cookies — you’ll understand more about this later on.

Also, a CDP will create unified customer profiles for clients with similar preferences and habits. These can be analyzed and used to create segmentation groups for highly personalized customer journeys. Of course, individual profiles can be used for the same reason.

Working with real and reliable data makes a huge difference in marketing strategy success. Still, other teams inside the company can also benefit from using a Customer Data Platform. For example, sales and product teams can have access to all the data without the need to have reunions and updates from the marketing sector.

Just like that, the whole company is able to work with efficiency to give the customer the best UX possible.

Customer Relationship Management (CRM): Definition and Advantages

Customer Relationship Management is a system developed to assist mainly sales teams. Yet, nowadays, it’s used by other sectors in a firm, like Human Resources and the supply chain.

Overall, what CRM does is gather customer data through online transactions. So, what makes it different from the CDP? Well, that is the fact it only analyzes personal data from known customers. That means it’s possible to check information like name, age, and contact, but not the number of visits made to the website or which pages were visited by each client.

The main role of Customer Relationship Management software includes:

Even more, it’s a platform that’s used in the B2B (business to business) field, where data allows us to analyze the sales pipeline and see where there are more chances to close a deal.

It’s a guaranteed way to understand more about the consumer and the context where they are before contacting them — which will help increase conversion rates. After all, when you know who you are talking to, customer service is more accurate and the client will have a more pleasant experience.

In spite of the difference between CDP and CRM, both systems perform their job in a way that is noticeable. Customer Relationship Management helps increase profitability and simplify sales processes. Likewise, since CRM is a source to feed the CDP as well, it makes marketing processes easier — this technology allows to make accurate decisions based on real data.

What is a Data Management Platform (DMP)?

It’s important to mention the Data Management Platform (DMP) because it is also a system commonly mistaken for CDP and CRM. In fact, there are similarities, but they are all different software and perform different functions.

In this case, DMP is a program that works with data collection and organization, but there is a big difference from the others: its database is formed by anonymous cookies.

These cookies are purchased data from external providers. That’s why they are anonymous — brands can’t collect and sell personal data. Because the customer decided to share their personal information with a brand, that doesn’t mean the brand can share it with any other company.

Even if they’re anonymous, these data are still a valuable resource to create target audiences and make promotions at large scale. Therefore, marketing teams are the ones who mainly use this platform. Besides, it provides professionals of the area enough support so they can create new segmentation groups to use in ads and overall campaigns. This way, boosts brand awareness and grows the company’s audience.

Also, one last detail to keep in mind about a DMP system: all data gathered can be processed and added to the Customer Data Platform.

What’s the Difference Between a Database and a CRM?

Based on everything that’s been said so far, it’s noticeable some differences between CDP and CRM. Then again, it’s important to show clearly what they are and clarify them a little better.

Application

First of all, Customer Relationship Management seeks to personalize and improve customer relationships. While CDP also has that at its core, it also focuses on how to ameliorate products and services. Thus, bringing a better overall customer experience.

Another factor to take into account is that CRM mainly analyzes sales pipelines looking to transform leads into customers. Though a Customer Data Platform does that as well, its priority is more about getting to know the consumer. Only then, the system do a public segmentation and help in creating personalized campaigns and publicity.

How Data is Collected

While CRM only gathers data of active consumers, CDP includes unknown prospect data too — so that when they decide to share their personal information with the company, the system will recognize who they are and put together all the information. Even more, a difference between CDP and CRM is the amount and type of data that can be collected by each platform.

At the rate Customer Relationship Management stores personal data, such as names, age, address, etc., the CDP knows a lot more — like the time each consumer spent on each page they accessed. Additionally, everything that is related to the brand is a source to increase the CDP’s database, from the company’s website to the payment systems used by the firm.

Customer Journey Tracking

If a client clicks an ad but decides to purchase in another moment, through another source, CRM doesn’t have the capability to connect that it was the same person who took those actions. However, that tracking becomes possible with the CDP.

As previously mentioned, Customer Relationship Management doesn’t gather offline data. So, if a customer interacts with the brand online, but buys on-site, the system can’t connect the dots. CDP, however, has the knowledge to understand and put together that information, following the entire journey someone makes to conclude a purchase.

Data Duplication

For the same reason CRM doesn’t track customer journeys, it ends up with data duplication. Since the system doesn’t have the intelligence to understand the person who clicked an ad and bought on-site as the same one, data ends up being repeated as if it were two separate persons. The same way, this happens if the customer interacts with an email and then on the website, among other cases.

Nonetheless, the CDP configuration enables data processing to avoid duplication. So, even if a customer identifies as Mary Jane Brown in one source and MJ Brown in another, that data will go into a singular customer profile.

IT Support

Even though CDP is a much more complex system than the CRM, it’s this second software that needs more IT support. From configuration to management, the Customer Relationship Management system needs the tech team through the entire process. Meanwhile, the CDP will probably need some support at the first configuration, but, after that, anyone with authorization can easily access the database.

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CDP Benefits for Marketing Professionals

Many benefits can be implied along with the explanation about what is CDP. For instance, how easy it becomes to know your consumer and create the finest content possible. As a matter of fact, that is the main goal of acquiring a CDP solution.

As a part of the advantages, we can name:

  • understanding who is the customer;
  • knowing the pain points of the consumer;
  • getting a complete database;
  • increasing conversion rates;
  • improving ROI;
  • automation of data analysis;
  • lower operational costs.

Currently, the purpose of a company lies much more in understanding who is their consumer than on working on products. Getting the ideal customer is even more important since that will reduce the need to constantly work on the product. Still, developing and perfecting a product or service occupies a high position on the priority list.

When we talk about pains and gains in marketing, the idea is that all clients have different pains that the company will have a solution for. This way, a CDP gives all the necessary data for marketing professionals to find out what is impacting the audience and in what way their product can be used to put an end to the problem.

From the information about the consumer, the team will be able to create exclusive content and advertising that are extremely directed to increase the chances of landing a conversion. To clarify, data about what a person likes and dislikes, where he or she lives, who they live with, where they seek information, what kind of content they pay attention to, amongst many other possibilities. The more you are able to discover, the better the result will be.

Overall, marketing by itself is already a way to increase conversion rates and return on investment. Still, a Customer Data Platform will intensify that factor by giving the most accurate and real data as you can get.

In addition, it won’t be necessary to have a specific professional or group to analyze data into what’s useful or not. By using a CDP solution, that will already be covered — therefore, reducing operational costs and making the process automatized and faster.

How to Strategically Use CDP and CRM

Even when we consider the difference between CDP and CRM, a company can still take advantage of the benefits of both software. Everything that’s processed and stored in the CRM and in the CDP has an important role in two moments.

First, to help small businesses grow. Then, to help companies that already have an established audience and are looking for a large-scale solution to work on digital marketing strategies.

Through marketing strategies, it becomes possible to recognize an issue and present a solution. And with a CRM and CDP database, marketing professionals can identify exactly who the target audience is.

With all the data available, from purchase history to offline habits, the company controls target audience segmentation, creates an automation flow for emails and ads, and analyzes performance metrics. Thus, directing content with precision.

After analyzing the difference between CDP and CRM, have you decided on acquiring a solution like this to your company? Arena will give you the best product to work with data collection, customer experience, and audience engagement.

Plus, our team is always available to answer all of your questions. So, stop delaying the success of your business and talk to one of our consultants right away!

What is and how to do Customer Data Management CDM

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This guide will teach you how to use data frameworks to offer differentiated customer experiences and optimize marketing ROI.

It has been a few years since the buzz around “Big Data” started. Working with marketing in the media space, you probably hear your peers bragging about their data-driven strategies a lot. Do you consider yourself a data-driven marketer too?

Beyond marketing, modern CMOs have had to assimilate abilities in information technology and customer data management.  In 2020, you should expect most marketing teams to effectively use customer data to drive growth and customer satisfaction.

Getting there can be quite a journey, though. Research from the Dentsu Aegis Network from 2018, made with 1,000 CMOs, shows that to two-thirds agree that while there is increasingly more consumer data available, it’s harder to extract insight from it. 

Another report from Harvard Business Review shows that less than half of an organization’s structured data is actively used in making decisions, while less than 1% of its unstructured data is analyzed or used at all. 

Historically, companies have relied on excel sheets and on manually storing and analyzing customer data through different software, with little to no integration. No offense to excel and isolated systems, but things have changed.

The amount of customer data flowing to companies’ databases continues to rise through new channels and platforms, and that’s where customer data management comes to play. More than ever, organizations need a complete set of practices and automation tools to help them manage customer information.

In this article, we will talk about the importance of having customer data management on top of the marketing agenda. We’ll also explore the types of data, best practices for data management, and the role of different data software in data management.

What is customer data management?

Customer Data Management, shortly known as CDM, is the framework in which companies collect, track, organize, analyze and share customer data throughout the organization. 

The term “Customer Data Management” was coined in the 1990s, initially as a way to describe software that replaced disc-based or paper-based data storage. Such software was often used independently by departments within companies.

The concept of CDM evolved along with the Software as a Service (SaaS) industry and nowadays embraces a wide array of cloud computing applications that centralize access to customer data. It also embraces a set of methodologies that help marketers to locate, cross-analyze, and act on customer data.

Why marketers should invest in customer data management?

In a scenario where customers interact with brands through dozens of channels, there is almost no room for guessing and gut-feeling in marketing. Having a good hunch about what will engage audiences is not enough, and so the role of customer data management is to provide companies with accurate and actionable insights.

It reduces your chances of making mistakes, since mismanaging your customer data can lead to actions that will ultimately reduce engagement and profitability. Additionally, using customers’ data in a biased, inaccurate way can lead to poor customer experience (CX) and harm your brand. 

Good customer data management is key to building a data-driven culture and bolstering customer-centricity in marketing. Isn’t it everything you wish for? 

Data Management strategies can bring marketers a holistic view of customers’ journeys, connecting the dots between different channels, and offering cues to enhance their experience.

Customer Data Management is important for: 

  • Customer acquisition
  • Increasing retention and engagement rates
  • Knowing customers in detail and in real-time, from individuals to clusters
  • Increasing data quality by breaking data silos
  • Simplifying customer relationship management (CRM) 
  • Drive higher revenue

How customer data management is connected to customer lifetime value (CLV)

Having well-structured customer data management practices is what allows marketing teams to follow up on important indicators, like the Customer Lifetime Value (CLV).

Amidst a seemingly chaotic user journey – with different channels, devices, and purposes – customer data management can help marketers understand customers and guide them through the conversion funnel. 

Collecting and organizing relevant customer data will allow you to better segment your audience, find out behavior and buying trends, and drive personalized campaigns. As a result, marketers can ultimately attract more qualified leads and reduce customer acquisition costs (CAC) – improving overall marketing ROI.

But customer data management is useful only for marketing. It can help sales, IT, and customer success manages customer touchpoints. The great news is that every department can have access to the same data and deliver a consistent, unfragmented user experience.

Four Types of Data to pay attention to

Before trying to set up a data management framework, your team should have a roadmap of data types and specific information that can enrich your strategy, according to your business goals. 

We will now explore four data types and a few examples for each.

1) Identity Data

Identity data is collected through micro-transactions and interactions in the company’s channels – when a customer signs up for a newsletter or enters their payment information on the checkout page.

By collecting customers’ identity data, marketers have the minimum amount of information to start a conversation (and hopefully a long relationship) with the customer. Such information is also helpful to help companies build brand personas. 

Examples of identity data: Name; Personal data (date of birth, region, gender, etc); Address; Contacts; Social media profiles; Account data.

2) Quantitative Data

Quantitative data is mostly related to the customer’s decision making process as they interact with your brand. Such data covers different channels throughout the customer lifecycle, from emails and customer support channels to purchase transactions and social media. 

The idea is to understand the specifics of how customers are interacting with your brand through important operational data. You could use quantitative data to find out details about channel interactions and steps that led customers to convert.

Examples of quantitative data: Transactional data, such as the number of purchases, time of purchase and subscription value; Order dates; Cart abandonment and Bounce info; Click-through-Rates; Website visits; Product views; Number of Interactions.

3) Descriptive Data 

Descriptive data comprehend additional lifestyle information that complements customer personas. Collecting this type of data typically requires doing deeper research and interviews with customers in order to dive into individual buying behavior. Such data is pretty helpful if you want to use predictive analytics in your marketing strategy.

Examples of descriptive data: Family Data such as marital status and number of children; Lifestyle data, like hobbies and interests; Education and career data.

4) Qualitative Data 

Qualitative data should describe the motivations behind the customer’s actions. Gathering such insights might be more time-consuming and expensive than simply collecting quantitative data, but it is worth it. After all, tackling into customers’ deepest motivations is how you’ll captivate them.

This type of data is better collected on a one-to-one basis, mainly through the marketing teams’ interpretations of customers’ opinions throughout their journey – through analyzing CRM notes or reviews in websites, social listening tools, feedback questions, and Net Promoter Score (NPS) systems. 

Best practices in customer data management

An effective customer data management framework requires marketers to make human and tech investments, have well-defined processes and priorities. We have picked a few key practices involved CDM:

Data collection 

A lot of the data within enterprises go unused, and so data collection is the first step in building an integrated customer data management strategy. There are millions of data streams coming into companies’ systems from many touchpoints, and so marketers need to make sure relevant data doesn’t go to waste. 

It’s important to understand what data needs to be ingested. Ask yourself: What goals do I want to achieve with my marketing strategy? Which data points are directly or indirectly related to my Key Performance Indicators (KPIs)? From there, you can start filtering your sources of data and the indicators you will track.

Data Integration

Centralizing all company’s data into a central system is also vital for customer data management. That enables the “ETL Process”, which stands for “Extracting, Transforming and Loading” data. This stage is where you will check your data integrity, filter it, and validate it. 

A good data system will ingest relevant data, convert it in necessary formats and load it into different tools such as a data warehouse, a customer data platform (CDP), a data management platform (DMP), a customer relationship management (CRM) or any other system. The result? You will have a single hub for all the data you need.

Data management

This is where you connect the dots between data points to build robust, unified profiles of individual customers or segments. This could mean using statistic models to create identity graphs, applying data governance to make sure you integrate consent to customer data, or anonymizing data to be used through a data management platform (DMP).

Data analysis and activation

Data management tools: the difference between CRM, DMP, and CDP

Although customer Data Management can be described as a framework, it requires companies to have the right technologies. 

Your data software stack could be more or less complex depending on the size of your business and the number of touchpoints with the customer, but, essentially, your CDM strategy will require a combination these platforms: a Customer Relationship Platform (CRM), Data management Platform (DMP) and Customer Data Platform (CDP). 

Each one of them plays a role in your strategy. But what is the difference between them? 

The basis of data management starts with customer relationship management systems (CRM), which are built to engage with customers by tracking their relationship with your company. They only store data if the customer has interacted with the brand in some way, and they are based on historical and general information such as contact, demographics, and notes made by CRM teams.

Data management platforms (DMPs), on the other hand, have been widely used by marketers to serve ads and lead digital campaigns. These platforms focus on third-party anonymized data collected through cookies (that typically expire after 90 days), device IDs, and IP addresses.

In a different model, a Customer Data Platform (CDP) is a software capable of unifying customer data from various sources, internal or external, gathering quantitative and qualitative information from multiple touchpoints between a company and its customer base. It allows you to build a holistic view of customers and their pain points in a granular way. 

Why CDPs are the ultimate trend in customer data management

Although CRM systems, DMPs and CDPs share similarities, they are different when it comes to managing data. Customer data platforms, specifically, have increasingly been used as an integration hub for data systems because they are built to ingest large volumes of data from multiple sources – unlike CRM systems and DMPs.

There were days when marketing segmentation based on DMP persona segments and CRM was enough, but today, brands are expected to personalize every step in the customer journey – which is only possible through CDPs.

A study by Forbes shows that 53% of marketing executives are using CDPs to engage with existing customer’s needs, increasing the likelihood that they will become recurring clients.

The focus of CMOs is also shifting from third-party data and anonymous data to first-party, single customer data, which also underlines CDPs’ importance. As data privacy and compliance regulations arise, organizations also seek to work with their own, integrated data.

CDPs are capable of providing marketers with a historical record of identified customers that can be used not only for advertising but for other purposes as well.  By centralizing information in a single platform, companies can optimize resources and avoid having to rework their data over and over through different systems. 

Bonus tips for successful data management

Make data widely available to different teams: The Harvard Business Review study we mentioned before reveals that 80% of a data analyst’s time is spent on just discovering and preparing data. Customer data can be an important asset across departments, so it’s important to centralize access to it instead of storing it in separate departments and warehouses. Let the data flow!

Always keep data governance in mind: Understand the privacy policies of your data tools and ensure consent is integrated into all of your data collection, while also respected in marketing campaigns. 

Don’t over-collect data: Understand exactly why you’re collecting the data your collecting, and which questions your company is trying to answer with them. Resist the impulse to gather too much data “just in case” you need it, without a proper purpose.

Create rules for data categorization: Set up file formats you’ll be using, standards for tags, file-naming, and timestamps. Such standards will make it easier for your team to navigate through the data.

Beware of new data sources: Pay attention to emerging data types, such as those from voice activation devices, geo-localization in smart devices, Internet of Things, Augmented and virtual reality platforms, etc. New data points will eventually require new processing and marketing frameworks.

Still want help defining your customer data management strategy?

Now that you have learned a bit more about customer data management, maybe your next step will be to study data management solutions.

If that is the case, we recommend you check out Arena’s customer data platform blog section to dive deeper into the subject. You can also get in touch with one of Arena’s consultants and learn the specifics about our CDP.