Customer Data Platform
Glossary of terms

What Is a CDP?

A CDP, or customer data platform, is software that unites customer data into a single unified profile for each customer. CDPs can either be cloud software or on-premises, but many CDPs today are cloud-enabled. Using AI and machine learning, the best CDPs identify customer data from a wide variety of sources, including loyalty programs, mobile apps, CRM data, order history, transaction history, social media and browsing histories, customer service contacts, digital marketing impressions, and clicks. The CDP then uses that data to construct accurate customer profiles of each customer. The largest-scale CDPs unify millions and potentially billions of profiles, constantly updating each profile as customers browse, shop, use social media and mobile apps, or wander past IoT sensors. The resulting unified profiles are then accessible to various stakeholders and systems throughout an organization. However, marketing and strategic decision makers are usually the heaviest CDP users.

CDPs are a marketing technology that intersects with data analytics and other data-driven technologies. As a result, they are most often used by marketing professionals as a means of unifying disparate sources of valuable customer data, for new insights about changes in a market, targeting and segmentation, new customer acquisition. The data and analytics, in turn, help marketers run campaigns that are more personalized and targeted, as well as helping customer experience managers run more successful, personalized customer experience programs.

Why CDPs?

The digital age is a double-edged sword: Marketers have more data than ever about customers and prospects, but that data is often siloed in different marketing platforms and/or is not linked together into one unified profile. CDPs play a valuable role by associating customer data from massive pools of data into unified, accurate customer profiles. These streamlined profiles can then serve as the basis for new and ongoing marketing programs, ad campaigns, new customer acquisition, targeting and segmentation, mobile marketing, and other marketing applications and marketing ROI improvement programs. Some CDPs have special orchestration features that can mobilize other martech and adtech using the CDP’s unified profiles as their input. CDPs help companies to enhance their overall customer experience by helping marketers provide targeted, personalized CX for different marketing segments and individuals alike.

Glossary of terms

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