CDP use cases: basics and beyond

Before we dive into data activation use cases, however, we need to discuss two foundational use cases: data unification (aka data assembly) and data governance and compliance.

Customer data is typically scattered across multiple databases, marketing channels, and tools. A customer data platform brings all that data together and creates a complete profile of your customers and prospects, including:

• Their preferred marketing channels
• The pages they viewed on your website
• Their purchase history
• …

A CDP functions as a digital memory bank for your business: a single source of truth. In this way, it also resolves the all-too-common issue of data silos, where subsets of data are available to one company department, but not others. This situation is detrimental to collaboration, productivity and even data quality, since every team is working with its own version of the truth. Moreover, unified customer profiles created by a CDP – a process that’s also referred to as ‘identity resolution’ – form a solid base for various marketing use cases.

Here at MultiMinds, we’re big advocates of a privacy-first approach to collecting customer data. So before you consider any activation use cases, you need to make sure you’ve got user consent properly covered. A CDP is great for this since it controls data flows between different marketing systems and makes them more transparent. This allows you to set up proper consent management and makes it a lot easier to comply with GDPR and data privacy regulations, e.g., the right of your users to consult, receive and delete the data you’ve collected on them.

Once you’ve received permission to collect first-party user data and have unified and structured it into profiles, you can take action on it. So what are some of the main possibilities?

When CDP use cases are mentioned, personalisation is often the first thing that comes to mind. And with good reason: according to McKinsey, personalisation can increase revenue by 5 to 15% and improve marketing spend efficiency by 10 to 20%. It’s more effective in moving users toward engagement and conversion and can significantly boost customer loyalty.

How does it work? Personalisation can take on many forms. The data collected by your CDP tells you how identified users navigate your website, app, store, or any other touchpoint, and which actions they have taken. For example: which pages have they visited the most? It can also include data from your CRM, like their personal information, the type of relationship they have with your company, or the industries they are active in.

These insights allow you to push personalised communications: email messages, custom videos, recommended products, content recommendations, etc. With modern tools, it’s even possible to personalise the in-line copy on a webpage.

The data from your CDP can also be used to group customers with certain characteristics into segments. For example, a retailer could create a segment with clients who are sensitive to specific kinds of promotions.

Some more advanced approaches to segmentation could be to identify:

• high-value audiences and target them with exclusive promotions
• your most price-sensitive customers and hit them with discounts
• users who have abandoned their shopping carts and send them reminders about their viewed products
• customers with a high probability to subscribe 

The above examples are all about tailoring content, offers or recommendations for specific audience segments. But audience segmentation can also be helpful to exclude certain groups of customers from messaging or promotions. For example, you don’t want to hit your loyal customers with a promotion that’s exclusive to new subscribers. Or target a social campaign for a product at people who recently purchased that exact product. This process of excluding specific audience segments is called ‘audience suppression’.

What if you knew which of your customers are close to unsubscribing from your service? With a CDP, you can. By pulling data like declining interactions, lower email open rates, a decrease in product use, or lower social media engagements, it can detect a weakening bond between specific customers and your business.

Knowing this puts you one step ahead and allows you to send a personalised message or improve their experience. For example, you could send them an email explaining the features of your product, a limited promo code, or give them more time to try your product.

Boost your revenue by spotting sales opportunities for complementary products, or by persuading existing customers to buy higher-tier offerings. Customer data insights about past purchases, timing, loyalty and communication preferences allow you to hone in on what they may need next.

For example, you can identify which of your current customers have been browsing other product pages or have been consuming more of your content on product use cases or features. A personalised promo code or dedicated content campaign about using some of your products together could do wonders here.

CDPs are useful for more than marketing. They’re also pretty nifty tools for improving customer service. A worthwhile endeavour, if you consider that 66% of B2B customers stop buying after a bad experience with the support team.

Imagine, however, if your service or support people had instant access to insights about how a specific user has engaged with your company: their purchases, earlier questions or complaints, preferences, … This would make service conversations a lot more efficient and has the potential to boost long-term customer loyalty. There would be no need to ask a thousand questions, dig for information or – god forbid – put a customer on hold to find relevant data.

As you’ve probably guessed by now, the main purpose of a CDP is to improve the customer experience in every way possible. The tool allows you to quickly decide which customers to target with what content. Most CDPs also allow you to measure and track the impact of campaigns, making it possible to endlessly refine and improve your channels and assets.