Why the Customer Data Platform is one of today’s top technology acquisitions

Monday, 03 May 2021 10:11

Why the Customer Data Platform is one of today’s top technology acquisitions

Katrina Wong, Vice President Product Marketing & Demand Generation, Segment

GUEST OPINION by Katrina Wong, Segment: Consumers’ collective flight to digital sparked a global CDP boom in 2020 and, as the economy recovers, Australian businesses that don’t implement the technology may struggle, writes Katrina Wong, Vice President Product Marketing & Demand Generation, Segment.

Was slashing outgoings across the board your organisation’s initial response to the COVID crisis in early 2020? Around Australia, business leaders in their thousands went scrambling for savings to bolster their bottom lines, as the country experienced its first recession in more than 30 years.

Information and Communication Technology (ICT) projects were common casualties of the great corporate cutback, with organisations typically canning or postponing all but the most pressing of initiatives, until the full impact of the pandemic became apparent.

Against this backdrop of caution, however, sales of Customer Data Platforms continued to grow at a very healthy clip.

Last year saw businesses deploying more and spending more on CDPs, according to the Twilio Segment CDP Report 2021. Almost 50 per cent of respondents to the annual survey stated they would increase their CDP investment by more than 25 per cent in the next five years.

The big spending plans weren’t confined to the big end of town – 44 per cent of small businesses and 49 per cent of mid-market respondents listed themselves in this category, alongside 54 per cent of enterprise and large enterprise customers.

Customer experience is king

What’s driving the CDP push at a time when businesses are otherwise keeping a tight hold on the purse strings? The answer is simple: customer experience. For many businesses, it has become the chief factor that differentiates their product offering from the competition’s. Consequently, ensuring customers’ needs and expectations are consistently met and exceeded is now an overarching imperative, for businesses large and small.

And in times of uncertainty, its importance increases.

"Customers demand more than just a seamless digital experience, they seek continuity of experience…organisations that have been agile, adaptive and focused on delivering a

consistent and personalised customer experience across channels are among the top performers in Australia," KPMG’s Customer Experience Excellence Report 2020 notes.

Last year’s local customer experience leaders – First Choice Liquor, Ikea and Afterpay, according to the report – were cognisant of this fact. They harnessed digital technology to

deliver competitive pricing, seamless purchasing and delivery arrangements and reliable and helpful customer service and saw their sales soar as a result.

Joining the data dots

In the hyper-digitised commercial landscape COVID has accelerated, customers routinely interact with businesses via multiple virtual channels. They call contact centres, make

enquiries about products via social media and check the status of their orders via web chat. Whether it’s their ordering frequency and preferences, or their favoured mode of contact, all of these individual interactions can collectively provide insight into how a customer thinks, feels and behaves.

Historically though, that data has been stored in a series of discrete siloes – mobile data here, call centre data over here – with little opportunity or capacity for businesses to aggregate and understand it.

That’s where CDPs come in. They can be configured to pull data from multiple communication channels, and from internal systems such as CRM and support desks , and aggregate it to create a single customer profile – for each and every customer who deals with the business.

Having that detailed reservoir of information enables businesses to create personalised marketing campaigns and interactions that resonate with their target audiences and result in one-time buyers becoming loyal repeat customers.

Tools to take on the future

As the unprecedented explosion of data and digital adoption continues, CDPs are fast becoming essential high-tech infrastructure for all businesses that seek to stay relevant in Australia’s post-COVID commercial and consumer markets.

Enterprises that don’t adopt technology which enables them to ‘join the data dots’ may struggle to keep up with competitors whose customer experiences are consistently high quality and compelling.

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