Customer Data Platform
Lexer is the Customer Data Platform of choice for leading retailers
See how you can personalize the customer experience and drive incremental sales growth with Lexer.
Integrate years of transactional and profile data from any system to create a clean, consistent, de-duplicated record of every customer.
Discover opportunities to improve the customer experience with advanced segmentation, intelligent metrics, and predictive analytics tools.
Engage customers with personalized, omnichannel campaigns by seamlessly warehousing, syncing, or activating your data in any platform.
Master your data in weeks
The Lexer Customer Data Platform serves as your all-in-one hub for insight-driven marketing, sales, and service. With an enriched single customer view, maintained in real-time and accessible across all platforms, you can genuinely engage customers and drive profitable growth.
Customer Data Platform
What is a customer data platform?
Customer data platform (CDP) software is an all-in-one solution that combines data from multiple sources, organizes that data around individual customers, and enables the streamlined activation of that data within other systems.
Without CDPs, retail systems and teams tend to be channel-based and the data isn’t easily translated across systems. Marketers may have to wait weeks for IT and analytics teams to manually build reports and draw insights—and by that time, the data may be outdated. Additionally, siloed datasets can lead to data discrepancies due to human error, as well as duplicate customer records across multiple systems and touchpoints.
These data challenges make it difficult for businesses to understand their true relationship with each customer, slowing innovation and hampering the overall customer experience. A real-time customer data platform solves these challenges by creating a clean, comprehensive, and persistently-updated single customer view.
Because the data is combined and standardized into an easy-to-understand format, CDPs reduce the amount of time, effort, and resources required to discover customer insights, orchestrate personalized experiences across channels, and quantify the impact of various business activities on actual customer behavior.
Types of customer data platforms
The four primary functions of CDPs include:
- Data ingestion.
- Unification into a single customer view.
- Analytics and insights.
- Activation across platforms.
However, different CDP vendors have varying strengths and weaknesses in each of these areas. The different types of CDPs can be broken down into four tiers based on their core focus and functionality: data ingestion, unification, intelligence, and activation.
Data Ingestion CDPs
CDPs focused on data ingestion tend to have quick, easy integrations with most common data sources. Pre-built integrations and flexible APIs allow CDPs to ingest data in either batches or streams with little to no heavy lifting required by IT teams. However, key vendors for data ingestion sometimes struggle with actually unifying the customer record and empowering business users to easily analyze and activate data across platforms.
Lexer’s integration process has been described as “the smoothest integration” in one customer’s 10 years of IT management experience. Click here to read the integration case study.
After combining multiple data sources, the CDP also needs to be able to match those different data sources to individual customer profiles to create a “golden record” for each customer, also known as a “360-degree customer view.” This matching can be done using deterministic matching, which matches customers on exact information (such as email and phone numbers), or probabilistic matching, which matches customers on inexact information (such as a combination of last name and postal address).
CDPs with a strong focus in unification typically use machine-learning and artificial intelligence to aid this matching process. Additionally, unification CDPs might strengthen customer profiles by enriching them with data from second-party or third-party sources such as Experian’s Mosaic.
The single customer view within a CDP can give you an unprecedented look into who your customers are and how they behave across channels and touchpoints. However, simply having a single customer view won’t provide much benefit to your business. You need to pair it with analytics tools to gain sophisticated insights to inform your decisions.
The best CDP vendors for insights and decision-making provide out-of-the-box audience segmentation, predictive analytics, personalized recommendations for next-best actions, and robust measurement and reporting tools to help you track and optimize your performance across every engagement channel.
Once you’ve gained the ability to make insight-driven decisions based on comprehensive, real-time customer data, you need to be able to efficiently execute on those decisions. Activation CDPs are the highest-tiered types of CDPs, because they enable businesses to quickly draw insights, build personalized campaigns, and orchestrate those campaigns across systems and touchpoints.
The best CDPs for activation can connect to any channel, including email, social, website, and more. By connecting to your existing engagement channels, CDPs allow you to build, trigger, and automate personalized campaigns from one tool. Although CDPs are generally considered to be a marketer-managed system, CDPs with both analytics and activation capabilities can add value to every business function.
How does a customer data platform work?
Customer data platforms must go through four steps to create the core single customer view that powers every other CDP use case:
- Data Cleaning
- Unification and Identity Resolution
Once this core single customer view is created, a customer data platform’s capabilities depend on the specific tools offered by the vendor, as well as the strategies you use when analyzing and activating the data.
Let’s break down each step in the CDP-building process.
To achieve a single customer view, you need to bring together all customer, transaction, product, and engagement data from every source, including:
- Retail POS
Each of these data sources includes its own customer ID and its own record of events, maintained in its own schema, in its own cloud, all with a different API. The information held in each source includes demographics, purchase histories, customer service interactions, web and mobile browsing activities, email engagement, and more.
In order to create the best possible relationship with your customers, you need to collect this valuable data and pull it together using common linkage variables such as name, email address, and phone number.
Once you’ve gathered all this data, you need to prepare it so that it’s fit for calculation. In other words, you need to remove errors and duplicates across systems and data formats to ensure the highest-quality information in your single customer view.
In data science, it’s common to spend about 80% of your time and effort in data preparation and analysis before you can move onto higher-impact activities like predictive modelling. Streamlining this process is one of the most important benefits of CDPs.
The process for data cleaning involves:
- Validation: Ensure all provided data is correct, consistent, and reliable.
- Unification: Link records and remove duplicates.
- Normalization: Transform all data into one consistent, straightforward format.
- Categorization: Categorize data for easy segmentation, insight, and activation.
Clean data makes it easier to compare records and get the best results.
Unification and Identity Resolution
Data unification is also known as deduplication or identity resolution.
The three key principles of data unification within a CDP are:
- Identity graph: A collection of known customer identifiers that can be associated with one another. Think of this as a really big space with every record of every customer represented as individual points in that space. The goal of identity resolution is to draw links between each of those points.
- Deterministic matching: Exact matching on known fields such as email and phone number.
- Probabilistic matching: Matching using fields that aren’t exact matches, such as a combination of last name and postal address.
A CDP can take a deterministic, probabilistic, or combined approach to identity resolution, and it’s up to you to define how you want your data linked. The choices you make around identity resolution are central to how you understand and communicate with your customers, but they also need to work with your existing operational systems and business reporting.
Finally, once you’ve cleaned and matched your data into a standardized format, you need to transform it into information that’s easy for business people to understand. Predictive metrics and calculations help you create more value from your data than ever before.
These CDP metrics and calculations can include:
- Inferred gender
- Total spend
- Average order value
- Average time between orders
- Sales channel preference
- Predicted customer lifetime spend
- Predicted orders
- Churn risk
- Next best product recommendations
… and more!
Once your single customer view is created, you can use it to fuel every other CDP use case using built-in customer data platform tools such as audience segmentation, cross-channel campaign automation, surveys for data collection, and measurement and reporting dashboards.
If you’re interested in learning more before you invest, click here to read “The marketer’s guide to evaluating customer analytics software.”
Customer data platform implementation
Major IT projects such as martech integrations are notorious for scope creep, dragging timelines, and heavy lifting by IT teams—but a customer data platform implementation doesn’t have to cause headaches, as long as you approach it properly.
Customer data platform requirements for a smooth implementation include:
- Clearly defined goals and objectives.
- A carefully-chosen CDP vendor.
- A data-driven, customer-first culture.
Goals and Objectives
CDPs can solve multiple problems across the business, so it’s important to be specific about the challenges you’re experiencing, your top business goals and objectives, and key CDP use cases you’re interested in prior to the implementation. Clearly articulating these details ahead of time will help ensure an accurate scoping process and a well-managed implementation down the line.
CDP Vendor Comparison
The CDP landscape can be complex, with a variety of vendors offering different tools, integrations, and specializations. It’s important to carefully evaluate each potential vendor to ensure you’re choosing the right CDP for your business. By aligning your outlined goals and objectives with the vendor’s ability to deliver on those goals and objectives, you can choose a reliable vendor who will help you manage a smooth implementation process.
When evaluating different vendors, be sure to ask about:
- Current customers and relevant industry expertise
- Onboarding, support, and strategic consulting services
- Out-of-the-box analytics and customer intelligence capabilities
- Activation, automation, and measurement tools
- The level of technical expertise required to use the CDP
- Available integrations and APIs
- Security features and compliance certifications
CDP technology will only get you so far. The people and processes driving the use of that technology are what will create the truly transformative, revenue-generating impact of a CDP. The most effective CDP implementations are always accompanied by a customer-centric culture across the business and an adaptable team that’s eager to test and learn. You need to train your team to use the new platform effectively, fold insight-driven decision-making into existing business processes, and encourage a test-learn-optimize mindset to ensure continuous improvement.
Once you’ve implemented a CDP, when can you expect to see benefits? Click here to read “Post-deployment timeline: What changes can you expect from a CDP?”
DMP vs. CDP vs. CRM
Some of the most common questions people ask about CDPs are: What’s the difference between a CDP and a DMP? A CDP and a CRM? Do I need just one, both, or all three? How do I know which one is right for my business?
Customer Data Platform (CDP) vs. Data Management Platform (DMP)
A DMP is a centralized data platform that aggregates cookie browsing behavior to create large, de-identified audiences for targeting across digital channels.
Key differences between CDPs and DMPs include:
- DMPs are only focused on third-party data or unknown prospects, whereas
- CDPs integrate first-party, second-party, third-party data using personally identifiable information.
- DMPs do not create a unified customer profile, while unified customer profiles are a core feature of CDPs.
- DMP integrations are limited to advertising, whereas CDPs include integrations that cover the full customer journey.
- DMPs are less targeted than CDPs, but they can reach much larger audiences.
Even if you’re already using a DMP, a CDP is still an important and complementary solution because:
- In the wake of Apple’s new data tracking updates and other cookie-related regulations, businesses need to focus on building an owned customer dataset to improve personalization and maintain consumer trust—and a CDP is a much better option for doing so.
- By pairing a DMP’s extensive reach with a CDP’s personalization capabilities, you can maximize the value you get out of your customer targeting strategies.
Customer Data Platform (CDP) vs. Customer Relationship Management (CRM)
A CRM system manages the full contact history with every known customer. Originating from 1:1 sales workflows, most CRM systems now provide cross-channel contact history and servicing tools.
Key differences between CDPs and CRMs include:
- CRMs are not connected with other critical data sources (retail, online, partners), whereas CDPs can consume data from any system.
- CRM providers generally have basic integrations, but these integrations aren’t always easily managed or updated in real-time. Typically, they won’t integrate with competing platforms—or they’ll offer competitor integrations at huge additional costs. On the other hand, CDPs are non-discriminatory in the types and number of integrations they offer.
- CRMs are not designed to handle multiple data types like purchase history and web/app browsing behavior, while CDPs are designed to streamline and standardize multiple data types into one, easy-to-use dataset.
Even if you’re already using a CRM, a CDP is still an important and complementary solution because:
- CDPs combine all of your CRM data with other sources, like ecommerce, social, web/app, retail, and more, creating a single view of each customer. This single customer view enables you to draw omnichannel customer insights that improve the customer experience at every level.
- CDPs enable segmentation, clustering, comparison, and other analytics tools on any customer metric across all systems and channels.
- Using a CDP and a CRM together allows for integrated tracking and engagement with customers, leading to highly satisfactory customer experiences.
Top customer data platforms
The types and number of customer data platform vendors on the market are broad. Although there are definitely CDP vendors that are more well-known than others, precisely defining the “top” vendors can be difficult.
Ultimately, the value and impact of a CDP is dependent upon its ability to meet the specific needs of your business, so it’s important to consider each vendor regardless of their relative size or market share. Some vendors specialize in industries, verticals, and use cases which might make them a better option for your business than others.
Some of the top CDP vendors to consider include:
- Lexer Customer Data Platform
- SAP Customer Data Platform
- Salesforce Customer Data Platform
- Segment Customer Data Platform
- Microsoft Customer Data Platform
- Amperity Customer Data Platform
- Exponea Customer Data Platform (now Bloomreach)
- Optimove Customer Data Platform
- Tealium Customer Data Platform
- BlueShift Customer Data Platform
- Arm Treasure Data Customer Data Platform
- mParticle Customer Data Platform
- Lytics Customer Data Platform
- ActionIQ Customer Data Platform
- Adobe Customer Data Platform
Lexer is the CDP of choice for leading brands like Quiksilver, Igloo, Nine West, Rip Curl, Supergoop!, and more. As the only CDP specializing in retail data analytics, we help the world’s most iconic brands drive incremental sales from improved customer engagement. Click here to learn the top 15 reasons customers choose us as their preferred CDP partner.
With one of the simplest onboarding processes in the industry, Lexer cleanses and combines data into an enriched single view of the customer with no heavy-lifting required from clients. Our intuitive tools enable retail, marketing, and service teams to draw meaningful conclusions from data in ways previously reserved for experienced data scientists.
But new technology will only get you so far. When looking for a CDP, you need to choose a partner, not a vendor, to succeed. To ensure you get the maximum value from our powerful CDP, our dedicated Success team offers continued technical and strategic support with a level of care and commitment unique in the SaaS industry.
Mastering your customer data starts with a CDP.
Use the calendar below to book a meeting with Lexer.
Mastering your customer data starts with a CDP.
Use the calendar below to book a meeting with Lexer.