Why marketers need CDPs in 2022
2026-03-06 01:15 Diff
https://useinsider.com/why-marketers-need-cdps-in-2022-everything-you-need-to-know-in-a-customer-centric-cookie-free-digital-world/

The state of cross-channel or multichannel marketing

Customers are like bullfrogs — they jump from one surface to another in order to find what they are looking for. 

Think back to the last time you tried to find a dress. You probably filtered selections on a brand website, scrolled through an Instagram store and jumped between multiple shopping apps before making a decision—and you’re not alone. It is a human tendency to weigh as many options as possible before committing to a purchase to avoid ending up with buyer’s remorse. 

Multichannel and cross-channel marketing leverage the fact that customers are persuaded in different ways and are present in more than one place at a time. In fact, according to Gartner’s research, technology service providers using more than 10 channels in their marketing campaigns saw a 7% increase in conversion rates across the marketing funnel over firms using fewer channels. 

Let’s take a look at brands that do multichannel and cross channel marketing well and the long term effects of these strategies.

Case Study 1: Apple (Long Term Cross-Channel Marketing)

Apple sells the majority of its products online but also invests heavily in its physical store. Its brick-and-mortar stores allow customers to test out products, experiment with new features, and browse accessories — delivering an experiential touchpoint for its eCommerce stores. The brand’s message of delivering on excellence in design and function is demonstrated in the product, advertisements and even its store design—tapping into multiple touchpoints to attract buyers at every stage. 

Case Study 2: Samsung (Product-Based MultiChannel Marketing)

When Samsung launched Galaxy Note 9, it leveraged multichannel marketing liberally. It devised a Web Push strategy that targeted some of its competitor’s devices and promoted the new Galaxy Note 9 devices. Web Push messages attracted new prospects while reducing the instances of cart abandonment for Samsung.

As a result of Cart Recovery Web Push Notifications, the Samsung marketing team was able to boost their web push click-through rate by 14%. Also, the conversion rate of these notifications was 24% higher compared to the conversion rate Samsung achieved with standard Web Push notifications.

Samsung optimized its mobile web page layout automatically based on a visitor’s last-clicked category. It now welcomed each visitor with a  customized view of their products and categories based on visitor preferences.

This simple tweak led Samsung to drive over 10% conversion rate uplift.

A strategic long-term approach to multichannel marketing builds a brand, and a targetted cross-channel approach builds sales — both are crucial in helping a brand succeed. According to Insider One Intelligence, forecasters expect multichannel sales to make up close to 46% of all eCommerce sales by 2023.

But what do these cases tell us?

The common thread between these successful case studies isn’t a brand new marketing strategy or even an in-house multichannel marketing team. The common idea is to analyze where customers are dropping off and how they can be brought back.

It is to answer the questions —

  1. At what point are your customers leaving?
  2. Where are they going next?
  3. How can we bring them back?

But finding the answers to these questions without integrated customer data is nearly impossible. Marketing leaders—like many leaders—are data-rich, but crave insights: 46% of marketers say they lack timely data to make strategic decisions. Out-of-context customer data only makes matters worse because it generates misleading insights. 

At the same time, we are venturing into a new era where third-party cookies have disappeared and it is becoming progressively harder for marketers to ethically understand their customers. 

The third-party cookie is disappearing and system updates are putting a premium on privacy

As Google announced the discontinuation of third party cookies from Chrome browsers in 2022 and Apple its 14.5 OS updates, Salesforce speculated the impending impact on marketers:

‘Marketers turn to an array of data sources to target individual customers and prospects across their unique journeys. As Apple, Google, and others restrict the use of third-party cookies, however, the relative popularity of data sources is shifting. Known digital identities such as email addresses and social IDs are now the most popular customer data sources, followed by transactional data and declared interests and preferences. Offline identities such as postal addresses and anonymized digital identities like cookies and device IDs saw the biggest year-over-year drops in popularity.’

In short, first-party data just became infinitely more valuable and handling it optimally became significantly more important. 

How does integrated data help multichannel marketing and a cookie-less state of affairs?

Here are some answers from experts —

  • The most obvious strategic shift is a move away from individual user tracking and towards more contextual advertising. This means getting close to the patterns of the customer journey, rather than following each customer’s journey – Digital Marketing Institute
  • “While things look grim for one type of cookie, this might not be a bad thing for skilled and adaptable brands.” – Hubspot 
  • Starting today, marketers should start building and expanding their first-party data strategies before third-party cookies vanish. You can build these data sets using a combination of channels. Include data from users who log into your websites, subscribe to your newsletters, fill out forms and whose data is stored in your customer relationship management (CRM) software. By collecting this data, you can seize the opportunity for progressive profiling. – Forbes

To sum up, identifying patterns in customer journeys, a combination of multiple marketing channels, and trustworthy customer profiles are going to help smart brands scale. 

The automatic next question becomes –

How do we build progressive customer profiles that drive growth?

Customer Relationship Management Platforms are a good tool in the initial phase as the premium on customer-centricity skyrockets. 

“Customer experience is the number one driver of growth in 2021 and beyond. This has been happening for a while, but 2020 really accelerated trends in digital transformation and buyer-seller relationships and there is no going back.” – Yamini Rangan, Hubspot CEO 

In a survey of marketers by Salesforce, when asked how which factors impacted the state of marketing, ‘Customers’ was by far the most popular choice with a 63% vote. The emphasis on not just educating, but also empowering the customer is growing at a time when customer data itself, is being protected. This overlap of conditions makes customer data a highly valuable resource and one that should be utilized prudently.

However, while handling customer data, Customer Relationship Management Platforms (CRMs) falter in three crucial aspects, according to multiple Harvard Business Review reports:

  1. CRMs cannot deliver without a customer strategy: 

CRMs cannot fix the problems that out-of-context customer data creates. Unsegmented and out-of-date data creates the illusion of information without providing any actionable ways in which to use the information. Kind of like an IKEA product without the brochure —  just a jumble of parts.

  1. CRMs serve too many masters: 

Marketing, Sales, Data, Finance teams all seek answers from the CRM and, sometimes what poses as a success for one department, is a threat for another. Secondly, the data entered into a CRM by each department is through the perspective of their respective development goals and this leads to a dilution in the reliability of the data and multiple sources of truth. 

  1. Development of Conflicting Ideal Customer Profiles (ICPs) for Sales and Marketing: 

When data is input into the CRM by both teams mutually exclusively, it builds some confusing ICPs. Since marketing and sales goals are not always aligned, the data vault created has multiple loopholes.

For example, Marketing might create an aspirational ICP to attract higher-ticket buyers and Sales might create a realistic ICP to target more people in the existing customer data metrics. 

Creating multiple sources of truth will lead to a ‘two steps forward, one step back’ development plan. 

Is it possible to create a single source of truth and maintain data integrity?

It is — through Customer Data Platforms (CDPs).

CDPs collect first-hand information from multiple forums —websites, newsletters, social media profiles, customer feedback, surveys — where the audience is present. Ordinarily, demographic, transactional, and behavioral data exists in silos in a companies records for internal analysis. A CDP does an excellent job of bringing this disconnected data together. Combining it allows CDPs to build a single customer overview and address marketing and sales challenges on multiple levels. 

Data that is connected across multiple channels gives deep insight into not just how the channels are performing but also how your customers are thinking—creating an excellent marketing framework.

For example, reversing churn is a significant challenge for both established and growing businesses. 

Customers leave because their preferences change over time or because they have had a poor customer experience. In a survey by Zendesk, 66% of customers admitted to having had terminated their relationship with a company due to poor customer experience. 

A CDP continuously refreshes customer data over time and builds a progressive customer profile — updating a customer’s interests, segment status, and buyer preferences. Up-to-date data helps marketers make relevant decisions and create high-conversion campaigns. 

If a low intent buyer is browsing more frequently, it indicates the marketing team to step up the marketing efforts and promotions a notch. If a customer is showing signs of lowered activity, marketers can entice them back before it is too late.

Understanding how customer behaviors change over time—and acting before they actually leave—can significantly reduce churn. 

However, being a relatively new technology early-stage CDPs come with their own set of challenges. 

  1. Partially integrated data: 

Since CDPs rely mostly on first-party data, there might be gaps in customer insights.

  1. Legacy Analytics: 

For CDPs to be effective, the analytics engine built into the platform should use advanced Artificial Intelligence technologies for customer segmentation. 

While both CRM and CDPs have advantageous features, they both lack a few key metrics to deliver a truly exceptional customer experience. 

What is required here is a solution that goes beyond silos. It is also important that this data be analysed thoroughly to build actionable insights from which Marketing, Sales, and Customer Success Teams can create winning strategies.

Unifying CRMs and CDPs does the trick. 

Each loophole in one system is plugged by the competencies of the other and unifying data becomes simple. 

CRMs hold historical and manual customer data with the end goal of enhancing customer experience but are ill-equipped to input data pools from multiple sources.

Customer Data Platforms are designed to ingest all customer data across all forums. Advanced CRMs segment the data and provide the answers to the three questions conversion markets want to know –

  1. When are customers leaving?
  2. Where are they going next?
  3. How can we bring them back?

Let’s take a look at this in action —

Avon, an eCommerce beauty and home goods company, unified its CRM and CDP to increase their average order value by almost 11%. Using an AI-powered recommendation engine, Avon was able to place personalized product recommendations in front of customers who were ready to buy. Avon was meeting them where they dropped off and encouraging them to come back. 

This was possible due to a scaled customer segmentation — they understood that people buying beauty products needed to hit the sweet spot between beauty trends and personal style— and their campaigns did just that. Avon positioned user-based recommendations together with discounted products to deliver customized buyer packages— and people bought.

Additionally, Avon also built Instagram-like stories on its mobile web. Integrating data from their CDP and CRM allowed them to develop stories to present their customers with personalized last-minute deals, and seasonal offers. 

To sum up, CDPs answer customer-centric questions that yield converting marketing campaigns. They create a single source of information on which all teams can harness for growth. Using this data intelligently has created winning campaigns for global brands and helped them boost brand loyalty and customer retention. 

Why should Customer Relationship Managers care about CDPs?

Here are a few reasons-

  • Customer relationship managers benefit greatly because instead of just numbers and data on their customers they now have a playbook.
  • Instead of having to deal with individual concerns, they can now develop solutions for patterns and even inform the content and marketing teams of customer wins. 

CDPs create a virtuous loop. 

Here are three irksome Customer Relationship challenges that a CDP solves:

  1. Understanding customer concerns in time:

Customer concerns of a similar nature can be clubbed under organised umbrellas with CDPs. This information gives customer relationship managers ammunition when handling customer queries and it allows them to offer remedial measures before customers become dissatisfied.

  1.  Declining customer loyalty:

According to Hubspot Research, 55% of customers now trust companies less than they used to. Declining customer loyalty is a nightmarish concern for customer relationship managers, and for good reason— happy American customers will share their positive experiences with and refer about 11 people—helping grow the customer base. 

CDPs create a detailed customer overview that creates a table of customer concerns and pain points. Customer relationship managers can address these in time to make sure their customers stay loay, return often, and recommend them liberally. 

  1. Reducing Churn: 

When CDPs give marketers the answer to ‘where are our customers going next?’, it becomes easy to reach there ahead of time — offer in hand. 

Whether customers are leaving to browse their social media accounts, check their emails, or browse the internet—CDPs provide a viable path to be present there.

Why should Digital Marketers and eCommerce Managers care about CDPs?

Here’s why –

  • Fifty-eight percent of consumers expect to do more online shopping after the pandemic than before, and 80% of business buyers expect to conduct more business online—making both customer data acquisition and understanding a valuable resource.
  • Seventy-eight percent of high performers say they use a customer data platform (CDP), versus 58% of underperformers.
  • CDPs create a single source of truth: 86% of marketing leaders report that they have a single source of truth for content production, campaign production, and analytics. 

Having an unbiased customer overview is essential if you have to market and sell effectively. Data on your ICPs must not be watered down by biased data entries from individual departments. An advanced CDP’s artificial intelligence engines process first-hand data to build robust ICPs that can be relied upon by digital marketers and eCommerce managers when making decisions on both marketing and inventory. 

Beyond data structure and integrity, here are four recurring marketing challenges that a CDP solves:

  1. Expanding Customer Base:

CDPs give a 360-degree view of both existing and potential customers. Advanced CDPs with Artificial intelligence technologies can model lookalike buyer personas and help marketing teams target those with awareness campaigns. 

  1. Creating upselling and cross-selling opportunities:

A customer might select a specific list on a website but choose a loosely connected product through an email promotion. For example, a set of upholstery and cushions on the website but a lampshade from an email brochure. A CDP connects this data to understand that the buyer might be looking to redesign their bedroom and create a packaged offer based on the customer preferences — combining bedding sets, upholstery, bedside tables, and lamps.

  1. Increasing Personalization: 

Packaged offers, cross-sells, and abandoned carts can all benefit from personalization. A personalized cushion cover in a home decor kit, or a customized laptop sleeve with the purchase of electronic goods can accelerate both customer acquisition and retention. In fact, 91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them.

  1. Tapping into a customer’s personal circle: 

81% of customers trust recommendations from family and friends over those from companies. In the world of psychology, this phenomenon is referred to as in-group favoritism — and is very hard to shake, even if the social groups are meaningless. A CDP collects information from a customer’s social profiles and creates recommendation models based on suggestions by friends and family — making your brand a part of your customer’s inner circle.

As the entire business world becomes digital, the pressure to compete to stay relevant and top of mind is steeped in clear customer profiling and enhanced customer experience. 

Let’s illustrate the results CDPs can get, with an example –

CDPs inbuilt into Marks and Spenser’s website tracked users as they browsed individual collections, instead of tracking the usual time-spent-on-website. As soon as they left, Marks and Spencer crafted a timely web push promotion to entice them back. A particularly successful conversion through this method as seen in their 4 pairs for three women’s underwear campaigns. 

In this case, Marks and Spencer saw the potential in bringing back customers who had abandoned their carts with a simple push notification. 

The CDP answered all three questions – when are customers leaving (browsing a particular collection),  where are they going next (still on the web browser), and how they can be brought back (personalized promotion). 

What measurable results does a well-integrated CDP deliver?

  • The simple push notification system built into the Marks and Spencer’s website increased the abandoned cart recovery rate by 11% (vs the 3.3% average). 
  • In the case of Samsung illustrated above, focused web push notifications increased the conversion rate by 10%.
  • In the case of Puma — with an already intuitive website and notification system — CDP implementation went one step further. To boost their Halloween sales, Puma introduced a scratch-to-win offer with discount codes. Integrating a CDP allowed them to offer personalized vouchers in a gamified garb — much like the Halloween experience itself. 

As a result, Puma’s Halloween sales surpassed the rest of the sales in October for Puma due to this creative upselling strategy made possible by advanced CDP analytics. 

It is easy for marketers to replicate results that get these conversions.

How do we execute these results?

Here’s how to effectively execute these for yourself using advanced CDPs—

  1. Creating progressive customer profiles: 

These profiles help marketers create focused campaigns and customer relationship managers address concerns with a deeper degree of understanding.

  1. Audience Building: 

These progressive customer profiles can be segmented into unique audience IDs that classify customer groups based on intent and action. 

  1. Activation: 

This segmented audience analysis should be integrated with the company tech suite to make this data accessible to all customer-facing departments. 

Rivièra Maison, an exclusive home and interior brand implemented this 3-step strategy and achieved incredible results. 

Riviera Maison sells a lot of products across home decor and interiors which made it tricky for potential buyers to navigate through the site. They wanted to simplify product discovery and site navigation to increase their order value.

They used AI-powered engines to identify user behavior patterns to create a personalized experience for customers shopping on their site. Personalized ‘top searches’ were added to the main navigation and the brand observed a 17.08% uplift in average order value. 

Upon adding another section for recently viewed products (personalized for each customer) the average order value increased further. It was so successful that now the ‘Recently Viewed’ section sits as a native block on their site. 

Why should we trust Insider One?

Ruggero Loda, the Senior Digital Performance Manager at Riviera Mason tells us that site navigation for such a complex range of products wasn’t intuitive and customers needed a better journey inside Riviera Mason’s online shopping portals— especially with competitors becoming more strategic. They wanted an online customer experience that felt like an in-store one. 

Having implemented Insider One’s personalization solution to boost their average order value, this is what they have to say:

“Insider One was the right choice because of the ease of integration, complementary product stack, and Insider One’s experienced team of growth consultants. For brands looking to achieve their full spectrum of digital growth goals, Insider One is a good choice.“

Moving forward, Riviera Mason plans to amplify personalization across all its media and digital channels with Insider. 

Ruggero Loda is not alone in feeling this way. Insider One is recognized by review platforms such as G2 as one of the leading Customer Data Platforms with a ranking of #1 and a rating of 4.7/5. 

Leading analyst platform Gartner also recognized Insider One in its Magic Quadrant for Multichannel Marketing Hubs in 2020. 

The conversions and higher click rates are tangible aspects of Insider One’s suite. Relationship-building is an intangible asset that pays life-long dividends in customer retention. 

The Senior CRM, Loyalty & Channel Innovation Manager at Marks and Spencer confirms the relationship-building value of Insider One’s customer data platform –

“Working with Insider One has been a great process. The account management team is always really proactive and Insider One web push channel complements our existing tech stack, providing a new and effective way for us to communicate with our customers. Implementation is a simple tag that you put on your site in order to go live. For many companies, I can see this being a great quick win to boost traffic and conversions.”

Do you want to want to read more about how Insider One’s Customer Data Platform has helped global brands like Decathlon, Samsung, Toyota, Carrefour, MediaMarkt? Read our multi-faceted success stories here.

Or book a demo to see how we can help you!