How can retail organizations benefit from a Customer Data Platform?

11 minute read

A use case is a statement of what a marketer wants to get out of a project, system or platform. Whether they work for a single or multi-brand retailer, if the business operates on at least two channels, marketers are going to face these use cases as the Top 5 requirements for a Customer Data Platform (CDP):

…I need to ensure data governance and compliance.
…I need accuracy and trust in my customer data.
…I need more control over my customer data.
…I need to reduce the cost and implication of change.
…I need to be able to activate and execute data.

Governance and compliance

Data control is a key consideration when using customer data to power marketing campaigns. In order to comply with the European GDPR, marketers must demonstrate understanding and application of the regulations laid down within the law. GDPR applies to all personal data held on EU citizens. The CCPA, meanwhile, only comes into force where 50% of a company’s revenue is generated through data sales. And marketers must consider the New York Privacy Act, which will be ratified in 2020.

Consent is an important ingredient of compliance and that doesn’t just mean opt-ins and opt-outs, marketers must show that consent was gained appropriately. Was it obtained lawfully, have they got a date stamp of an opt-in or opt-out, how many ways can they demonstrate the protection of data?

The law aside, to improve the customer experience it’s worth wrapping in contact fatigue and arbitration. If a retailer sends a customer 25 emails in a day, that isn’t against the law, but it will increase the likelihood that they’ll opt out of communications. Marketers will also need to have a plan for governance. For example, can they generate a Subject Access Request within the timescale demanded by GDPR? They might assume this will be taken care of by another team, but this is a function a CDP may provide. After all it should be holding all customer data from all systems, so where better to extract an SAR from? So, they should consider whether this is a requirement.

Remember, compliance is not optional, it’s something marketers will all have to deal with, now or in the future, depending on what types of data they handle. Having the ability to clean, match, deduplicate and merge data reduces the risk of data processing as it results in more trustworthy records, so if a consumer unsubscribes or opts out of emails they’ll be recorded as opted out of all emails, not just those sent through one email address.

Then, a retail marketing team will need to adhere to business-wide security standards, depending on where the data’s actually stored and held before processing. All of these things underpin how marketers are thinking about governance and compliance and what they’re looking for in a CDP.

Accuracy and trust in customer data

Any marketing team will have inbound data sources, outbound data sources and processing to think about. They’ll need to know every bit of data created and generated is accurate and trustworthy.

Many touchpoints will need to be stored for an individual if a company is to understand and analyze their behavior. They will probably have more than one device, they may have multiple addresses and email addresses, there will be social media identifiers, any point at which the customer interacts will be a piece of data that must be processed in a compliant manner.

In order to understand projected or past spend, the marketer will need to examine transactional interactions as well. But what level of accuracy do they need to go into? A classic challenge is, “I know how much was ordered, but how much has been returned?” And is the price including or excluding tax?

Accuracy and representation of data doesn’t just come down to how much is being held, but how it’s being processed too. Soft indicators might merit consideration, such as what product is the customer likely to click on, what interests them? What is their favorite color or type of fashion? What part of the US do they live in and what’s the climate like? All of this delivers an understanding of who the customer is.

The challenge is that the customer will move house, change email, get married or divorced and change their name, preferences, number of children, likes and dislikes. Everything about a person can change, except their date of birth. So how can marketers create a data platform which is not just accurate on the day it’s implemented, but will become progressively more trustworthy over time?

This is a challenge a good CDP will address. How can marketers bring this data together, in real-time, to gain a clear picture of the customer? The requirement for trustworthy data sounds simple, but it’s critical. One duplicate for every person in the database will knock the recorded total number of customers right off. If a marketer believes they know how much a customer is worth or that they’re interested in a particular line, they will treat them accordingly. But if the indicators that underpin the decision are wrong, any attempt at high-scale personalization will backfire. If data is wrong, decisions based upon it will also be wrong.

I need more control over my customer data

Retailers often say, “It takes me 3 weeks to add a new field,” or “I asked for an extract 2 weeks ago and I’m still waiting.” IT and the people that write the SQL don’t share Marketing’s sense of urgency. To mitigate the risk of not getting insights when they’re needed, Marketing must take control. This is where a CDP comes into its own, it’s about taking back control of what was a managed service.

Any marketer who has worked with databases knows there comes a point where the only way to get answers is to extract data, throw it into Excel, then load the results back into the database. Each data source must go through the process of ingestion, cleansing, standardization, verification and then matching and merging across channels and devices, in order to be added to ‘the golden record’.

The view of the golden record will depend on what the marketer is doing with it. If they’re using it for orchestration or campaign management, they’ll need detailed PII or personal data. If they’re using it for machine learning, modeling or next best actions, the behavior of the individual will be more critical than the PII.

The challenge is that if changes need to be made to any of the rules, for any system, if the marketer wants to add or remove a field, or change the skew definition, they won’t be able to do so without having complete control over every bit of relevant data. Their power will be derived from whatever Service Level Agreement they have with the rest of the business or an external organization.

So, retail marketers need control over how data is being processed. A Customer Data Platform is designed to give marketers that control. If a marketer wants to add or remove data, add a new attribute to the customer profile or populate it with a recommendation or score, they should be able to do so. That way they’ll make accurate decisions and waste less time and money trying to implement change.

I need to reduce the cost and impact of change

Every member of the Marketing Team must deal with change and keep an eye on costs, otherwise they’ll risk spending a large portion of their budget on one project. Their strategy may also take 9 months to deploy because they’re reliant on internal teams or 3rd parties to help them get there.

In a marketer’s world, change is constant. Every time there is a new tactic, strategy, channel or inbound data source, if an organization acquires a new brand, they won’t typically think, “How do I get the client list as quickly and accurately as I can, identifying any overlap?” Organizations may change ESP every 3 years, then there are other channels to think about. So, marketers may try out targeted, segmented A/B split tests and implement new processes. How can they give themselves more autonomy and mitigate the 3rd party costs, whilst minimizing the time to implementation?

If a Master Data Management approach is used to build a Single Customer View, the project will take a long time and require skilled engineers to implement. Future changes will have to be made by the Marketing Services Provider, the intellectual property ownership of the rules, structure and schema will belong to them, and if the working relationship ceases, Marketing will have to start over. So, marketers need to consider the cost not only of change, but of migration and onboarding.

Using a CDP is proven to reduce the effort that goes into change by 65%, since marketers won’t be starting from scratch but from a point where most processes are already in place. A CDP can also reduce onboarding and change costs by 75%, not just because of effort and time reduction, but because there’ll be no need for skilled engineers. With budgets being squeezed, spending money on a replacement database that adds no significant uplift isn’t the way to go. A CDP mitigates all of this.

I need to be able to activate and execute data

In this context, activating data means turning it into information that will underpin marketing decisions, while execution means sending it through any outbound channel or 3rd party system to elicit a response. This is vital, since the data must be integrated once it is clean, trustworthy, accurate and under Marketing ownership and control. There’s no point in having flawless data if Marketing can’t get at it, so many CDPs have built-in activation and integration capabilities.

Think of every type of processing a marketer may need to do (segmentation, analytics, attribution, reporting, data management, preference management, opt-ins, security) and add orchestration of journeys and campaign management. Then, look how consumers engage with marketers and it’s apparent that they touch channels and systems in an arbitrary fashion that they’re in control of.

Twenty years ago, marketers measured the success of emails on click-through and open rates. Now it’s more about attribution, achieving ROI for the channel spend and proving what works or doesn’t work. Businesses expect marketers to do this, both on and offline, more cheaply than ever before.

It’s possible to get information from 1st party products, 2nd party platforms or 3rd party platforms, and the Marketing Team may use a DMP for advertising and retargeting. Any of those inbound and outbound data sources require activation, because the data brought in is what can be pushed out again. But every channel used to engage consumers necessitates interfacing with channel and/or data partners. Some of the channel partners will interface to multiple channels.

So choosing the right partner, and the right integrations between partners for channel execution, presents a problem. When a marketer says, “I have a need to activate and execute data,” they’re not talking about exporting data or creating a file, they’re trying to put in place automation to reduce the manual effort and mitigate the risk around activating this data in an accurate, compliant, trustworthy and cost-effective manner to perform typical marketing tasks. A good CDP should take care of activation and execution out of the box. So, think about plugging a CDP into those existing platforms and whatever tools the Marketing Team might have in the future.


These are broad use cases, but they are the critical Top 5 that make up the bulk of the retail use cases represented to BlueVenn throughout any RFI or RFP. So, qualifying the investment in a CDP is about bringing together these elements to justify and represent the replacement, resolution and aspiration of marketers and the requirement to turn retail marketing budget into attributable revenue.

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