According to a Gartner study, inquiries into Customer Data Platforms (CDPs) have quadrupled over the last year. Analysts have informally dubbed 2018 the “year of the CDP RFP.” The CDP market has become saturated with vendors claiming to be CDPs. And enterprise brands for which KPIs like lifetime value, loyalty, and retention rates are priorities are clambering to find a solution that will help them differentiate on customer experience. As a testament to this momentum, Gartner has been ramping up its research on Customer Data Platforms (CDPs).
Just this week, Gartner published two new important pieces of research that provide practical and useful tools for enterprise marketers. Along with Gartner’s “A Marketer’s Guide to What Is – and Isn’t – a Customer Data Platform,” which was published earlier this year, this new research helps to give important definition and clarity to the CDP category while giving marketers the tools they need to evaluate and purchase a solution that will meet their needs around unifying, gaining insights from, and activating customer data for engagement and orchestration.
What Is - and Isn't - a Customer Data Platform
Gartner’s “A Marketer’s Guide to What Is – and Isn’t – a Customer Data Platform” (login required) helps clarify the category’s definition. With over 80 vendors now claiming to be CDPs, many marketers are confused. Tag managers, mobile app vendors, personalization tools, and many other types of technologies, have rebranded themselves as CDPs in order to capitalize on the CDP hype, funding, and growth trajectory. (Worth bragging about: AgilOne is in the unique position of having been a CDP for over ten years. Compared to others in the space, our solution is very mature and we have well established customer successes.)
We like the “Marketer’s Guide” because it provides a good roundup of capabilities that companies should look for in a real CDP. The guide also provides clear charts that illustrate where there is some overlap across technologies, show where CDPs are differentiated in the martech landscape, and articulate when CDPs should be considered over similar – but different – types of solutions.
Create a Business Case for a Customer Data Platform
Gartner’s “How Marketers Can Create a Business Case for a Customer Data Platform” (login required) addresses another hot topic; building an internal business case is something we see marketers struggling with all the time. CDP adoption is most successful when a company has aligned itself around the idea of customer-centricity, and teams that span marketing, IT, digital, merchandising, customer support, stores, etc. should come to a consensus on CDP goals and objectives before embarking on the search for a CDP vendor. This is no easy task, but it’s an important early step that should come well before issuing an RFP. (TUMI’s Chief Digital Officer, Charlie Cole, has shared his experience with building alignment and a business case for AgilOne’s CDP in this presentation, this webinar, and this article.)
We like this piece of Gartner research because it provides a practical, thorough, and editable template for brands to build their own CDP business case. The template includes several specific capabilities to weigh when building the business case. These capabilities reinforce Gartner’s other research about what features make up a CDP in the first place.
To Build or to Buy?
Gartner’s “How to Decide Between Building or Buying a Customer Data Platform” (login required) addresses a dilemma often faced by organizations that have the resources to build a solution in-house: should a company build a CDP using its own resources, or should the company invest in a technology vendor’s solution? This article gives thorough consideration to both options, but generally comes down on the side of buying a CDP vs. building one, for these reasons:
- The labor costs of building a CDP in-house is exorbitant (requiring engineers, developers, and data scientists); whereas commercial CDPs are a defined cost and quick time to value.
- The opportunity cost of not using a commercial CDP is also considerable. What other things are not getting done when your resources are wrapped up in building a CDP?
- For brands in mature markets (retail, travel, financial services) who must differentiate on customer experience, there is the risk that they will lose out to competitors in the time it takes to build a CDP.
We like this research because it thoroughly weighs the capabilities that should go into a Customer Data Platform, regardless of whether a brand builds or buys. It’s worth noting that some of the capabilities called out in the report that are not provided by many CDP providers (e.g., identity graph, integration with call center systems), are in fact part of AgilOne’s CDP. This is just another advantage of AgilOne’s maturity in the CDP space over CDP vendors that are just startups or that are legacy solutions from other non-CDP markets.
If your company is looking in to CDP vendors, download this CDP RFP template to help determine what customer data platform criteria are important for your organization, and to help you develop your own RFP.