The service model evolving around CDPs

I’ve been involved with over 200 CDP implementations in the past decade. In most of these, the client or stakeholders have felt oversold and/or under-serviced by their CDP provider.  

First, don’t allow yourself to be in this position. Run an RFP on your terms with your use cases. Make sure the vendor can help you. Or, at least, know where you need more help than the vendor can provide.

As a marketing technology practitioner, I’m affronted by this wide chasm of expectations and reality. I, and many others, want to help. But first, let’s look at how we got here to understand how we can do better moving forward.

How we got here

The widespread adoption of CDPs was driven by the promise of a wide range of capabilities:

• One-click integrations.
• ID resolution & a single view of the customer across all channels.
• Marketer-friendly UI for segmentation.
• Journey orchestration.
• Personalization of experiences.
• Advanced data science capabilities.

And often, these capabilities worked in real-time. 

In 2019, Craig Howard said, “CDP is not a thing. It’s a collection of capabilities.” I didn’t initially understand the full implication of this: That CDPs didn’t all do the same things;, they were all a collection of capabilities. 

Dig deeper: What the composability revolution means for CDPs

There were so many different combinations of capabilities that few service providers could help. For marketers, their big ad agencies were and still are hopeless as solutions to help with customer data, especially first-party customer data. Many have policies that prohibit access. For IT buyers, the big consultancies lacked the marketing expertise to drive value from the CDP. 

Furthermore, they overcomplicated everything with legacy practices and legacy mindsets about what a customer data store should be. Analytics buyers may or may not have seen the value in a CDP, but it didn’t matter. They didn’t have the budget to buy a CDP or the services that come with it. 

Given this no-man’s land of professional support, CDP vendors built large service organizations with technical consultants, marketing operations professionals, account managers, customer success professionals and more. CDPs had great promise, but also a high need for expertise. Yet the vendors never resourced their services team like a consultancy would. Services were the red-headed stepchild of the CDP team, wanting to help but without the resources needed to do so. 

Furthermore, success with customer data is fundamentally a cross-functional effort. Few brands can adequately resource a customer data center of excellence. Even when they could fully staff a team, working with it was difficult for CDP providers. Software vendors tried to help, but they are not service providers. The result is frustrated clients and fewer CDP license renewals.

Other technologies adding CDP capabilities

Today, pure-play CDPs are under attack on multiple fronts:

• Major cloud computing companies added relevant capabilities. For example, Google Cloud has entity resolution, BQML, and countless others.
• Marketing automation tools have improved data management capabilities. Now, when a brand looks for a new ESP, they may end up replicating CDP capabilities or replacing their CDP.
• For big brands, Adobe and Salesforce are giving away late-to-market and arguably inferior capabilities to pick off customers from more specialized competitors. 
• For small brands, Klaviyo offers one-click implementation and rapid time to value.
• For companies with customer data warehouses, composable players like Hightouch and GrowthLoop offer compelling time to value and total cost of ownership.

Confusion abounds.

Dig deeper: What the composability revolution means for CDPs

CDP capabilities are part of a bigger solution 

So how are the CDPs responding? By involving professional service providers as part of a broader “solution” to specific client challenges.

All the CDPs have compelling value offers. But those competing with Adobe and Salesforce are fighting a difficult battle given the aggressive nature of the competition. Brands need help sorting through the confusion. That’s where consultants can help.

Dig deeper: Navigating AI’s place in the CDP landscape

While CDPs were oversold and under-serviced a few years ago, they now provide mission-critical capabilities: ID resolution, activating customer data, journey orchestration and much more. The CDP providers need help from expert consultancies to frame and position these valuable capabilities as part of the client’s overarching customer experience strategy.

Let’s look at a comparison.

For several years, service packages were commonplace in the CDP marketplace. These were often huge buckets of hours or monthly use-it-or-lose-it services. 

Now, more brands are switching to shorter-term, deliverables-based projects and forgoing the services. This is a common pattern in any downturn. However, the CDP vendors are responding elegantly. 

They often bring in consultancies early to help put the CDP into a broader solution that works with other mission-critical initiatives. And, importantly, many consultancies can offer complementary offerings from data strategy to analytics to AI, BI and campaign activations.

For example, we recently worked with a leading independent CDP provider who had completed a successful proof of concept for a publisher. The work was well-received, but lacked a few core elements:

• Confidence to deploy customer data at scale. 
• Executive scorecard for ongoing buy-in.
• ROI measurement.
• Journey orchestration in key journeys.
• AI-enablement for upsells and renewals.

Providing these is too much for most CDP vendors’ already stretched service teams. Consultants are eager to help.

Consultants can provide composable CDPs with ID resolution strategy, data engineering for key customer data feeds, ML enrichments, and more. Composable CDPs regularly find a data engineering use case beyond marketing and customer experience. This requires help from specialized consulting firms with external ML capabilities, cloud data warehouse know-how, and use case road mapping.

CDP capabilities are the mainstream

It is a testament to the value of the capabilities that CDPs helped bring to the mainstream that so many providers have embedded them — cloud computing companies, journey orchestration tools, ESPs and more. Brands must embrace collecting and activating customer data as a core component of their customer experience strategy. Today’s solution-oriented model is good for CDPs, consultancies, and brands. We will see greater adoption and usage of the relevant capabilities because of it.