Generating Business Value from Customer Data Activation Strategies
The global customer data platform (CDP) market was valued at $4.7 billion in 2022 and is expected to reach $47.7 billion by 2030. Every company that invests into a CDP to collect and store all your customer data in one place will ask the same question early on: where do you get started using a CDP to deliver business value? CDPs can be an expensive investment, and marketers are constantly under the microscope to prove their business value. We believe that a good starting point is to define a data activation strategy, which identifies the customer information you need to capture to improve marketing performance. A data activation strategy enables your business to connect the CDP to business value. This post shows you how a data activation strategy works in context of customer journey analytics, which uses the CDP as its unified data source for customer intelligence.
Why Customer Journey Analytics Matters
Have you ever received an irrelevant communication from a company that you have done little business with, such as an email offering you a discount on something you just paid full price for? That awkward lapse in the customer experience happens when a marketer lacks effective customer journey analytics.
Customer journey analytics tracks and analyzes the way customers and prospects use a combination of available channels to interact with an organization from awareness to conversion to loyalty. Customer journey analytics solves the problem of having a disconnected view of the customer’s journey by using the CDP’s unified profile, sometimes called a “Customer 360 view,” to gather intelligence.
The main difference between customer journey analytics that uses a CDP as its data source and website analytics is the scope of the data that is collected. Customer journey analytics collects data from all channels, while website analytics only collects data from the website. This means that customer journey analytics can provide a more complete picture of the customer experience.
When businesses use customer journey analytics to get a complete profile of how the customer is engaging with the brand, the marketer can make more sensible and valuable offers. For instance, instead of offering your customer a 25 percent discount for a product they just bought, you would know they just bought it, and you can send an add-on to complement their purchase. The more relevant an offer is, the more likely it is to convert.
Customer Journey Analytics Needs Data Activation
A CDP gives a business the data it requires to perform the customer journey analytics needed to deliver the right offer at the right time to each customer depending on where they are in their journey. But the scope of data to collect is vast. This is where a data activation strategy comes into play. A data activation strategy maps out how the business will use customer journey analytics. For instance, a data activation strategy could identify the different ways analytics helps the business during key steps in the journey, such as:
Report the actions a customer takes. Example: a CDP stitches together in a unified profile all known data about the customer to be the source that identifies whether someone clicks on a retailer’s ad promoting a sale and purchases a product on its website. Customer journey analytics helps the retailer attribute the purchase to the advertisement.
Analyze the “why” behind an action. Example: a telecommunications provider offers a new customer a sign-up program through an online campaign but notices that prospects are dropping off the website after initially showing interest in an ad. Customer journey analytics reports why the problem occurred. Perhaps customers are abandoning the shopping cart during sign-up because the provider is asking for too much information, or the user experience is confusing. Analytics helps the provider course-correct the problem.
Predict a customer’s future interests and actions, which is valuable data for anyone who wants to personalize offers. Example: a music or movie streaming service uses analytics to dig deeper into a customer’s content preferences. Based on the customer’s tastes, the provider can reasonably predict that the customer will respond favorably to personalized content that the streaming service recommends. From there, the provider can create a better experience by recommending songs, movies, or TV shows that keep the customer engaged in the service.
With this information designed by the data activation strategy, a business can create a holistic view of the customer’s behavior as opposed to tracking a bunch of disconnected actions without tying them all together into a complete portrait. The benefits range from creating more successful marketing campaigns to building stronger customer loyalty through personalized experiences.
A number of CDPs support the creation of customer journey analytics. Adobe is a leading example. Adobe’s website shares more in-depth information on how the process works. At Centific, our CMO.AI practice partners with businesses such as Adobe to help businesses maximize the value of their CDPs.
Contact us to learn how we can help you.