Adobe and Salesforce entered the customer data platform (CDP) mix last month, a big boon to marketers seeking validation as they look to fit CDPs into their marketing technology (martech) stacks. The digital experience software providers, which seem to be going head-to-head in the martech race, debuted CDPs within a day of one another.
First it was Salesforce, which on March 25 announced it was building an “enterprise-grade Customer Data Platform” that extends Salesforce Customer 360. That platform debuted at Dreamforce last year and is designed to “enhance data management across Salesforce apps" and provide access to customer data.
The next day, it was Adobe’s turn, announcing at its Adobe Summit the global availability of Adobe Experience Platform, a customer experience management (CXM) offering that includes a CDP. Adobe officials said it "brings together known and anonymous data to activate real-time customer profiles across multiple channels with "intelligent decisioning and segmentation."
A quick CDP refresher: it is a “packaged software that creates a persistent, unified customer database that is accessible to other systems,” according to the CDP Institute. It requires less technical assistance to manage than a data warehouse and “puts marketing in direct control of the data unification project.”
CDPs No Longer a ‘Passing Fad’?
So Adobe and Salesforce threw their hats into the ring. The big question for marketers? What do Adobe’s and Salesforce’s moves into CDP territory mean for my own martech stack in terms of data management? Does it validate and end some earlier fears of CDP being hype or, as a key Salesforce marketing executive himself noted just less than a year ago, are CDPs still “a passing fad”?
Bob Stutz, CEO of the Salesforce Marketing Cloud and chief analytics officer, less than a year ago shared his thoughts with AdExchanger, “I think it’s a passing fad,” said Stutz. “Or really more of a temporary state as people are looking beyond a DMP, the connection to a CRM and evolving to mobile. It’s what people are doing already. What I think you’ll see in a couple years is that many of the three-letter acronyms will go away and these things will blend together in a more seamless way.” (Hat tip to Apoorv Durga of Real Story Group on that find).
That’s the same Stutz who blogged last month about Salesforce’s new CDP, touting its arrival in the market.
Related Article: What is a Customer Data Platform (CDP)?
More CDP Confusion, Doubt
Wait, what? What should I do as a marketer with that? Salesforce is out on CDPs. Salesforce is in on CDPs. Adobe joins. Confused yet? Many are. In response, the CDP Institute came out with RealCDP, a program to "reduce the confusion plaguing the Customer Data Platform industry."
While confusion persists, criticisms remain for CDPs, a fact that Stutz himself noted last month in his Salesforce CDP blog. He cited Forrester’s October report that for B2C marketers, CDPs overpromise and underdeliver (fee required); and Winterberry Group’s findings from last month, which report “there’s a strong need to clarify not only what a CDP is and isn’t, but also how these platforms can deliver value to marketers.” It also found that while more than 100 companies describe themselves as a CDP, fewer than 20 are true CDPs according to Winterberry’s definitions: “Platforms that are able to ingest and integrate customer data from multiple sources; offer customer profile management; support “real-time” customer segmentation; and make customer data accessible to other systems.”
Related Article: Is That New CDP Truly a Customer Data Platform?
CDP Investments Run Deep in Market
Despite reports of an early demise, marketers should also take note of CDP's growth. According to a January report by the CDP Institute, the CDP industry in 2018 added 29 vendors, 2,600 employees and $173 million in funding. The year before, the industry added 26 firms and 2,200 employees. Adobe and Salesforce are likely now added to the CDP Institute’s January list of 78 companies identified as CDP vendors. Total vendors increased by 60 percent and employment increased by 65 percent in 2018 while funding rose by 23 percent.
And if that’s not a signal of growth, this month a CDP vendor netted the industry's largest funding round yet. Segment, which calls itself a customer data infrastructure company, just announced a $175 million round of new funding. The Series D round brings Segment’s total amount of capital raised to $284 million. The CDP Institute, founded by David Raab of Raab Associates, classifies Segment as a CDP provider.
And now come Adobe and Salesforce. “I take it as proof that marketers are pressing those vendors for CDP solutions,” said Raab. “Prospective buyers need to be careful to find a solution that meets their needs for core CDP capabilities." This includes ingestion of all types of data, structured and unstructured, and retention of the complete original details, not just summaries or metadata. It also includes the ability to integrate on equal footing with all products, not just a vendor’s own tools.
Marketers also need to look at cost of ownership including purchase price and technical staff requirements. Check how close to release those vendors’ products are, Raab said, noting, “Adobe and Salesforce have announced well in advance of any actual product being ready."
Related Article: Customer Data Platforms Shine Where CRMs Fail
CDP Work Far From Done
Although Adobe and Salesforce’s move “further validates the market,” a marketer's work ingesting data and getting value in terms of experience is far from over, said Angel Vaccaro, principal at Deloitte Digital and leader of the Deloitte Digital Experience services offering. “Obviously there's a lot of competition in the market, but a rising tide raises all ships,” she said. “And I think that more than ever, it's proof that the technology’s ready to be able to deliver on these personalized experiences at scale.”
She added that the challenge for marketers still remains in the underlying data and how to effectively use it for experiences: things like data cleansing, data enrichment and actually getting it into the CDP and making it actionable are still part of the game. A report last week by Ascend2 (sign-in required) found half of marketers say apps used for optimization, personalization and testing are the “most difficult types of martech." Experience/relationship marketing and marketing data/dashboards/analytics are next with 40% and 39%, respectively.
“Bottom line: Adobe and Salesforce are validation of the market,” Vaccaro said. “The need and the time is now, but it's not like you can just install a CDP and it’s magic. There's a lot of underlying data work that needs to be done in order to get the value out of that CDP.”
Related Article: Can VoC Data Easily Integrate With Customer Data Platforms?
Questions Remain on Martech Stack Impact
CDP inquiries among marketers have “skyrocketed” though questions still remain on what it means for their martech stacks, according to Carl Agers, senior vice president of marketing services at Hero Digital. They want to know what a CDP actually is, what architecture is needed to achieve success and the implications for components of their martech stack.
The moves by Adobe and Salesforce didn’t surprise Agers because the “marketplace is telling them that there needs to be a better answer." Agers added, "In a progressively dynamic, personalized world, he who owns the data wins."
Agers said he wonders about the future requirements to obtain value from Adobe's and Salesforce’s CDPs. Too early to tell now. “What companies are doing now is a pretty heavy lift, and some of them really never get there,” Agers said. "If Adobe or Salesforce can help marketers lessen the burden of custom development and configurations and leverage platforms like Einstein and Sensei to normalize data models to identify segments at speed, then that’s pretty magical.”
Related Article: Customer Data Platforms: A Contrarian's View
Competitors: Thumbs Up, Thumbs Down to Adobe, Salesforce
One executive from a competing CDP vendor gave Adobe’s and Salesforce’s CDP foray “two thumbs up.” Erik Archer Smith, marketing director for ABM at Arm Treasure Data, said it’s validation for a market some analysts said would be a “stepping stone to a larger thing.” Adobe and Salesforce are the leaders in the space and for them to be officially stepping into the CDP space is “extremely validating.”
Archer Smith said the move won’t change things for CDP vendors like his. If you’re an “Adobe loyalist” or a “Salesforce loyalist,” you’re invested in their suite anyway.
Brian Cleary, vice president of solutions marketing at RedPoint Global, a CDP vendor, did not cite Adobe and Salesforce by name, but told CMSWire regarding the CDP Institute's RealCDP news, "There has been confusion in the CDP market which has only been exacerbated by the marketing clouds claiming to also have a CDP offering or strategy, walking back from their initial positions."
The holy data grail for marketers regardless of the CDP vendor is having one version of the truth, according to Robert Durrant, CEO of rev Branding. “These two companies (Adobe and Salesforce) have launched these products … because they've recognized that the ability to bring everything together in one place, to have one version of the truth, one area of total visibility of that consumer, and the way we engage that is the path to the future.”