News Analysis
The Customer Data Platform (CDP) space saw its largest addition of vendors (22) in the first half of this year, more than any prior six-month stretch, according to data from the CDP Institute.
The CDP Institute — which defines CDPs as “packaged software that creates a persistent, unified customer database that is accessible to other systems” — found these new CDPs include businesses that were founded as CDPs, established companies that have repositioned as CDPs and companies that have added CDP capabilities to existing product lines.
Perhaps the biggest finding? Enterprise CDPs have officially hit the market. The market once solely dominated by pure-play CDPs now features the arrival of CDPs from Microsoft, Adobe, SAS, Salesforce, Informatica and Oracle, vendors that are “likely to take a significant portion of the enterprise market quickly,” according to report author David Raab, founder of the CDP Institute.
Market Assessment Gets Deeper
What does the arrival of these enterprise vendors mean for the CDP buyer, which, according to Raab, are composed namely of marketers who see CDPs as alternatives to data warehouses, data lakes and CRMs? What does it mean now that the billion-dollar companies are offering CDP software alongside the pure-plays that built the market?
“It forces buyers to be a little more technical in their assessments,” Raab told CMSWire. “Because often buyers are pretty casual. They just assume the vendor does what the vendor claims to do, but now they have to actually assess some of these other (enterprise) products. They have to justify to the IT department or whomever they have brought to the table why they don't want to buy a certain product. So in that way it's actually a good thing because we're always in favor of buyers doing a more thorough job than they might otherwise do.”
Related Article: Lessons Learned From CDP Implementations
Advantages for Pure-Plays
Raab doesn’t quite see existing pure-play CDP users abandoning their customer data software suite in favor of the enterprise CDPs just because they’ve hit the market, or because they already use some of their existing software. “You’re not going to abandon an existing CDP implementation just for the joy of using Salesforce because it's a lot of work to switch over or deploy a new one,” Raab said.
But why wouldn’t prospective CDP buyers dig into these enterprise suites? Many of them are likely already using all or part of their multiple marketing and customer experience software solutions, often branded as marketing cloud suites. They should, but Raab cautioned these enterprise CDPs, even with their presumed abilities to play well within their own marketing and CX cloud suites, are all 1.0 releases. He cited Adobe’s release this month of data-governance capabilities in its real-time CDP offering. Governance is a feature Raab’s seen in many CDPs prior to this month, leaving vendors like Adobe “still playing catch-up.”
Raab also sees an another advantage alongside product maturity for the pure-play providers: easier integration across multiple clouds and non-cloud systems. “They're not terribly mature,” Raab said of the enterprise CDPs. “The buyers have to look carefully at what's really being delivered today as opposed to what's on the roadmap. Again, that's kind of a second level of depth to get to that not everybody really gets to."
Related Article: Choosing a CDP? Don't Miss These Red Flags
Enterprise CDP Arrival Has Market Benefits
Buyers’ selection journeys aside, the entry of enterprise technology vendors into the CDP category is tremendously impactful, according to Joe Stanhope, vice president and principal analyst for Forrester serving B2C marketing professionals. “It fundamentally changes the market dynamics for a few reasons," Stanhope said. Enterprise CDPs can improve the performance of the vendors’ own technologies by enhancing data quality and portability across their complex and disparate ecosystems. That, he said, will appeal to these vendors’ existing client base.
Further, enterprise tech vendors are now pushing the concept of a CDP beyond what the industry's seen historically from standalone CDP vendors with advances in data management, analytics and customer journey coverage. “The economic reality is that these vendors have massive market presence and a substantial client base of committed users who have interest in CDP-type capabilities,” Stanhope said, “which will likely confer significant and accelerated market penetration."
What Say You, Pure-Play CDP?
Representatives from pure-play CDPs told CMSWire the entrance of enterprise CDPs into the market validates the industry — but they weren't without their inevitable criticisms, too. Sav Khetan, VP of product at CDP provider Tealium, said enterprise CDP arrival confirms what vendors have known from the beginning: companies need a truly unified way to manage customer data in real time. “CDPs are now — and have been — a necessary part of every company’s tech stack,” Khetan said.
Predictably, Khetan did take the opportunity to be critical of the enterprise CDPs, adding, “these companies are creating a lot of noise and confusion in the marketplace, interfering with a lot of companies' current plans because they’re being told to wait on these newcomers. What they’re waiting on is slideware to become products, but the problems the CDP buyers need to solve are still happening today. Third-party cookies aren’t going to stick around and CCPA won’t wait to enforce because you don’t have a CDP operational.”
Buyers will have to decide if they want their CDP technology to live within the walled garden of a marketing cloud. “Vendor neutrality, or the ability to integrate with any data source or activation tool,” Khetan said, “is critical to get the complete view of the customer, but it’s unclear whether the built-in CDP functionality of these marketing cloud ecosystems will play nice with the wider marketing stack.”
John Nash, chief marketing officer for CDP provider Redpoint Global, called the arrival of enterprise CDPs a good thing because any opportunity to provide market education on use cases and technical capabilities is good. Nash believes pure-play CDP providers like Redpoint will be able to do a better job than the enterprise CDP providers getting deeper, more granular customer data that ultimates leads to better personalization opportunities for marketers. “Micro-moments get fed by micro data,” Nash said. “If you don’t have all the data you could have on a customer, it really kind of limits your ability to personalize.”
Related Article: 6 Ways to Improve Your CDP Data Strategy
What Say You, Enterprise CDP?
We caught up with some of the vendors considered by the CDP Institute to be in the class of enterprise CDP about their ability to provide software integrations and how they compare to pure-play CDPs.
Salesforce CDP (Customer 360 Audiences)
Salesforce is the lone enterprise CDP not officially out in the market. It is expected to be released in October, according to Chris O'Hara, VP of product marketing at Salesforce.
What would you get out of this CDP vs. a pure-play provider?
Today’s independent CDPs create just another data silo in large enterprise marketecture, promising data unification but actually offering more fragmentation — and the CRM system remains the most persistent and true "source of truth," O’Hara said. “Most will fade away, or quickly pivot to become applications that fill in the ‘white space’ unoccupied by larger players."
How would you describe your CDP's ability to integrate? Is it offering APIs?
Not only does Customer 360 Audiences support native connectivity to data within the core Salesforce CRM platform and Salesforce Marketing Cloud, it also benefits from substantial investment in ETL data extraction and API infrastructure from acquisitions in Mulesoft (API platform for enterprise data); Audience Studio (Data Management Platform for integration of pseudonymous data); Datorama (ingestion and visualization of media analytics data, with built-in API library and ETL engine); and Evergage (Real-Time Interaction Management platform with built-in library of CMS and other content connectors).
Microsoft Dynamics 365 Customer Insights
Dina Apostolou, senior director of product marketing for business applications at Microsoft, said the Microsoft CDP platform was made generally available in April 2019.
What would you get out of this CDP vs. a pure-play provider?
Apostolou didn't address pure-play providers specifically, but said Dynamics 365 Customer Insights requires minimal configuration, supports data privacy and GDPR compliance using enterprise-ready security and built-in governance tools. It also integrates with Microsoft 365, Dynamics 365, Power Platform and Azure Synapse Analytics.
How would you describe your CDP's ability to integrate? Is it offering APIs?
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Customer Insights includes out-of-the-box connectors for Microsoft and non-Microsoft data sources including third party databases and online services like Salesforce, Google Analytics, Adobe Analytics using prebuilt connectors or extensible connector framework for custom sources. For data stored in an Azure Data Lake (ADL), there are connectors in Azure Data Factory to attach ADL to Customer Insights. Additionally, customers can leverage native integration to Azure Synapse Analytics to combine customer data with financial, operational, IoT and real-time streaming data, or Azure Cognitive Services for unstructured data such as text, images, videos and speech processing. Customers can also benefit from the Microsoft partner ecosystem for development of custom APIs and connectors from partners (like Informatica) to attach enterprise data for processing.
SAS Customer Intelligence 360
Lisa Loftis, product marketing manager for SAS Customer Intelligence, said the company began development of the SAS Customer Intelligence 360 solution in 2015 and the foundation for the CDP capabilities was completed in 2019 with the combination of the hybrid architecture, the external API agent and the streaming data platform.
What would you get out of this CDP vs. a pure-play provider?
SAS Customer Intelligence 360 solution provides not only the core capabilities commonly attributed to the CDP (ingesting audience data from multiple sources, managing customer identities, providing audience segmentation, provisioning customer data to other systems), it also goes well beyond CDP to provide real-time omnichannel journey orchestration and personalization powered by analytics. "Our unique hybrid architecture goes beyond simple data ingestion to provide a comprehensive first-party on-line and off-line data set that provides customer level granularity and completeness for customer activity while also while identifying important personally identifiable information (PII), which should not be captured," Loftis added. She added SAS can collect data from other vendors such as Adobe, Google, Tealium and Salesforce, as well as inject data, events and analytics results into those applications; enhancing the impact of other martech and CDP applications.
How would you describe your CDP's ability to integrate? Is it offering APIs?
SAS provides an extensive API framework to support customer journey orchestration across technologies and channels. It also provides a connector framework so end users can build connections to other systems. "We also provide an external task capability that enables end users to build out integrations with other execution channels to leverage the segmentation done within the CDP," Loftis added. "SAS supports integrations with over 1,000 certified partners."
Adobe Real-Time CDP
Adobe released its Real-Time CDP offering in March of 2019.
What would you get out of this CDP vs. a pure-play provider?
It's the engine that's underneath the CDP that is the differentiator for Adobe, according to Matt Skinner, senior manager of product marketing for Adobe. It supports streaming ingestion so that users have profiles that are up-to-date. The segmentation engine combines event data (website activity) with attribute data (PII data). "It's about being able to combine both of those variables and do things like sequential segmentation," Skinner said. "Being able to run segmentation jobs either in batch for high definition or for streaming segmentation for low latency, to be able to ensure that you're delivering real-time experiences. So I think the engine is what makes our offering more robust than the point solutions."
How would you describe your CDP's ability to integrate? Is it offering APIs?
Adobe makes being open and extensible a key part of its CDP platform, according to Skinner. It includes a number of pre-built integrations out of the box for sources and for destinations. "And those are with organizations that we compete with and other aspects of our business," Skinner said. "But then we also have the ability to export an audience, and then drop it on an SFTP or an FTP or an Amazon S3 so that customers can pick that up and use it as they need."
Oracle CX Unity
CX Unity debuted in October 2018. Des Cahill, GVP of product management for Oracle CX, told CMSWire Oracle calls the platform a “customer intelligence platform to distinguish ourselves from the CDP and the general CDP market. There's a lot of non-enterprise players with sort of more limited offerings.”
What would you get out of this CDP vs. a pure-play provider?
Cahill cited three differentiators from pure-plays: high-fidelity data, personalizing the entire customer journey and real-time customer decisioning and engagement. "We have a greater depth of data," Cahill said. "... We're collecting the entire clickstream. ... And then there's a greater breadth of high fidelity data, meaning we ingest data from marketing, sales, service, commerce, loyalty and even the back office applications like finance or supply chain. ... We're Oracle. We're really good at organizing and analyzing data at scale securely."
How would you describe your CDP's ability to integrate? Is it offering APIs?
Oracle built CX Unity as an open architecture where users can leverage APIs and connectors that either Oracle or systems integrator partners like Accenture and Deloitte Digital built. "We're able to ingest data from any third party system, whether it's cloud or on premise," Cahill said. From there, customers can build a unified customer profile about each customer and it can be used by Oracle systems like Responsys (email marketing) or Eloqua (marketing automation) or it can be used by competitive systems or an in-house system for marketing or service or sales, according to Cahill.
Identifying Customer Use Cases
No matter how you slice and dice the CDP market between enterprise vs. pure play, what still matters most for buyers in selecting such technology is the ability to identify the most important customer use cases, according to Rob Fagnani, VP of strategy at Formation.ai. “This helps paint a vision for success, and working backwards from that vision highlights the key features and functionality of CDPs,” he said. “For example, a company focused on unifying sources of data together from disparate sources should inquire more heavily around the CDPs' capabilities around data integrations, transformation and mapping. On the other hand, a company that already has a decent view of its customers that is looking for customer insights and decisioning will want to understand the suite of data science and analytics tools to understand the depth of insights a CDP platform could create.”
Implementing CDPs and other marketing technology platforms continue to push organizations to be more data-driven, he added. Consequently, enterprises need to evolve the skills of their team members, Fagnani added, to effectively operate these tools and have a clear picture on the value-added services and tasks required to maximize the ROI of a CDP investment.
