Last updated: Why customer profiling is valuable for your business | CDPs can help

Why customer profiling is valuable for your business | CDPs can help

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Customer data platforms (CDPs) have been on the market for nearly a decade. Yet many enterprises still don’t realize the benefits they can expect from this solution. In this post, we’ll discuss how CDPs build and manage unified customer profiles and contextual profiles. Also, by creating a customer profile strategy and identifying customer profiling methods, we’ll explore how customer profiling can differentiate your business. As well as the outcomes you can expect from this strategy.

Why unified data and contextualized insights are mission-critical to customer profiling methods

The value of customer profiles is that they offer insights accessible across an enterprise to facilitate the creation of multi-faceted, continuously customer-centric experiences at every touchpoint. Customers become the central point of every decision and they can feel that in their experiences, regardless of department, platform, or stage of their journey through an omnichannel experience.

Departments in an enterprise may have the same end goal, but data gaps often prevent a connected, consistent customer experience. Marketing will create a campaign and hand it off to the sales team, but they won’t have visibility into how it performed. A customer will call customer service to ask about a marketing promotion. But the customer service rep has no insight into what promotion the customer received from marketing. In-store customer loyalty programs aren’t integrated with a customer’s online profile and their rewards don’t transfer. The list of fragmented experiences between customer touchpoints continues with a lack of customer profiling in a unified way resulting in insight loss and poor experience

How customer profiling creates happier customers

Customer profiling creates happier customers by unifying and contextualizing customer data, keeping brands in step with customer needs, desires, and pain points.

As a consumer, my expectation is that you know who I am. I can trust you with my information, and you know about all my previous interactions whenever I engage with you. For instance, I assume customer service knows about the product I ordered. They recognize the promotion I’m referring to without me having to provide context.

Yet, most organizations’ customer-facing systems are stitched together. They can’t keep up with the volume, velocity, or variety of data to create a seamless experience for customers.

So, what’s the solution? Unification and contextualization. This means:

  1. Integrate a pre-built platform that centralizes all customer data from all customer-facing systems. It assigns all the data correctly to the appropriate customer and fuels all other customer-facing systems with this repository of data.
  2. Contextualize the data in a way that allows the company to easily utilize the data depending on the purpose. The goal: the right data, right person, at the right time, in the right way.

Create positive experiences through unified profiles

A happy customer is typically a loyal, returning customer. From a brand’s point of view, it’s even better when a happy customer is an advocate who brings in new customers. But ultimately individual customers own their experiences with the brand. You can’t control their emotions or perceptions. But using different customer profiling methods you can create the most optimal environment to delight your customers. That’s where a CDP comes in.

The kitchen sink: A unified customer profile in your customer profile strategy

Initially, your customer profile strategy might consist of gathering every piece of first party, second party, and third party data from your customers. Then it assigns, organizes, and stores the data. Data collection from the following sources may look like this:

SOURCE

EXAMPLE

Online

Behavioral data, registrations, log-ins, and social media activity (likes and shares)

Offline

In-store activity, in-person events

Back-Office

Supply-chain and ERP data

CRM

Transactions and interactions with your sales and service team

A CDP collects all the customer data across an organization, unifies it through a common data model, and creates unified customer profiles. These profiles create a holistic view of the customer for a brand.

Yet because of the volume of data an enterprise can house in these profiles, issues may arise when an enterprise tries to use or activate the data. Creating a customer profile strategy that takes into account the different desired actions for a customer to take, allows you to engage the CDP to collect actionable data—quality is stronger than quantity.

Contextualization: level up with data for a purpose

What if your business users didn’t get the entire kitchen sink when they need context for an engagement? What if you had a solution that provided trusted, accurate, and relevant customer data in real-time?

A customer service rep will typically need very specific information regarding a specific interaction within a customer journey. Marketing teams, however, may prefer a high-level overview to help segment and create relevant offers based on activities and behaviors. There are ways to use customer profiling methods that will benefit multiple departments and objectives.

Thanks to a new wave of CDP innovation, you can fuel any engagement system with the appropriate customer data relevant to the context of the engagement. Activating the right data at the right time results in a consistent omnichannel customer experience. What’s more, a CDP can do this at scale. It can provide the foundation for hyper-personalized experiences according to the customer’s needs, rather than pre-defined, and often irrelevant, journeys.

Benefits of a CDP

When a CDP offers both unified customer profiles and contextual profiles,  then your enterprise can realize the following benefits. Look at these four incredible benefits of a CDP.

  1. A dynamic customer data foundation—By ingesting and unifying data sources into comprehensive customer profiles, you create an accurate, trusted foundation for flexible, real-time, relevant experiences.
  2. Reduced regulatory risk—Through enhanced governance, a CDP can honor the purpose of the customer data you collect and process. This helps build trust with customers and addresses requirements in an increasingly complex regulatory landscape.
  3. Lower costs—Time is money. A contextual profile view of customer information relevant to the data’s purpose allows you to act efficiently while reducing cost and resource strain.
  4. Increased retention to increased revenue—Fueling engagements across the front office with rich context builds strong customer relationships by creating consistent, hyper-personalized experiences for your customer at scale.

Bring cohesion to your tech stack with customer data platform

A CDP represents a foundational approach to data unification and data utilization based on context. When your service rep tries to resolve a customer complaint, they shouldn’t scroll through endless amounts of data or toggle between different platforms to find the resolution. The flexibility of CDP allows them to access data from the customer profiling methods that were designed in the CDP to create the most robust customer profile.

With unified profile and contextual profile views, you can enable your employees to deliver seamless, hyper-personalized experiences that are unique and relevant to your customers. In addition, you’ll give your business users customer data in the right context, rather than the full repository of customer history all at once.

Do you really know your customer? Find out how a CDP uncovers the insight you need to power CX that drives growth. Start HERE.

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