If you look at the vision of a DMP, it was about “data management,” but it was that we were talking about customer data. I guess if you dove a little deeper, the DMP was about prospects more than customers, but customers were included.
The CDP space feels like the evolution of that customer-oriented data story, and while I find it eerily similar, I do understand there are nuances.
I’m a marketer and I know that at scale, or specifically in larger enterprise organizations, customer data rests in multiple databases and silos. This is especially true when large enterprise companies grow through acquisitions and customer data resides in legacy data management systems. Some companies are marketing-centric and the customer data lives in marketing platforms. Some are product-centric and that data lives in a more traditional data warehouse or other structure.
The DMP existed to activate the data for marketing purposes, no matter where it lived.
The CDP is an evolution because it enables you to unify the data, then make it available to other platforms. It’s like the core component of a DMP, expanded and strengthened to be more robust.
The DMP space was flying high a few years ago, but many companies have either changed or modified their usage of a DMP and some have transitioned to the CDP. It's trading one acronym for another, but in this case I do understand why.
The CDP also enables you to engage better in sales motions. This works especially well in SaaS with no-, low- and high-touch sales motions. Too often, large companies have that data in different databases, different CRM instances, etc. The idea of moving and shifting all that data into a single database is hard, so you can theoretically build a CDP that reconciles with those databases and gives you a single source of truth around your customers. When you do that, you have the ability to de-dupe databases and activate on a single, consistent, aligned view of your customer.
That feeds things like nurtures, upsell motions and cross-sell motions. These are all requirements of a true SaaS business. I’ve spoken to a number of CMOs from different Fortune 500 companies and almost all of them have these same issues. They all understand the concept of a CDP, and only a few have pulled the trigger on implementation at this point.
What makes it hard to determine the future of the CDP is the future of the cookie and digital tracking. As the walled gardens become the only true place where data can be leveraged (because it is still considered first-party data), the question comes down to whether you want to activate your data on their platforms, essentially giving them access to your data. It also stands to question whether your expenses associated with the CDP will be warranted. Those are questions that have to be answered internally in your organization, but they are all worth asking.
For now, DMPs have morphed into CDPs and I can see why. I wonder what acronym will come next? What will the CDP evolved into over the next 10 years?