Why composable customer data platforms are key to omnichannel excellence

A customer data platform (CDP) is a software program that, as implied by its name, collects first-party customer data from multiple digital sources. Those sources include:

• Online customer behavior—actions taken on a website or other channels like live chat; how frequently they visit and how long they remain
• Customer transactions—what the customer buys from e-commerce or point of sale systems
• Demographics—the customer’s name, age, address, etc.

The goal of a CDP, according to Oracle is “to build a single, coherent, complete view of each customer.” But what other benefits does it bring to brands?

What is a CDP and why do you need one that’s flexible?

A key element of a CDP is that, according to the Institute’s definition, data stored in the CDP “can be used by other systems for analysis and to manage customer interactions.”

The challenge to traditional CDP has been the growth in “other systems” as well as a rise in customer expectations. Then there is the massive accumulation of customer data already stored in siloed data warehouses. All that accumulated data is isolated from the power of the cloud and its ability to discover pathways to marketing destinations where customers visit, spend money, and return to buy more.

Additionally, as we pointed out in a previous blog, the COVID-19 pandemic broke up the “historical inertia” in marketing technology that relied on an integrated suite, “single-truth” approach.

Yes, all-in-one suite solutions “can provide value, but they must be complemented with point solutions that address technology needs specific to the organization.” The one-sized, monolithic approach is broken.

In addition to lack of scalability, as an “all-in-one solution,” traditional CDP has the following weaknesses:

• Traditional CDP is slow to set up and implement.
• As a “shot-gun” approach, it lacks user clarity in its applicability and use.
• As a data model, traditional CDP lacks unity and synchronization with in-house data warehouses and business process automation systems.
• When a CDP suite is connected to existing data sources, it consumes additional IT resources—maintenance, troubleshooting, expertise, staffing, etc.
• Traditional CDP results in data duplication and multiple copies of customer data. This raises data-integrity and other data maintenance problems.
• The additional personal data presents increased security and data privacy risks.
• When maintaining duplicate data—multiple database models—traditional CDP costs more to maintain.
• Traditional, stand-alone CDP is frequently incompatible with the organization’s existing workflow. That incompatibility causes additional work and delayed decisions.

So what is needed is a solution to the monolithic and duplicative customer tracking approach of traditional CDP. That solution is through a composable approach, such as the one taken by Lytics.

“Composable” is the future of business architecture and digital transition technology

The trend in digital transformation, according to Gartner, is towards composable technologies. When applied to CDP, that approach has three building blocks:

1. A thought process that “keeps you from losing your creativity.” How can you leverage customer data in scalable chunks without deep, time-consuming data mining?
2. Building the business architecture so that it is flexible and resilient. Can the business pivot with the times and changing customer demands?
3. Connecting the pieces and parts of your marketing goals and integrating them with your business model. How do those parts interact, and can you use your existing digital strategies for new business discoveries?

The Lytics composable CDP approach

You already have a data warehouse. Why not leverage and build around it? With Lytics, you don’t have to maintain two databases. You can ensure security and privacy through a modular approach, a reverse ETL capacity, and delivery of business-specific personalization.

The Lytics next generation of CDP consists of the following composable tools:

• Lytics Conductor builds omnichannel customer profiles (C360) that unify and aggregate all customer touchpoints from everywhere—and in a private and security data warehouse.
• Leveraging composability into CDP accelerates speed through discovery. With Lytics Cloud Connect you can find those customers in a segmented process with direct queries.
• The Lytics Decision Engine provides real-time customer tracking intelligence for actionable insights, including providing product recommendations—with real-time personalization and customer scoring.

Watch a brief 5-minute demo on our product overview page to see how Lytics can save you 5 cents on every dollar of your current marketing spend.