Customer Data Platform (CDP)
A Customer Data Platform (CDP) is packaged software that collects customer data from many sources, unifies it into persistent profiles, and makes that data available to other systems for analytics, activation, and personalization.
Analysts describe CDPs as technology that unifies first-party data from marketing and non-marketing channels to improve modeling, targeting, and timing of messages and offers.
Why It Matters
Single source of truth: Breaks data silos and gives teams a consistent, person-level view.
Better activation: Unified profiles power real-time personalization and smarter journeys across ads, email, web, and apps.
Privacy & governance: Modern CDPs help honor user consent and transmit privacy signals across the adtech stack (e.g., IAB Tech Lab’s GPP).
Faster time to value: Prebuilt connectors and packaged capabilities mean you don’t have to “build it all yourself.” (A common buy-vs-build decision.)
Examples
Retail & D2C: Merge e-commerce, POS, and email data to trigger “back-in-stock” alerts or VIP perks.
SaaS/Product-led: Combine product usage, CRM, and billing to nudge at-risk users or upsell power users.
B2B: Unify contacts and accounts, map buying groups, and route qualified accounts to sales.
Best Practices
Start with clear use cases (e.g., churn reduction, LTV growth, cross-sell) before selecting tools.
Prioritize first-party data and identity resolution (deterministic where possible; probabilistic where needed).
Govern consent & preferences end-to-end; pass privacy signals to activation partners (e.g., via IAB Tech Lab GPP).
Design for activation: Ensure the CDP can push audiences and events to your ad, email, and on-site tools in real time.
Measure impact: Tie CDP use cases to KPIs like incremental revenue, CAC/LTV, churn, and campaign efficiency.
Related Terms
CRM: System of record for sales/customer interactions; not built to unify multi-source event data.
DMP: Audience building from (often) third-party cookies for ads; typically short-lived, pseudonymous data vs. persistent profiles in a CDP.
Data Warehouse / Lake / Lakehouse: Storage/compute layers often paired with a CDP for modeling at scale.
FAQs
Q1. CDP vs. CRM vs. DMP — what’s the difference?
CDP: Unifies multi-source first-party data into persistent profiles and activates them across channels.
CRM: Tracks known contacts/opportunities for sales and service.
DMP: Builds ad audiences (historically with third-party cookies) and stores data short-term.
Q2. Do I need a CDP if I already have a data warehouse?
Warehouses store and process data; a CDP packages collection, identity stitching, consent handling, and activation to downstream tools. Many teams run them together.
Q3. Is a CDP only for B2C?
No. B2B CDPs unify contacts, accounts, and buying groups to drive account-based marketing and sales activation.
Q4. How does a CDP help with privacy?
By centralizing consent, honoring opt-outs, and propagating privacy signals across partners (e.g., through IAB Tech Lab’s GPP and related standards).
Q5. Buy or build?Building offers control but requires major engineering; packaged CDPs speed deployment and provide connectors, governance, and UI for marketers. Evaluate against your use cases.