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Should You Buy or Build a Customer Data Platform?

Should You Buy or Build a Customer Data Platform?

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The last blog post in this 3-part series may have left you wondering if you should buy or build a customer data platform (CDP). We’ll answer that question in this last installment.

In the first post, we looked at six reasons to implement a CDP. Then in the second blog post, we discussed the five major CDP components.

The five main CDP components are:

  1. Data Ingestion and Storage
  2. Data Modelling and Data Processing
  3. Identity Management and Consent Tracking (for Marketing)
  4. Profile Enrichment and Audience Building
  5. Actions and Insights

We briefly discussed Consent Management as an important part of any CDP marketing use case.

Obtaining a customer data platform can be achieved by purchasing a CDP suite, sometimes called an  off-the-shelf CDP solution, or by selecting the various individual component pieces and using them to build your own customer data platform.  The latter is known as a composable CDP solution.

Assembling a CDP team

In either case, CDP implementations need people with deep expertise and knowledge of data architecture, data modeling, and data engineering.  These skills are needed to achieve data ingestion of internal and external sources into a data storage repository in a well-architected way that is both scalable and cost-effective.  For composable CDP solutions, it is critical that the team construct a workable plan that incorporates how each of the pieces will be combined.

Platform Expert

Beyond that, it’s important to have tool or platform-specific knowledge to build out the capabilities of the various components of the selected customer data platform.  For example, it would be beneficial to have Salesforce Administrator skills to assist with the Salesforce Data Cloud implementation and administration of the Data Cloud afterward.  

Marketing Operations

It’s also important to have marketing domain expertise, especially for use cases that involve audience building for marketing purposes.  Not all CDP use cases involve the marketing function, but there are a significant number that do involve marketing use cases.  

Advanced Technical Experts

No matter whether you choose to buy or build a CDP, there’s a variety of skills needed to get up and running on a customer data platform, so it’s likely going to take several different people, each with varied skills.  

How to fill the skill gaps

Large enterprises that employ a big IT department experienced at building applications or SaaS companies of any size where the core business is building applications, are more likely to consider composable CDPs as an option.  And organizations with use cases that require real-time capabilities will need to carefully consider whether an off-the-shelf CDP solution will provide the needed functionality.

That said, the quickest way to get up and running on a customer data platform is usually by purchasing a CDP suite that includes all the major components ready to go out-of-the-box.  In addition to accelerating the time to value, a customer data platform suite is a great choice when your organization lacks the IT support and skills needed to evaluate, select and piece together all the various components of a CDP.  

Salesforce as a CDP suite

Choosing Salesforce as the CDP suite to buy is pretty straightforward if you already have Salesforce Sales and Service cloud, or an industry equivalent such as Salesforce Nonprofit Cloud or Health Cloud, and/or Salesforce Commerce Cloud.  

Those Salesforce platforms have a direct connection to the Salesforce Data Cloud as well as a connector to the Salesforce Marketing Cloud.  This removes the need to build pipelines between these systems as would be needed for a composable CDP solution.  As a result, security is ensured by Salesforce because all data is contained within the Salesforce system. 

Considerations for composable (build-your-own) CDP solutions 

Composable CDP solutions are an option to consider if your first-party data doesn’t live in a CRM like Salesforce and your IT team has the skills, experience, and bandwidth to build out a solution for the organization. Composable CDP solutions are a great choice if your organization already has some of the five major CDP components installed and working well.  

If your first-party data is already ingested into your data warehouse or data lakehouse, is being processed and transformed, and you have robust machine learning tools in place, then your existing system likely meets several of the CDP requirements already.  In that case, it might make sense to just add the missing pieces to your existing platform rather than purchase a CDP suite.

Steps to decide if you should buy or build a customer data platform (CDP)

There is a lot to consider when making a CDP choice.  Both CDP suites and composable CDP solutions are viable options but to help you figure out which one might be a better choice for you and your organization, here are four things you can do.

1. Define your CDP use cases and know what problems you need to solve

For what purposes do you want to use unified customer data?  Do your use cases need to be solved for only marketing concerns or will the sales and service teams benefit from a unified customer profile?  Do any of these use cases require real-time capabilities? 

2. Evaluate the current gap in your CDP requirements

Where does your current first-party data reside today?  Of the given CDP components you need, how many does your organization already have in place?  Are there any digital transformations or architectural upgrades planned in your organization for the next 12-15 months that you are aware of and should consider?

3. Consider your internal teams’ skill sets, experience, and bandwidth

Does your IT team have the skills and experience to select the right pieces and compose a CDP from different vendors?  Will your IT team be able to prioritize building a CDP over other internal projects?

4. Review vendors’ track record and consider the likelihood they’ll continue investing in the product

What is the vendor(s) track record in the CDP space?  Are they new to the modern marketing tech stack or have they been in the CDP space for quite a while and perhaps considered to be more of a legacy product?  How likely are they to continue investing in their product(s).  

Consider your long-term plan when making a CDP build or buy decision

Customer data platforms are a long-term investment — you want to know your CDP vendor(s) will continue to improve their product.  And you’ll want to make sure you’re setting your team up for success by considering the level of effort needed to administer and support the tool and platform choices for your CDP.  

Whether you choose to acquire an off-the-shelf CDP suite or build a composable CDP, there are many reasons why your organization would want a customer data platform.

Remember to reach out to the team at Sercante for guidance when you’re ready to implement a CDP at your company or organization.

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  • Joyce Avila has a diverse work experience spanning over several industries and roles. Joyce currently holds the position of Program Lead, Data Cloud at Sercante.

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