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March 16, 2020updated 17 Mar 2020 9:05am

The Rise and Rise of the Customer Data Platform: As Cookies Crumble, Why the CDP Matters

"Marketing technology vendors that rely on third-party cookies are slowly going extinct"

By CBR Staff Writer

As a source of customer data, cookies are crumbling, it’s official.

Firefox and Safari already block third-party cookies by default. With Google announcing early this year that it would be ending support for third-party cookies in Chrome by 2022 at the latest, the internet’s dominant browser is set to follow suit. Businesses who have used third-party cookies to track customer journeys increasingly need to think on their feet about their marketing and advertising stacks.

Their challenge is two-fold: many larger brands with strong first-party data (often aggregated with a huge range of third-party data bought in from specialist providers) are already sophisticated at “segment-of-one” marketing – pushing highly personalised campaigns and offers to granular audience segments, some at the individual level.

This is increasingly vital to both campaign and broader business success. Customers expect a personal touch: push granny pants to someone seeking skimpy Calvin Kleins and you’ll lose business fast. Knowing your customer has never been more important.

The privacy demands of GDPR meanwhile mean that these customer profiles have to be constructed without the abuse of personally identifiable information (PII). Pushing those CKs to someone shopping for them, but who has explicitly ruled out being contacted with personalised marketing, could open a nasty legal can of worms.

For the Googles of the world, pulling the plug on third-party cookies (which allow for behavioural profiling by tracking customers across sites in order to understand their interests and habits) is hardly a problem, and indeed, likely thins out competition: such companies can rely on a wealth of first-party data collected from people signing into their own widely used services: think Android, Chrome, Gmail, search, YouTube.

But other businesses are being forced to scramble together first-party data from as many different sources and siloes as possible, and use it to build customer profiles, sans cookies. That’s where the Customer Data Platform (CDP) comes in.

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Designed to pull data from everything from Excel spreadsheets to the myriad SaaS tools most businesses now use, CDPs typically provide data consolidation and processing services to create “unified” customer profiles, then help marketing teams deploy them to boost advertising performance and improve customer stickiness.

BlueConic founder and CEO Bart Heilbron.

One of the more established is BlueConic (although it has no shortage of competitors, including Arm Treasure Data, Exponea, Segment, and Tealium).

Founded in 2010, the Boston, Massachusetts-based CDP provider recently raised $12.8 million in a Series B funding round, and names ING, Hearst Newspapers and T-Mobile as customers.

Computer Business Review joined BlueConic’s CEO and founder Bart Heilbron for a chat about his business, the CDP sector, and the changing face of marketing.

Talk Us Through the Basics of What BlueConic Does…

A lot of brands out there — whether it’s in retail, whether it’s in publishing, whether it’s a travel, whether it’s in telecoms or in finance — are sitting on a lot of data coming in from a lot of different sources, whether that’s traditional CRM systems,  marketing systems, or all kinds of mobile and web data, as well as offline data.

All these different data sources or data streams have bits and pieces of what they know about every individual customer, but often brands lack a way to look at these different bits and pieces of what they see of the customer as one entity.

And that’s why we built our platform BlueConic: to unify all those data sources, into individual level customer profiles; from the very first touch-point, all the way down to frequent interactions. Our customers can then access that data in real-time to increase sales conversion rates, build better customer profiles, and so on.

What Inspired the Launch of Your Business?

Ten years ago people were just looking at digital and online as their website. Then the iPhone launched, Facebook was growing fast, all kinds of social channels came and we could see that customers would be dealing with siloes.

Have you seen the super graphic of marketing technologies? A few years ago it was a couple of thousand; now there are over 7,000 marketing technologies about there. That means that there is a lot of additional data being being captured, which is an opportunity for marketers because they can act on it.

But it’s also a that is also a challenge to orchestrate, particularly given the changing cookie environment. The CDP is taking over as this single hub of customer data to orchestrate all customer interactions, specifically in the marketing domain.

The exponential growth in martech vendors and technologies.

Most of our customers are now competing with the Amazons, the Nikes, the Apples of the world, because those are the brands that set the bar in terms of how personalised customer experience should work. One of the things these brands have figured out is how how to put you as an individual, at the center of their outreach.

And one of the big advantages these brands have had is that they have been able to build up a technology stack from the bottom up; they have been able to put the customer at the center of their technology stack in a unified and a real time matter. But most brands around for 20 or 30 years have a lot of other systems in place, which aren’t built for this particular purpose. That’s where a CDP comes in.

There are a Lot of Good Data Lake and Data Visualisation Software Vendors Out There. Why Pay for More SaaS and not Just Hack Something Together Yourself?

We store it in a more structured way, something that data lakes don’t do. Then we cluster that data around a single customer entity, so the customer is the central object and the is data structured around that customer. That’s that’s one big difference.

The second big difference is the accessibility of that data: it’s not only about storing the data or building visualisations on top of the data so you can look at it in the rear view mirror. This is about being able to access and act on data in real time — because the state of a customer nowadays can change with a single click or a single swipe.

As a business, you need to be able to act on that for every individual customer, at scale.

And that’s something that data lakes or analytics solutions cannot do, because there is always this lag between initial data collection, unification and  activation of the data.

You’re Just Raised $12.5 Million, But You’re In a Competitive Market. What Makes BlueConic’s Customer Data Platform Stand Out?

There are a lot of wannabe CDPs out there, or companies that came from different software categories that sort of latched on to the category and jumped in when the term got popular.

We are also very much focused on the marketer. So we’re not just a technical platform, a normal database of customer data: we allow marketers to actually access the platform with a UI that they can actually use it on a day to day basis, without IT in the middle. That ease-of-use is very, very powerful.

Can You Give Us Some Examples of Customer Use-Cases That Excite You?

Hearst Newspapers, who own a lot of local newspapers, are using it to transform their business. Obviously, as a publisher, their biggest business challenge is that offline newspaper subscriptions have gone down, but online they only [had] a advertising business model that they can leverage, or they need to get people to subscribe to their online channels.

So they [are using] everything they know about their customers, about their interests their topics, to optimise their paywalls in real-time to provide for a more dynamic paywall experience:  they can provide a paywall that is personalised to the topics that people are actually interested in, increasing sign-ups.

Similarly a big car rental car rental company is using the CDP to drive more direct revenue as opposed to relying on online travel agencies. They have been very successful at building a much more direct-to-consumer strategy.

The Martech Market’s Changing Fast. What Do Companies Need to Look Out For on the Horizon?

Marketing technology vendors that rely on third party cookie and third party data or cookies as a thing altogether are slowly getting extinct. The advertising vendors that are purely on the advertising side, that don’t have anything to connect their views and impressions to what’s happening within the walls of the brand, to connect to first party data, will also have a really hard time.

The traditional data management platforms (DMPs) have been basically been replaced by CDPs that have a more direct connection to first party data, where the brand also has a managed form of consent to actually use that data.

What’s Your Plan with the Recent Investment?

It’s all about growth. We’re active in both Europe and the U.S; split almost equally. We want to grow both, boost our data scientist and engineering fields on both ends of of the ocean, doubling our marketing spend. Obviously, the sector is growing fast.

We’ve grown about 3,000 percent since our last round of funding and we want to keep that up over the next couple of years: we want to be the winner coming out of this changing environment for businesses.

See also: “You Gotta Have Courage” – the BP Cloud Migration, Unvarnished



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