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Finding ROI from CDPs

Takeaways from the series on personalized marketing solutions that CDPs deliver

Look, if it doesn’t make you more money or if it doesn’t get you more customers, then what’s the point? I decided to close this series with a return on your CDP investment. So far, I have shared different use cases that encompass personalization enabled by a CDP, like VIEWN’s. It is important to talk about the return of investment that you can get from these personalization solutions.

I tend to think of an investment in CDP technology as more than just an IT investment, but rather an investment in customer-centric and customer experience (CX). And investments in CX are definitely nothing new but still have a ton of room for improvement. In fact, a spring 2020 survey conducted by User Testing found that 95% of executives report that CX is important. Still, only a third of employees surveyed said that their organization has a proactive approach to CX. So many organizations are just reacting to the market rather than leading it. What is causing the discrepancy? The survey says that only 50% of respondents were empowered to use customer insights to inform decision-making. They need a CDP. Getting the data together to build empathy with your customer is what’s missing. This is where a CDP fills in the gap- getting the data ready for insights.

Increasing revenue with personalization

While marketing departments may only still be scratching the surface in terms of the benefits Marketing Personalization brings. Technology innovation like CDPs is allowing marketers to get closer. Most customers are responding to personalization tactics now, only purchasing when a pleasant customer experience accompanies it. Deeply understanding the customer relationships your brand has cultivated is the point of marketing. Building relationships implies multiple interactions with your brand over time.

Personalizing more of these interactions with tactics along the customer journey can pay off with greater customer satisfaction, increased retention, and strong brand loyalty. In researching the topic, I found case studies siting results in a 200% increase in revenue. Others claim projects that delivered a 3X increase in customer acquisition.

At VIEWN, we have narrowed our focus on segmented customer data to accelerate customer acquisition and target underserved segments while even throttling over-engaged segments. Because we look at many digital journeys, % Increase in Conversion and Time to Close are both closely evaluated as you can start measuring things and look for immediate insights. Conversion rates and speed to close are both revenue measurements that can be optimized with real-time tactics. We move the needle by increasing Revenue per Customer from segmentation by providing customer insights regarding cross-selling and retargeting. Engagement scores and NPS are measures to get referrals and prevent churn, which also drives up revenue.

Controlling advertising effectiveness

Given the current economic headwinds, all marketers are looking at costs. Ad budgets are being modified because messaging needs tweaking to reflect the times. More medium-term KPIs to look at when justifying expenses are Efficiency in Ad Spend and Advertising Budget Spread across valued segments.

Our goals are to keep low customer acquisition costs with more relevant targeted ads and higher Ad conversions, also known as ROAS. Re-distribute Ad spend across a greater section of segments can be a useful tactic when looking to reach more audiences to grow.

The clearest and least debated way to look at your Return on Investment is baselining and comparing campaigns and how much you spent on Ads to grow your customer base. For example, for Project A, you spent $250 weeks on Ads to get 100 new customers. For Project B, you spent $250 on Ads and brought in 200 more customers. Project B does twice as better. It doesn't hurt to keep it simple while getting answers quickly.

Return on CDP Investments

For years selling enterprise software and cloud solutions, IT value propositions focused on speed to insights and data crunching duration. And while they were measurable benefits of IT, they often fell short in bridging the greater business's benefits. As both a consultant selling solutions and a product manager producing solutions, I found this gap causes so much internal debate between departments on what’s really working. When trying to quantify CDP returns, my recommendation is to focus on the solution value rather than the technological value.

Launching VIEWN has me learning a lot about describing sales values in Better, Faster, Cheaper. And I’ve been trying to tie the KPIs and growth metrics to these sales values. As no CDPs are built the same, how easy it is to get these returns varies. But it helps to make sure you know what you are going after with every program and initiative. Since the series is about solutions unlocked from CDPs, the KPIs need to be about the value they bring. Here is a list of measurables by type.


Increases Revenue

Increases Customer Satisfactions

Drives Up NPS

Healthy Engagement Scores

CDPs makes money FASTER:

Increases Revenue per Customer

Increased Sales Conversion Rates

More targeted segments

Increased Digital Interactions

CDPs make marketing CHEAPER:

Strong Return on Ad Spend (ROAS)

Increased Sales Conversion Rates

Increased Digital Interactions

Higher Customer Retention Rates

Lower Customer Churn

Solutions unlocked from CDPs. The KPIs need to be about the solution value they bring. You can get an outstanding return from Customer Segmentation, Engagement Scores, and Customer Journeys Analytics. I have even noted metrics that don't take forever to get insights. These solutions drive marketing personalization and are unlocked by new CDP technology that unified the data from different apps and puts them into profiles to be sliced and diced into insights that drive customer experience. This is an exciting time to be a marketing technologist.


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