Building on its commitment to drive positive change through its data and insights, Refinitiv today announced the expansion of its economic data coverage of Africa.

In today’s digital world, data-driven customer analytics have become the heartbeat of modern businesses. Customers are engaging with businesses through digital channels while innovative technology allows the tracking of online activity, giving businesses access to more customer insights. So, how can businesses manage all the data at their disposal?

Data management platforms (DMPs), customer relationship management (CRM) systems, and customer data platforms (CDPs) can all play an important part in the customer lifecycle, but telling the difference between them can get tricky. Let’s have a look at what they do, how they differ and what they can do for each business.

What is a data management platform?

DMPs gather and categorise data from various sources. This information is usually gained from third-party web analytics, such as cookies and IP addresses that track your page visits or even the contents of your shopping cart. Data from a DMP can then be fed into a demand-side platform (DSP) so that companies can serve customers adverts based on their online behaviour.

Legislation regarding user privacy affects how companies can use DMPs. For instance, Europe’s General Data Protection Regulation (GDPR) and South Africa’s Protection of Public Information Act require data to be anonymous and short-lived. Kenya’s Data Protection Act of 2019 was modelled on the principles found in the GDPR, and it gives people whose data is collected many rights, including the right to be informed about what the data is going to be used for, and the right to access this data.

These regulations may make third-party data collection and storage via DMPs much more difficult, and in some cases, illegal. DMPs also don’t provide the same information as standalone analytical tools. They lack a complete view of your customers, which is where CRM and CDP systems become necessary.

What is customer relationship management?

CRM systems aim to improve business relationships by managing interactions with existing and potential customers. They create a simple interface for employees to record basic customer information, such as email, contact numbers, or call conversations, as well as other important details, such as the customer’s buying prospects, contract status, or reasons for a won or lost deal.

CRM systems help businesses learn more about their customers, organise their information, and optimise their interactions. CRM is useful for operations in marketing, sales, and service, as you frequently use past customer data to contact new or returning customers. CRM can serve as an analytical tool to create a sales pipeline for forecasting and improving customer satisfaction. It also helps with creating personalised experiences based on past interactions.

A common drawback of a CRM system, however, is that it often creates a limited view of the customer as it focuses on first-hand interactions and isn’t able to fully integrate data from different touchpoints. Because it also usually relies on manual entry, it can easily become overly complicated, labour-intensive, and difficult to manage effectively. That is where CDPs step in.

What is a customer data platform?

The main problem with customer data is that it is often siloed across different software systems and, while businesses have access to ever-increasing amounts of user data, the core of their business remains digitally unintegrated.

A CDP brings together data from various channels and sources to create a single, unified profile of each individual customer. CDPs work with first-party data, such as a CRM database of existing customers, combining them with second-party data (which is data bought from other companies) and anonymous third-party data (such as those gained by DMPs). This greatly benefits personalisation marketing strategies as it gives a more holistic understanding of known customers while incorporating second- and third-party insights to target prospective customers more effectively.

Businesses should be careful of platforms that have recently changed into CDPs but are, in reality, just CRMs, DMPs, or data warehouses. CDPs do not simply store information or route them between different systems, but they create a central database where information is organised, integrated, and made available to use when it is needed. Bringing all your customer data together is one thing, but you’ll need a trusted CDP if you want to use it well.

A leading CDP provider like www.CM.com (https://bit.ly/2PPSHiy) allows you to segment customer data based on certain criteria. It gives you real-time insights into your customer’s behaviour, so advertising can be personalised and automated with workflows to reach customers via various channels exactly when they’re looking for it. Find out how you can unlock your customer data with www.CM.com’s CDP (https://bit.ly/2PPSHiy).

How they all come together

DMPs, CRMs, and CDPs all come together to create a bigger picture of the customer journey. After DMPs have created new customer leads, CRMs keep track of the on-going relationship while CDPs bring all of this data together to help brands connect and engage with new and existing customers more effectively. Businesses don’t always need to choose one over the other; they all serve valuable roles in understanding your customer and aligning your marketing campaigns with data-driven insights.

As more people take to online activities, the amount of user data being generated will only increase. If businesses want more effective customer engagement and satisfaction, they need to start using that data to its full potential.