Table of contents
What is CRM?
For brands today, one of the most important goals is capturing data gleaned from one-on-one customer interactions and leveraging this immense amount of raw and disconnected data to deliver timely, relevant, and personalized customer experiences. Consequently, CRM software is now considered a martech stack essential.
A CRM continuously captures, centralizes, organizes, and makes available customer interaction and transaction data, so that it can be used to achieve key objectives such as identifying new sales opportunities, managing marketing campaigns, and recording, tracking, analyzing, and resolving customer service issues.
This latter objective is a relatively more recent application of CRM platforms, which since being introduced in the 1980s have primarily been used to support sales and marketing functions. Salesforce, the world’s largest CRM provider, describes the evolution of CRMs this way:
Though CRM systems have traditionally been used as sales and marketing tools, customer support is a rising segment of CRM and a critical piece in managing a holistic customer relationship. Today’s customer might raise an issue in one channel and then switch to email or telephone to resolve it in private.
A CRM platform lets you manage the inquiry across channels without losing track, and gives sales, service, and marketing a single view of the customer to inform their activities.
The ability to connect these three functions, and the teams that deliver them, on one platform and with one view to the customer, is invaluable for delivering relevant, connected experiences that build customer loyalty and improve retention.
How is a CRM used?
While different CRM platforms and providers offer various features, at a basic level they are typically used to support the following core operations:
- Contact management: Capturing updated information about customers (e.g., contact details, correspondence, conversation notes or recordings), and making it available to all relevant teams.
- Lead management: Tracking pipeline activities, tasks, and targets across the entire customer journey, from initial customer engagement through to a transaction.
- Sales forecasting: Using data to improve visibility across pipelines, more accurately score and qualify leads, see how close to reaching their targets, and generating reports to manage and motivate sales teams and individual performers.
- Instant messaging: Enabling colleagues — regardless of whether they are co-located at the corporate office or are working on different sides of the world in their respective home offices — dialogue in efficient manner that (if done properly) complements the day-to-day sales processes vs. distracts from it. For example, consider a sales representative having a phone conversation with a customer.
Things are going well, and the skilled salesperson is checking all the right boxes: demonstrating active listening, building rapport, establishing trust, and fostering a relationship. So far, so good. However, the customer asks a highly technical question that the sales representative cannot answer.
Instead of putting the customer on hold — which could impede momentum or perhaps even end the engagement — in real-time the sales representative sends her colleague an instant message, and in seconds receives the information she needs to pass along to the impressed customer.
- Email tracking and integration: Syncing email clients to give sales teams (as well as other relevant stakeholders like marketing and support teams) a full view of customers, contacts, calendars and leads — and all without having to log into different systems. Everything can be viewed and managed through a single, familiar workflow.
- File and content sharing: Uploading assets (e.g., proposals, presentations, quotes, etc.,) to a central location, so that they can be accessed and edited by different teams regardless of where or when they are working.
- Dashboard-based analytics: Aggregating and displaying data in a dashboard, which can be customized to support the information needs of different teams and individuals. For example, sales representatives will typically want rapid access to data such as lead scores and updated contact information, while marketing teams are interested in campaign performance, and support teams want to know about service issues and their associated status (new, open, escalated, resolved, etc.).
Before shifting the spotlight over to CDPs, we should highlight that some CRM platforms support advanced operations, such as integration with marketing automation and customer service systems.
However, all platforms worthy of the label CRM in the global marketplace — which is currently valued at USD $58.82 billion and projected to climb 13.8% by 2030 — will do all of the above (though several will do more, and some will do much more).
What is a CDP?
Sales teams aren’t the only ones that need a practical and reliable way to turn an enormous amount of raw information into actionable intelligence that drives faster, better decision-making.
Marketing teams can be overrun and overwhelmed with customer and campaign data; especially since the modern customer journey map is not short and static – rather, it is complex, often resulting in data silos. Fortunately, there is a powerful solution that turns chaos into clarity - the CDP.
In essence, a CDP captures customer behavior information — known in the marketing world as “digital signals” — across various channels and touchpoints. This data is then used to provide an in-depth, 360-degree view of customers (through various processes like data integration, data cleansing, identity resolution, and segmentation), to deliver personalized omnichannel experiences.
The Customer Data Platform Institute defines a CDP as “packaged software that creates a persistent, unified customer database that is accessible to other systems." Let us unpack the key elements of this definition:
- "Packaged software": A CDP is a prebuilt system, which means that implementation does not require the advanced technical skill, time, cost, and risk acceptance of a typical data warehouse project. With this in mind, some technical assistance is usually required to meet specific organizational requirements (e.g., automated workflows, access levels, compliance, etc.).
- "Creates a persistent, unified customer database": A CDP establishes a comprehensive view of each customer by capturing data from various systems, associating data related to the same customer, and storing data to track behavior over time. A CDP also supports personal identifiers used to target personalized marketing messages and track individual-level marketing results.
- "Accessible to other systems": Data stored in a CDP can be used by other systems in the environment for analysis, and to manage and enhance customer interactions.
How is a CDP used?
As with CRM platforms, there are a wide assortment of CDP platforms available in the marketplace ranging from relatively basic to highly sophisticated. On a fundamental level, a CDP is used to support the following core functions:
- Data collection: Removing silos, the CDP collects data from various systems in the environment — such as CRM platforms, email service providers (ESPs), data management platforms (DMPs), and point of sales (POS) systems — via interactive APIs, batch, and stream.
- Profile unification: Creating individual customer profiles by “scrubbing” data (i.e., fixing incorrect, incomplete, duplicate or otherwise erroneous data in a data set), and linking multiple devices to a single individual.
- Segmentation: Dividing a large, diverse target audience into smaller, functional categories whose members share certain traits, characteristics, and details.
- Decisioning: Using rules and predictive analytics to identify four types of relevance: the most relevant customers to engage, the most relevant topics to cover, the most relevant channels to use, and the most relevant time/day to interact. Advanced CDPs also leverage AI and machine learning to make decisioning manageable and effective.
- Orchestration: Identifying and executing the next-best action(s) determined by the decisioning engine (as discussed above). This is essential for creating seamless omnichannel experiences as customers travel along the customer journey.
- Activation: Sending customer segments to engagement tools, to launch and direct email campaigns, mobile messaging, and social media campaigns.
What are the differences between CRM and CDP?
This is one of the key areas where artificial intelligence and machine learning dovetail seamlessly with the goals of many marketing teams. The need for data-driven decision-making has grown considerably in the last several years, and the path to becoming a data-driven organization has been steeper and rockier than many organizations may have expected. Having the data is one thing – analyzing it and making it actionable is another.
Data has always been key to analytics analysis in marketing. For AI technologies to be effective, they require large amounts of data. So it’s no wonder that they are useful for extracting key insights, metrics, and trends for brands. When AI is combined with business intelligence, brands can gain a more comprehensive view of their ecosystems, trends in the market, and customer behavior.
AI can also automate processes, freeing teams to dive into the results of their initiatives, make strategic decisions more quickly, and build longer-lasting relationships with their customers by providing value in exchange for customer data.
- Primarily focused on managing interactions and relationships with customers.
- More transactional in nature and may not provide the same level of data integration and unification as CDPs.
- Consolidates and unifies customer data from various sources (typically first-party data), thereby creating a comprehensive and up-to-date customer profile.
- Data collection includes contact information, as well as behavioral data, transaction history, and preferences.
- Primary focus on collecting and organizing data related to customer interactions that occur within the organization.
- While CRMs may include data from emails, phone calls, and in-person meetings, they often lack the capability to incorporate data from external sources such as social media or third-party databases.
- Excel at ingesting data from a wide range of sources, both online and offline, such as website interactions, mobile app usage, social media engagement, email interactions, point-of-sale transactions, etc.
- Capable of integrating structured and unstructured data from diverse touchpoints to create a comprehensive customer profile.
- Primarily used for managing customer interactions and relationships.
- Essential for sales and (more recently) customer service teams, helping them track metrics such as leads, deals, and customer support tickets.
- Facilitate communication and collaboration among team members, ensuring that customer inquiries and issues are addressed promptly.
- Geared toward data-driven marketing and personalization efforts.
- Empower brands to create highly-targeted and personalized marketing campaigns based on granular customer insights.
- Instrumental in optimizing the customer journey, improving conversion rates, and driving personalized experiences.
- Primarily focus on integrating with other business applications.
- Can also integrate with marketing automation tools, email marketing platforms, and customer service software to streamline workflow and provide a centralized view of customer interactions within the organization.
- Designed to seamlessly integrate data from various sources.
- CDP functionality can be extended through a wide range of pre-built connectors and apps. These are built in conjunction with third parties to ensure rapid implementation without triggering compatibility or information security problems.
Providing customers with a personalized experience throughout the customer journey — and across devices, channels, and touchpoints — is not merely important: in the big picture and long run, it can be the pivotal difference between thriving and struggling.
In different but complementary ways, CRM platforms and CDPs empower brands to fulfil the promise and potential of personalization — essential for optimizing customer experience, driving competitive advantage, and increasing the bottom line.
Sitecore CDP connects data for relevant and holistic customer experiences that turbocharge conversions and revenue. Key features and functionality include:
- Customer data collection: Capture every click, search, tap, and buying signal from every channel for actionable insights.
- Real-time data, real-time context: Understand the context of each interaction and tailor customer experience (CX).
- Intelligent data lakes: Access pageviews, searches, transactions, and other customer events — all optimized for visual insights, exports, BI streams, and AI model training.
- First-party data unlocked: Drive personalized engagement across ecosystems — without compromising on privacy.
- Connect to activate: Ingest data from SCV, CRM, ESP, DMP, POS, and more via stream, batch, and interactive APIs.
- Real-time segmentation: Target segments as audiences across the ecosystem to drive conversions.
Explore the Sitecore CDP-Salesforce Connector
Sitecore CDP integrates seamlessly with Salesforce, which is the world’s leading CRM platform. The Sitecore CDP connector passes identifying customer information — such as email address or hashed IDs — over to Salesforce Marketing Cloud’s personalization ecosystem. This enables Salesforce Marketing Cloud to leverage Sitecore CDP’s rich customer segments for its Journey Builder, Audience Builder, Personalization Builder, Content Builder, and Analytics Builder.
Learn more about the Sitecore CDP Salesforce Marketing Cloud (SFMC) connector.