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Martech CDP & DXP Explained In Plain English

Kaiiax MarTech
December 12, 2022

According to the Gartner 2022 report, marketers and agencies spend a quarter of their budget on marketing technology. If you’re looking to digitize your marketing, you might be considering to add a few tools to your marketing tech stack. 

But as there are many products on the market, it’s easy to get confused with different types of martech software. To clear things up for you, we are going to explain the differences between a customer data platform (CDP) and a digital experience platform (DXP) and describe their common use cases. 

What is a customer data platform (CDP)

A customer data platform is a software tool used by marketers to collect data from different tools and create a single customer database. CDP integrates with other marketing platforms and systems and receives data from them. 

To be more illustrative, we recommend you watch this demo of Segment - one of the most popular CDPs available in the market. 

When you need CDP

The overall goal of using a customer data platform is to help marketers understand their target audience better and reach out to them more effectively. Here are the cases when a CDP can be a good fit for your business. 

  • You want to collect comprehensive customer data and understand them better
  • You want to get more insights into customer behavior 
  • You plan to use more personalized messages and content
  • You plan to reduce the manual tasks related to data processing

How CDP can make your marketing more personalized

The main task of CDP is to help your marketing team create an exhaustive image of the company’s customers. Here’s how this tool works to achieve it.

  • They integrate with multiple marketing tools (like CRM, email platforms, and social media tools) and obtain data from these sources.
  • Then, based on the collected data, the tool tracks similarities and differences in the behavior of different customers. A CDP unifies similar user behavior patterns and characteristics into “customer profiles”. The goal of creating profiles is to give a better understanding of the audiences your business is trying to target.
  • CDP lets you segment the audience according to different attributes (age, gender, loyalty level) and events (visiting your website, making a purchase, viewing your ads). It can also generate AI-powered insights on how your customers may interact with different content types. 
  • Customer data platforms can also share data with other tools. You can choose which data is important to synchronize and which is not to avoid overlaps and process only relevant information about your customers. 

What is a digital experience platform (DXP)

A digital experience platform is a suite of tools that aims to provide a better multi-channel experience for customers. DXP gathers data from different tools and touchpoints for you and your team to analyze how your audience engages with different types of content across marketing channels. Using a DXP, you can fully control your content distribution through various channels within a single dashboard. 

When you need DXP

Managing a company’s marketing activities means constantly creating and distributing content across multiple channels (websites, ads, emails, social media, and so on). And it’s important to organize content creation and monitor how customers interact with it. Still, managing different channels through separate tools might become a mess for your marketing department. Here is when adding a digital experience platform to your martech stack can help.

In general, you could use a DXP when: 

  • You want to optimize customer journeys across different channels
  • You need to improve content management
  • You want to make your branding and messaging more consistent

How DXP works to organize omnichannel marketing

Here are the key elements of digital experience platforms. 

  • Content management. DXP platforms have built-in content management systems (CMS) that offer storage, where you can keep and manage your content at scale. You can further plan and publish your content from this storage right away, as DXP can integrate with your marketing automation and publishing tools. DXP also lets you monitor the performance of your content.
  • Analytics. DXP lets you collect customer interactions with your content. And you don’t have to piece it back together manually from interactions across several platforms. Actionable real-time insights from the customer data can be used to personalize the provided digital experiences.  
  • Customer data platform. It gathers customer data, segments the audience and creates user profiles from it.
  • Personalization. DXPs can evaluate behavioral data and first-party data (data provided by customers themselves in online surveys, forms and such) to produce customized experiences for each user.

Empower your marketing with tech solutions

For companies looking for ways to bridge the gap between them and their customers, both CDP and DXP are great tools to add to their marketing tech stack. Customer data platforms are more suitable for companies that want to organize information about their customers into a unified database and analyze their audiences more effectively. On the other hand, DXP deals with running multichannel marketing campaigns and managing content creation and distribution. 

If you need help in finding perfect marketing tech tools for your business and configuring your martech stack, do not hesitate to get in touch with us

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