Do you find researching customers’ needs and insights more troublesome than ever due to the constantly changing trends on the market?
Or maybe you run a digital business where you have access to the enormous amount of data about each customer but do not know how to translate that information into a personalized and unified offering which would meet your customers’ demand?
Do not worry if you answered yes on any of those questions; you are not the only one. Companies, especially those which can be characterized as SMEs find it extremely difficult to stay updated with their customers’ preferences.
For that reason, we are here to help you solve this issue without the need of spending tons of money and sacrificing your valuable time.
Custimy specializes in providing Customer Data Platform to small and medium enterprises in order to help them stay competitive and innovative within the market.
We believe that as a SME business owner you should go through this article to find more about the nature of the SMEs’ business and the potential the CDP might have for you.
SMEs challenges in 2020
The market of SMEs is very saturated, since they account for about 25 million enterprises in the EU itself, meaning that the competition is fierce and the risk of falling out of business is immense.
At the same time, due to the lack of staff, finances, certain level of novelty and high risk of business operations, CEOs who run small and medium enterprises perform various ranges of assignments, without focusing on their major task which is general decision-making.
That happens due to the fact that a remarkable number of SMEs cannot afford to hire a large assemblage of people to carry out detailed tasks like it can be depleted within large enterprises.
Lack of staff and financial resources translate to inadequacy in defining key metrics needed to run the business.
As a result, SMEs are more likely than large enterprises to make miscalculations and achieve a failure within the customer insight identification, since they are not capable of investing large amounts of resources into finding out the right target group.
What is a Customer Data Platform?
The term CDP is used to describe a comprehensive system which consolidates data from all digital sources, so that it can be used in analysis, customer service, segmentation, marketing campaigns and many other business-related functions. Shortly, CDP software serves modern companies focused on digitalization and operating sizable data sets by enabling them to create unified customer profiles.
Studies show that nowadays an average B2C company gathers customer data from 31 sources, most substantially social media sites, websites and Google search results.
This enormous number of information generated by multiple sources on a daily basis might lead to the disorder of data analysis which can result in inaccurate targeting groups of customers or establishing a mistaken product or a service that would not meet buyers’ needs.
The wrong set of data is considered as being extremely unhealthy for businesses, especially when it comes to SMEs which are more receptive to any kind of mistake and are not able to afford miscalculations.
You are at a vulnerable position in the market dominated by large digitally-oriented corporations, such as Amazon, thus your offerings need to be in line or even more personalized than the competitors’.
Focusing on a good customer experience would raise the competitiveness of your business, making it more personalized and customer-oriented. Your digital customers demand and expect to a greater extent both a personal service and a product-related match such as:
- A consistent and accurate customer experience across your channels
- Tailor-made, personalized recommendations
- Personal, appropriate and accurate communication
- Products that fall within preferences, colors, design and size
There are not many SMEs that can deliver at this level of service, and that means the big companies most often win. If you fail to meet customer expectations, then you have a problem.
If customers think you do not care about them, then they will quickly find an alternative to your business and your products – and it is highly probable that they will not come back. The struggle to regain trust is harder than converting them in the first place.
That is why it is critical to your success to have well-maintained, easily accessible, and insightful customer data. But how do you as a company make sure to meet the 4 requirements of your customers?
A good CPD (Customer Data Platform) can help you. It is a matter of collecting, validating, and analyzing the right data.
For this reason, the Customer Data Platform software gradually replaces traditional CRM methods while offering businesses more detailed, unified, and factual data than its predecessor.
How does the customer data platform work?
Reading customers’ data might be bothersome and the volume and speed of digital data is difficult to gather and consolidate for most common software tools. Fortunately, there is a solution to this. A CDP is specially built to handle large amounts of data in real-time. A CDP can work across your channels and analyze the data automatically.
As mentioned above, CDP offers more sophisticated and specialized software service than the CRM does. CRM stores transaction data which cannot be effectively integrated into other systems and do not have access to all clients behavior details.
Moreover, CRM cannot store a large number of data and successfully translate it into the thorough customer segmentation.
Thus, enterprises, especially those addressing online users might find this management outdated and unsuited to the modern business approach.
What is more, researchers found that present-day customers are not interested in receiving mass advertisements and demand personalized service, fitted to their preferences.
Helps with work overload
By the same token, CEOs running small and medium enterprises tend to be overloaded with work which negatively influences their decision-making process.
They might not find time to look after their enterprises, while being occupied with everyday business activities.
The Customer Data Platform solution would assist CEO and high management representatives in choosing the right customer segment based on the sophisticated insight data to target them at the real-time rate, making the process even more efficient from the time and financial point of view than cooperating with a team of the CRM specialists.
Additionally, many people perceive SMEs as family-run businesses with traditions and outdated values, unable to compete with global corporations.
Nonetheless, times changed and a large portion of the SMEs work with digital clients within the automated area, such as consultants, freelancers, contractors and e-commerce retailers who often serve customers in a more personalized way than the large firms do, due to their local character.
Mentioned enterprises normally acquire new customers online, have their social network platforms developed and their websites optimized, meaning their business is primarily running online.
That way of business approach produces a greater fraction of the data than offline methods which create a possibility for enterprises to understand their customers more precisely than ever before.
However, running business online produces many obstacles. One of the main one concerns miscarrying translation of that large amount of data into valuable insights which could produce devastated consequences for essentially every business activity.
Knowing customers and serving them as appropriately as it is possible is considered a key value for digital SMEs, since most of them depend on achieving a high level of customer service and personalization of their offerings in order to be able to compete with larger, more experienced and affluent firms.
From that point of view, the CDP is a perfect solution for building a strong service focused on meeting customer needs and customization without spending a large part of the capital on hiring groups of specialists and investing immense portions of time into preparing in-depth analysis.
Improve customer lifetime value and customer loyalty
The most effective way to improve your customer loyalty is to give customers exactly what they want: a comfortable, high quality and personalized service experience.
Customer Data Platforms make it possible to deliver this personal experience to all customers both 1:1 and in customer segments based on similarities in product preferences.
A CDP gives you the ability to build a smart loyalty strategy by solving the problem of fragmented data. A CDP arranges and handles all customer data so you can easily and conveniently make targeted and personal service a core competence in your business.
If your data is divided into silos, it is impossible for you to provide a consistently high and personal service to your customers.
Thus you cannot deliver the in-demand omni-channel experience and service that your current and future customers require without having a tool that can analyze your data.
A CDP enables you to deliver up-to-date interactions with your customers 1:1 in a precise and relevant format.
Reduces risk of failure
SMEs are very often classified as risky businesses where fierce competition and vulnerability towards big corporations might cause shutdowns.
Consequently, the need of introducing powerful and customized solutions to handle business is significantly important.
Moreover, most SMEs are not able to afford to risk introducing unsuitable strategies that might push them out of the market. Recurrently, CDP plays a vital role in strategic management within the SME sector.
The CDP lowers the risk of failure by presenting detailed and unified data about customers’ insights according to their ever-changing behavior which is a great assistance in the risk reduction process.
Where the CDP data is coming from?
You might be wondering how it is possible to create such a sophisticated database about customers’ insights. A CDP collects, consolidates and analyzes the following types of data:
- Events: Behavioral data derived from a user’s actions in a session on a website, app or mobile browser
- Customer characteristics: Name, address, contact information, age etc. Certain advanced CDPs can also store data to predict buying behavior
- Transaction data: Purchases, purchase size, product categories, returns and other information from e-commerce or the POS system
- Campaign metrics: Engagement, reach, historical value, impressions, and other metrics from marketing campaigns
- Customer service data: Live chat data, number and length of interactions, frequency, NPS scores and other data from a CRM system
A CDP collects and cross-references all of these data sources so you get very accurate insights into your customers’ preferences, purchases, behavior and history 1:1.
The software scans all statistics regarding the traffic and activities of each customer; their behavior, preferences, psychological and personality profiles, and afterward, creates the most comprehensive segment’s description possible.
All activities are being performed based on the legally-approved privacy regulations and ethics in relation to the GDPR.
Customer Data Platform solutions
Custimy focuses particularly on providing CDP software to small and medium companies across European countries.
We believe that SMEs could compete with larger companies and offer their B2C customers highly personalized service.
We stand against meaningless mass emails, irrelevant products and miscommunications, therefore we offer software suited for modern SMEs that want to optimize their sales, find the right target audience and stay innovative on the market without bearing high costs.