Composable, packaged, unbundled, traditional, reverse ETL, zero copy – these are just a few of the terms used to describe customer data platforms (CDPs) today.
If you find that understanding the CDP marketspace is a bit like trying to discern meaning from a word salad (defined by Merriam-Webster as “a string of empty, incoherent, unintelligible or nonsensical words or comments”), you are not alone.
One study from PureSpectrum found that 31% of marketers say that CDP vendors do a poor job explaining what their CDP is and why it is needed. Based on what I hear from the marketers I talk to, I would say that number is considerably higher.
In an industry with more than 170 vendors and an estimated $19 billion in revenue by 2027, it is inevitable that vendors will continue to seek the high ground of differentiation when it comes to emerging trends and capabilities. In fact, this is nothing new.
How it all began: Original definition and classification of CDPs
In 2016 the CDP Institute published the first formal definition of a CDP as “a marketer-managed, packaged software that creates a persistent, unified customer database that is accessible to other systems.” At the time there were four basic CDP characteristics: ingesting data, unifying profiles, segmenting audiences and provisioning insights. As the CDP caught marketers’ attention and rose in popularity, vendors with extended capabilities jumped into the market – causing confusion and making it difficult for marketers to make apples-to-apples comparisons when evaluating CDPs.
To combat this confusion, the CDP Institute developed categories of CDPs (data, analytics, campaign and delivery) based on the use cases that they resolve. These categories provide a much-needed framework to compare CDPs with similar capabilities based on the specific use cases that marketers want to solve. Today there are over 170 vendors listed in the CDP Institute vendor directory and more than 50 discrete use cases ranging from simple data unification to complex, multichannel marketing hub capabilities such as journey orchestration and NBO offer delivery.
Unfortunately, neither the analyst classifications nor use cases include composability and the related emerging terms we see today.
You say potato, I say potahto
So, what exactly is a composable CDP? That depends on who you talk to. Here are a few of the definitions I have come across for composable CDPs:
- A composable CDP has the same goal as a traditional CDP but it does not store data outside of your current data infrastructure. Instead, it acts as an activation layer for journey orchestration and sends data to front-line marketing tools.
- The concept of composable software is that systems are built and connected together by modules. Composable CDPs (also known as unbundled CDPs) are touted by vendors that want to sell their software as components.
- Composable CDPs enable marketers to activate their data from existing data warehouses without moving it into a CDP tool.
- They are built with best-of-breed applications connected directly to the organization’s data cloud. Composable CDPS have capabilities to activate data directly from the data cloud, eliminating the need to move, sync or ingest data into the CDP from multiple sources. Here, “best of breed” means handpicked tools (identity resolution, activation layers, etc.). This definition contrasts composable with packaged CDPs, which are defined as fully managed, off-the-shelf applications.
This boils down to two distinctly different ways that vendors talk about composable CDPs. One focuses on the data architecture (no need to lift and shift all the data into the CDP) and the other on how the capabilities are packaged (buy/use only what you need, plug-and-play capabilities). Reverse ETL and zero copy are simply nuanced versions of the no-lift-and-shift data architecture. Some vendors combine data architecture and capability packaging into a single definition for composable; others emphasize only one or the other depending on what best fits their tools.
No matter how it’s defined, the composable CDP is here to stay
Composable CDPs fitting both the data architecture and plug-and-play capability sets are here to stay. In fact, they have the potential to significantly shake up the industry, particularly from the data architecture perspective.
The increasing popularity of cloud-based data storage solutions such as Snowflake and Google BigQuery – along with significant existing data infrastructure investments for large organizations – adds appeal to the concept of allowing CDPs (and other marketing technology) to directly access data in these existing systems rather than requiring the creation of another data silo.
This is particularly relevant when you consider that three of the top six MarTech challenges identified by marketers to the CMO Council (integrating customer data sources, linking online and offline customer identities, and poor data quality) are challenges pertaining to customer data that CDPs are supposed to solve but seem to be falling short on.
SAS® Customer Intelligence 360 – composable before composable was cool
SAS Customer Intelligence 360 is a multichannel marketing hub with embedded CDP capabilities that was composable long before everyone else started talking about it. SAS enables marketers to unify customer data, understand digital activity and enable analytically driven, real-time activation with a hybrid data architecture that easily integrates with tools already in your MarTech stack.
Unlike traditional CDPs or the new composable toolsets, SAS Customer Intelligence 360 was designed with a hybrid data architecture and the ability to complement rather than replace existing MarTech tools.
Keep your data where you want it. With our hybrid data architecture, there's no need to lift and shift all your data into a marketing cloud or CDP in order to use it. Pull only the data you want to activate when you want to activate it, taking advantage of your existing data infrastructure, saving money on data movement costs, and promoting governance and privacy.
Use only the capabilities you want. Our API and connector framework provides a range of out-of-the-box connectors to third-party applications and APIs for multilevel integration and real-time or batch integrations. You’ll get simplified deployment and integration that lets you capitalize on your existing MarTech infrastructure.
Give your marketers simplicity, speed and control. A simple and intuitive UI lets marketers easily define audiences and associated customer attributes, and start personalizing and actioning the data. No SQL or sophisticated analytical skills are required. The time to market for journey creation is significantly shortened because IT does not need to select and move the data from cloud-based data sources into the software.
