When should you consider a Composable CDP?

We were debating Composable Architectures as an overall concept and I got asked when does deploying a Composable CDP make sense as opposed to buying a packaged one.

I am sharing key pointers to identify, when a Composable CDP is a viable route below, and if you’d like to know more, we will be running a dedicated Composable CDP webinar on the 26^th of September with market-leading vendors – you can pre-register here and submit your questions to our panel in advance!

Composable Architecture has been a dominant trend in the CDP space since 2022. However, one could argue, that with the CDP industry turning 10 and almost 200 companies calling themselves a CDP, the sector hardly needed additional complexity.  

Assessing whether or not you need a CDP in the first place can be a tasking exercise. If you then mix in decisions about the role of your Data Warehouse, as well as how will the two interact, completing such an assessment can quickly become unattainable without an input from several key stakeholders and detailed assessments.

Here are a few ways that can help you to break this down.  

Your Data Warehouse

Start simple: do you have a Data Warehouse?

Does this bring all of your customer data into one place – connecting your Customer Data with your Transactional data? The data might not be in a great shape, it might not be accessible for Marketers to query, but it houses all key UIDs, events and associated dimensions and likely acts as your single source of truth.

If you have answered no – it’s not a CDP you need, it’s a Data Warehouse.

Evidence that indicates a CDP need is: access to marketers. Data quality or cleanliness and a single source of truth can be a red herring.

Whereas for a company of a certain size (smaller) it might make sense to unify, clean and prepare your data for Activation in your CDP, given this will never be a full dataset (it shouldn’t be), you are likely to solve a problem Downstream, while creating another one Upstream with a new data silo.  

This might work if you only intend to use a CDP for Marketing Activation, however connection into your CRM, especially transactional comms triggering, should be approached with caution, if data lineage is lost.

Your Master ID & ID Resolution

Do you have a Canonical or a Master ID, which also links all your other IDs together, with a defined hierarchy and logic in place? Can this be easily shared with Marketing platforms for activation? 

If you have answered no - then you probably need to start with a Canonical/ Master ID and ideally move to define an overall Canonical Data Model – or a translation layer that will help your systems communicate with each other, as they all will inevitably have different data structures.

It sounds like you also want to invest in setting up your ID Resolution.

While both elements typically are a part of a modern CDP, they are also essential data functions and ideally should not be outsourced to a 3^rd party. This will tie you into an expensive contract that will be painful to get out of, especially if you decide to rely on vendors’ proprietary ID merging logic that might be challenging to replicate.

Another indicator for a CDP need is your ability to pass those IDs to Marketing platforms. This should be further pre-fixed with sharing those IDs in a compliant way.

Connections to Marketing Platforms

Does your Data Warehouse easily connect to your marketing platforms? Does that connection persist and can the data be refreshed on a regular basis, meeting Marketing Teams’ requirements?

If it doesn’t, you probably need a CDP.

If you are not a software development company, building & maintaining numerous connections to Marketing platforms might not be a justifiable use of your teams’ time. This is especially true, when something relatively-off-the-shelf is already available – with a dedicated R&D team continuously adding new MarTech connections as they gain traction.

That’s not to say you need a Composable one.

Marketer-friendly UI

Can your Marketing Teams access and query the data they need for marketing activations themselves? Can they create segments? Can they select data fields to be used as triggers for their comms activations? Can they do it without SQL training?

If the answer is no – it’s another reason to get a CDP.  

Marketer-friendly UI, which democratised the data and made it easy to action, unlocking its’ value, was one of the main reasons CDPs have seen such adoption & growth.

In fact, the CMO Intentions 2024 report, published by the CMO Council & Zeta found that 49% of their respondents placed CDP and insights as one of the top MarTech investments likely to drive most value & ROI – 2^nd to only Generative AI.

Again, that’s an indication for a CDP, not necessarily aComposable one.

Real-Time

Can your data warehouse ingest, transform and share data to other platforms real-time?

If it doesn’t, even a packaged real-time CDP will be limited in what it can do. It will however be able to at least increment your DWH dataset with other data points, ingested from i.e. your Data Layer or your CRM or pass these directly for activation, thus partially bridging your real time gap.

Many Composable solutions by now have also solved the real-time activation – at least in part. You will need to work through your core use-cases with each partner to understand the real capability, but the results might be a pleasant surprise. NB – your DWH selection can still play a key role.  

And finally, if you do have a modern data warehouse and have assessed your real time requirements – you are probably a prime candidate for a Composable CDP.

A Case For Composable

When you narrow the requirements and differentiators down to key factors, these next few items will likely play the deciding role in whether or not you choose to go Composable:

• You have invested in a modern Data Warehouse
• You are ingesting all your key data sources into that Data Warehouse
• Your single source of truth & your Master ID live there
• You have already invested resources to clean up and unify your data inside the DWH
• Your DWH is capable of sharing data near-real-time & your use-cases have been assessed for real-time data ingestion, transformation & activation needs
• All you need is a self-serve UI for Marketers to easily access, segment and share your data to marketing platforms
• You would like someone else to worry about developing and maintaining those connections

Yes, this is over-simplifying it, but it will give you a baseline to start from. And, should the initial logic resonate, you will always be able to layer in the complexity and further validation steps, once the initial direction is clear.

If you would like to hear more,  pre-register here & join us on the 26^th of September for a live multi-CDP webinar, where we will be discussing the topic with market-leading Composable CDPs. You can also share your questions in advance, to be answered live by our panel!