B2B data requirements are complex, particularly for Marketing and Sales. We need a lot of it, both in terms of overall coverage and depth; we need data on people (demographics) and companies (firmographics), and we also need to connect the two for context (e.g lead-to-account matching). On top of it all, we need analytics tools to draw out meaningful insights from volumes of data we couldn’t possibly process ourselves — like customer fit and buyer intent.
Requirements for CRM, marketing automation, and other existing B2B Sales and Marketing systems are equally complex. These platforms have provided so much value that it’s hard for most B2B marketers and salespeople to imagine life without them.
So why aren’t these systems meeting B2B marketers’ and salespeople’s needs? Why is data management the number one challenge cited by B2B marketers? Why can’t the increasingly sophisticated CRM and Marketing Automation Platforms solve this challenge?
The simple answer is that these technologies were built for different purposes. Data — and specifically the way B2B Sales and Marketing teams relate to it — has evolved considerably since these platforms were invented. The use cases are much more complex, and many new supporting technologies have emerged that have opened up new potential that B2B marketers and salespeople could scarcely dream of a decade or two ago.
CRM can only take you so far…
CRM systems are primarily designed to help sales and service staff interact directly with individual customers and prospects, in person, on the phone, or by email and messaging. This requires a technical approach that can quickly find and update data on one customer at a time – specifically, a highly structured data model with limited data volumes, which is easy to search and maintain. This is quite different from the approach needed to gather and analyze data from many different systems, which will often be in unknown or frequently changing formats and may come in huge volumes.
Additionally, these systems work primarily with data that their users have gathered directly from customers or prospects, so are limited in scope. What’s more, this kind of static data quickly deteriorates as people change jobs, positions, responsibilities and so on.
Marketing Automation is a must, but still not the answer…
B2B marketing automation systems were originally designed to send bulk email campaigns to names from the CRM system, leading to single-level data models that use email address as the primary customer identifier.
Some of these constraints have been eliminated in today’s most advanced marketing automation products, but the legacy of simplistic data structures remains. Abilities to ingest data from many sources in many formats, store complete details in a queryable format, manage data quality, do identity resolution, and share the stored data are extremely limited. Only some systems provide connectors for third party data or do specialized analytics.
Data Management Platforms are great, but have narrow applicability
Data Management Platforms (DMPs) are even more specialized than CRM and marketing automation. They are designed to quickly retrieve advertising audiences and share them with ad buying systems. This requires yet another data structure that is optimized for fast selection and list generation: this generally has an identifier, such as a cookie ID, with a long string of attribute tags attached. This cannot efficiently store large volumes of details – such as individual transactions or details of website visits.
In addition, many DMPs do not store personally identifiable information for privacy reasons, even though such information is a critical part of any customer record. Some DMP vendors have expanded their scope, typically by adding auxiliary data structures that can store more details and personal data. But even those systems rarely have the multi-level data model, data quality, identity resolution, and analytics features needed for an effective B2B customer database.
It’s important to recognize that these limits do not reflect flaws in these systems. They simply reflect the fact that they are built to serve other needs. Criticizing a CRM system for being a bad customer database is like criticizing a pickup truck for being bad at Formula One racing. It was never designed for that job.
So what’s the answer?
How Customer Data Platforms fill the gap
Increasingly, B2B companies are turning to Customer Data Platforms (CDPs) as the answer to Marketing and Sales’ data woes. While traditionally regarded as a B2C technology, CDPs are starting to prove their value to B2B marketers and salespeople in equal measure — driving Sales-Marketing alignment, greatly increasing efficiency by automating data management, and most importantly driving more revenue.
Watch this 2-minute video for a brief explanation on how CDPs provide value to B2B Marketing and Sales:
There are 5 key technical reasons why CDPs are able to provide what existing Sales and Marketing automation platforms cannot:
1. CDP is designed as a central customer database
This is really the key point: the CDP was designed from scratch to build a unified customer database and deploys the technologies that make this possible.It’s not just a matter of intent: the technologies used by CDP, such as NoSQL data stores and API-based architectures, are themselves relatively new, so it wouldn’t have been possible to build CDPs in the past even if a designer had tried. But what matters today is that those technologies do exist and CDP developers have adopted them for this purpose.
2. CDP connects many systems
RM and marketing automation platforms are designed primarily to work with data they generate internally. If they were the only systems that marketers had, then they could serve as the unified customer database. Indeed, their vendors would very much like to provide that database because that would make it much harder for their clients to switch to a different product.
But today’s marketers have many systems that contain useful data and they don’t want to lose the freedom of adopting whichever combination of products they want. So it makes great sense to have a separate customer database system that has no bias in favor of working with particular applications. In fact, the CDP enhances that freedom by storing customer history outside of individual applications, so marketers can switch to new applications without worrying about losing their data.
3. CDP has specialized customer database functions
B2B CDPs have the multi-level data model, data quality, identity resolution, analytics, and data synchronization features needed for B2B operations. These are combined in a single, prebuilt package, making it vastly simpler to deploy the CDP than to build a comparable customer database from scratch. Similarly, B2B CDPs have prebuilt connectors for common B2B data sources and execution systems. This further reduces the time, cost, and effort needed to put a unified customer database in place.
4. CDP often provides third party data
Many B2B CDP vendors create their own company and individual databases. These are often generated from a combination of the vendor’s own research and by integrated data from other providers. The vendors can easily make this data available to their clients as part of the CDP deployment, again speeding time to value. Vendors who offer advanced analytics such as prospect identification and lead scoring are especially well positioned to use this data as part of their standard offerings.
5. CDP vendors are experts
B2B CDP vendors are specialists in B2B customer data. This is important because of the specialized requirements we’ve listed above. Working with experts gives each client the advantage of the vendor’s previous experience, enabling the vendor to help the client build a successful database quickly and to use that database effectively over time.
To learn more about B2B Customer Data Platforms and how they could help your business increase efficiency and generate more revenue, download our free white paper: