Although CDPs solve a lot of challenges around creating a unique customer profile, they still suffer from different challenges. There are a multitude of CDP vendors today, along with some customer build CDPs that companies use. These have been able to solve some of the issues, but no one solution solves all the challenges. We will cover solving some of the challenges in the later chapters, but first, we need to understand the challenges.
Companies need to understand and analyze the following challenges before they start implementing CDP:
- Challenge 1: Inability to Scale
Every company starts with a few use cases when implementing a CDP, as should be the case. But selecting a CDP is as much a strategic decision as a technical one. So even if the company is small now, it is important to choose a CDP that can scale. Most CDPs available in the market today can handle small datasets well. Some can handle even hundreds of gigabytes of data. But most CDPs fall short when your organization’s data needs become very large.
Migrating to a new solution to tackle the scale challenge becomes too difficult a task. Therefore, it is important to assess how easily your CDP can scale with the growth of your company and your customer data. Event data can grow exponentially, and it is important to prepare for the future. Scalability remains a big challenge for most of the CDP tools available on the market today.
- Challenge 2: Not User-friendly
CDPs need to be user-friendly in the sense that non-technical users should be able to use the data inside the CDP to create segments and activate the data through marketing campaigns, product analytics, and so on. If, for creating a segment or generating a report, a CDP requires the help of a data engineer, then end-user adoption will suffer. All the hard work of implementing the CDP will go to waste as end-users like the marketing folks or the product analysts will be unable to independently use the product. A CDP has to be user-friendly for non-technical people as well as have provisions where technical talent can make changes according to business needs. It needs to be customizable as well as user-friendly.
- Challenge 3: Difficult to get data in real-time
For certain use cases, like personalized push messages, and marketing emails, we need data to flow from source to destination in real-time. However, most CDP players out there struggle to make the data available for usage in real-time. Where time is a crucial factor, data becomes stale very quickly, and underscores the customer experience. Most CDP players in the market do not have the capabilities to handle gigabytes of data being streamed in real-time, processed in real-time, and activated in real-time.
Figure 2.13: Real-time data (source: https://memgraph.com/blog/guide-to-real-time-analytics)
- Challenge 4: Difficult to demonstrate quickly the value to the business
Ask any CDP implementation consultants, and they will say that it is very difficult to demonstrate quickly the value of a CDP to business leaders. CDP project sponsors want to see early wins and upticks in business metrics once they start implementation of the CDP. But most CDPs are complex and require a long gestation period before they can demonstrate value to the business. In today’s agile-driven technology world, the long gestation period can be a project killer for most CDP projects.
Many companies start implementing CDP with the hope that they will be able to do personalization, user analytics, and so on within a few months. But the chosen CDP tool might take a year of implementation to deliver value. It results in a loss of trust in the project, and more often than not, the project get shelved. Most CDPs in the market today are complicated and time-consuming to implement.The problem is further complicated by the lack of end-to-end CDP solutions. Some CDPs might be good only at getting data from different sources. Some CDPs might be good at activating the data, provided you have collected the data correctly. Some may be good at only cost-effectively storing the data. So, if you have purchased a CDP which does one thing and your business use cases are meant to do another, then you are in a soup. As we said earlier, it is more difficult to migrate from one CDP to another than it is to implement a fresh one. So, we need to be aware of this particular shortcoming of a CDP.