On October the 14th, during a busy week for SAP which included the ‘Procurement Reimagined’ online event (summarised here by IgniteSAP), Christian Klein (SAP CEO) introduced the new ‘SAP Customer Data Platform’ at CX Live: a much larger global virtual event.
With the ever-increasing tide of data, customer data platforms have become an essential tool for companies to collate and interpret customer contacts and customer device activity. Effective use of customer data to drive further interactions with customers can dramatically increase the lifetime value to a company of a single customer and so are an excellent way to enhance profits within the existing customer base.
This article from Forbes illustrates the necessity for large corporations to research, invest and develop CDPs:
“They allow you to gather information from many different channels, platforms, and devices into one location to create a whole and up-to-date view of your customer. …They also…create a clean and unified record and make that data available to marketing teams and any other stakeholders that could benefit. This in turn allows you to create even more personal and relatable marketing campaigns and content, and to create unique customer experiences that will improve their satisfaction with your company.”
The fierce competition in online commerce has led to the rapid expansion of the market for CDPs that can help leverage customer data to get the extra boost which can be the difference between expansion and shutting up the online shop.
According to data published on marketsandmarkets.com ‘The global Customer Data Platform (CDP) market size is expected to grow from USD 2.4 billion in 2020 to USD 10.3 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 34.0% during the forecast period.’
SAP has been active in this area for some years now with a customer data offering built around a customer data cloud service and augmented with extensive acquisitions. These include Hybris (acquired in 2013), Abakus (acquired in 2016), and Gigya (acquired in 2017), running in concert with Qualtrics’ customer experience analytics (acquired in 2018), and more recently with the acquisition of Emarsys: a customer engagement platform that allows for complex personalisation of customer interactions. The acquisition of these solutions has run in tandem with internal research and development (in the form of SAP Customer Identity and Access Management and SAP Enterprise Consent and Preference Management solutions) and the integration of these into a more simplified user experience has resulted in the production of SAP Customer Data Platform.
In the introduction to SAP Customer Data Platform in his keynote speech at CX Live, Christian Klein explained why now is the time to integrate these technologies.
“Our CX business has grown 20 percent faster than the industry average since the start of the pandemic…CX is an integral part of the intelligent enterprise…Even our grandmothers have shopped online and have waited at the door the next day for the delivery… COVID-19 has challenged all companies to accelerate their business transformation and forced them to reinvent the experience for their customers.”
He went on to underline the importance of CX in SAP’s overall development in the future.
““You cannot think about CX separately; it needs to be considered as an integral part of an intelligent enterprise…That’s why CX is one key element of SAP’s holistic strategy.
“We are continuously evolving our CX portfolio while keeping our focus areas at heart – SAP Commerce Cloud, SAP Marketing Cloud, SAP Sales Cloud, SAP Services Cloud, and our brand-new SAP Customer Data Platform… Our investments in those areas, most recently the planned acquisition of Emarsys, demonstrate our commitment to the CX market.”
The SAP News Press release following the keynote speech defined four key areas that the new Customer Data Platform is design to address:
- Connecting every data source in an organisation together with external data to create unified customer profiles.
This centralising function of SAP Customer Data Platform deals with the problem of coherent interpretation of data which can otherwise cause the process of personalisation to be extremely time consuming.
- Enabling a transparent, trustworthy data-privacy strategy.
This aspect of data collection is necessary to ensure that companies collecting data are compliant with regional data privacy legislation such as the EU General Data Privacy Regulation. This will presumably be automated to ensure that customers are automatically given an opportunity to consent to data collection in the course of interaction with the company.
- Providing organisations with a complete understanding of customer preferences and behaviour.
This area of the platform design addresses the need for real-time customer insights, and adds information about preferred channels of communication to the customer profile: making it easier to bring about mutually beneficial interactions.
- Combining back-office and front-office data to build highly personalised profiles of customers.
The degree to which interactions with customers are personalised has direct influence over the customer’s perception of the brand and the lifetime value of the customer to the business: extending the number of interactions and consequently, potential transactions.
Trond Anderson, the head of IT Strategy and Architecture for a large consumer electronics retailer, Elkjøp Nordic AS, commenting on the new SAP Consumer Data Platform, remarked:
“No two customers are the same, and no single customer is perfectly predictable…With SAP Customer Data Platform, it is possible to create a contextual view of the customer and couple it with a unified profile, to better anticipate their wants and needs as they express them. This will increase the effectiveness of our engagement through real-time data management, while ensuring we are handling the data in a compliant and respectful way.”
Bob Stutz, SAP Customer Experience President gave a statement positioning the SAP Customer Data Platform at the forefront of CDP development and differentiating it from other market leaders like Oracle, Microsoft, Adobe and Salesforce.
“SAP Customer Data Platform opens the concept to a new world of opportunities…[it is] one of the most advanced enterprise-grade CDPs. It can truly deliver personalised experiences that nurture anonymous users into known, loyal customers using the customers’ preferred channels, unifying vast amounts of front-office, back-office, and experience data as only SAP can.”
From the perspective of those outside the organisation, the convoluted and overlapping process of acquisitions and rebranding over the last five years have been byzantine in their complexity, but it appears that this was due to the rate of change in global commerce and the technology sector in general. Now the synthesis of these diverse solutions to aspects of digital commerce are coming to fruition in the form of a simplified user experience which we hope will provide businesses with an answer to everyday problems, and allow them to concentrate on strategy rather than mundane and repetitive tasks. As long as this aspect of SAPs portfolio fulfils its promise and the Customer Data Platform sits comfortably with other sections of SAP then digital commerce may paradoxically become less of an exercise in computing and perhaps even bring the creativity and joy back into doing business.