Are marketers cooling on CDPs?

The percentage of marketers using CDPs dropped from 31% in 2022 down to 25% in 2023, according to a report from the CDP Institute. It’s the first time the number has dropped in the history of the annual survey which began in 2017.

Marketers using other kinds of unified data customer databases also dropped in the same period, from 38% to 33%.

However, 20% of organizations say they have a CDP in place and are delivering high value with it. This is a record high for the survey.

Methodology. This was a global survey of CDP Institute members. Respondents included 79 users and 184 vendors. 62% of respondents were based in the Americas.

Unified or disconnect data? Respondents to the survey showed a wide range in the level of their data unification and activation for customer-facing systems.

25% said many systems were connected to a unified customer database, while a further 8% said added a shared orchestration engine to these unified data. 3% said they had a single system that served nearly all marketing functions.

15% said they had many systems connected to a CRM or marketing automation platform.

Nearly half (49%) said their organization had many disconnected systems that carried out marketing functions. The biggest movement in recent years came in this category. In 2019 and 2020, the number of marketers with disconnected systems dropped from 54% to 39%. As recently as 2022, the number was 43%. One possibility is that organizations are replacing older connected systems with new systems and have yet to link up all the pipes.

CDP plans. Over the last six years, organizations have planned out and deployed CDPs. This year, 20% of respondents said they have a CDP in place and are delivering significant value from it, the highest percentage in this category in recent years.

In 2023, 30% of organizations plan to start CDP deployment in the next 12 months, and 24% have a deployment in process.

The number of CDP customers that report delivering “little or no value” from their platform has dropped from has dropped from 12% in 2022 to just 5% in 2023. Since 2017, the number of organizations with no plans to implement a CDP has dropped from 19% to 8% in 2023. Only 3% this year said they abandoned a CDP project.

Dig deeper: What is a CDP and how does it give marketers the coveted ‘single view’ of their customers?

Top CDP benefits. Survey respondents were asked to pick three benefits that came from their CDP, and here were the top responses:

• Unified view of customer data (77%)
• Analysis (62%)
• Orchestration (57%)
• Message selection (35%)
• Predictive capabilities (34%)
• Data privacy (22%)
• Less reliance on IT (22%)

Why we care. Marketers who are members of the CDP Institute are probably more likely to implement a CDP, but why are they? See the benefits above. The CDP Institute admits that the pool of respondents who are users (79) is probably too low to draw too many far-reaching conclusions this year. The declining number of businesses planning to implement a CDP supports the notion that many organizations already have them. But what about the slight dip in orgs that are using them?

Here’s the institute’s response to the data, from their report: “It seems unlikely that a significant fraction of users would abandon a CDP or other unified system, and most other surveys show continued growth in CDP deployment. It may be that respondents to this survey, being more sophisticated users, are applying a more stringent definition than in the past. The safest general conclusion is that progress in delivering unified customer data has at least slowed.”

One constant since the introduction of CDPs has been the changing definition of these platforms, so this rings true. The technology continues to evolve, and capabilities around orchestration and activation have been added to many offerings in the space.