Collision Course: With Greater ESP/CDP Overlap, Which Should You Choose?

All marketers should want a unified view of their customers. If working successfully, 360-degree customer profiles enable marketing teams to send better-placed, better-timed, better-worded messages, which should increase the likelihood of driving action and conversions.

But the reality is that most teams deal with siloed data across disparate platforms. According to Gartner’s 2021 Cross-Functional Customer Data Survey, just 14% of organisations achieve a 360-degree view of their customer. Many marketers don’t have a single source of truth for their customers, let alone the ability to automatically build customer profiles.

Want one customer view? Multiple platforms to the rescue!

A few platforms promise to resolve this issue. Customer data platforms (CDPs) are one such answer. These productised solutions allow marketers to unify customer profile data, after which, they can manipulate it for analysis and/or execution.

The promise of having a centralised, accurate view of customers is so great that vendors selling other platforms have built CDP-like functionality into their offerings too. Nowadays, you can find segmentation engines within multichannel marketing hubs (MMHs), personalisation engines and loyalty management platforms.

More recently, several email service providers (ESPs) have developed decent CDP-like functionality, since – like all the above – basing communications on a solid view of the customer is advantageous. Offering this kind of functionality improves the ROI metrics that email vendors can promote. It also allows them to defend against potential churn as their customers’ needs expand out beyond email alone.

The ESP/CDP overlap

There’s now a high degree of overlap in functionality between CDPs and many ESPs.

ESPs are normally one of the very first martech platforms in the stack for growing companies. So assuming you have one and are thinking of increasing personalisation capabilities, you’ll have a choice to make.

If you’re considering adding a CDP, you should nail down exactly what you’re looking to gain from implementing it. If you have a narrow use case, like being able to send personalised email campaigns to different audience segments automatically, adopting a CDP might be like using a chainsaw when all you need is a bread knife.

This year, email marketing platforms are pushing even further in the direction of profile management. Several have broadened out their capabilities via partnerships and acquisitions, often becoming mini-MMH/CDP/CRM platforms in their own rights.

So if you’re struggling to send messages to segments of your audience, it may be worth looking at your current ESP’s add-on functionalities (and their competitors) to see if there’s a simpler option out there.

Which path to choose?…

There is no definitive ‘right’ or ‘wrong’ when it comes to which platform is best at helping your marketing team. There are multiple best-practices to help you decide though.

My best advice: analyse the root cause of your marketing inefficiencies before you invest in a new platform, to fully understand the business case you’re seeking to solve. Then identify the platform(s) that would help you address those challenges in the easiest way. Would adding another platform really help? Or is there something you could do to utilise your current martech stack better?

• A good starting point is Gartner’s How to Build and Present a Business Case for Marketing Technology Investments (clients only).
• If you’re confused by the overlapping space between CDPs, ESPs and all of the above, then read A Guide to What Is — and Isn’t — a Customer Data Platform (clients only).
• If you’re wondering where to turn next, Gartner’s Market Guide for Customer Data Platforms (clients only) is a really good resource, giving the latest on the CDP landscape.
• Or, if you’re a Gartner client, set up an inquiry with one of the team, who can talk you through your decision!