A Customer Data Platform has the potential to revolutionize your business by ingesting data from each one of your marketing platforms, unifying it to create a single source of truth for customer data, then using that information to power marketing campaigns for better prediction, targeting and personalization. But the decision to build or buy a CDP isn’t one that any company should take lightly, as it will have repercussions throughout your brand for months, or even years, to come. It will affect the setup time before you can start benefiting from your new technology, it will affect the costs you’ll need to factor into the budget, and it will have lasting impact on your ability to compete in what, at the moment, is a very turbulent and uncertain market.
There are pros and cons to both building and buying, and which method is best suited to your company’s needs will depend upon your team’s requirements, analytical experience, skill set, available resources and existing systems. So, it’s essential to take the time to consider 6 elements that could spell the difference between a successful implementation project and a high-priced, flawed venture that you’ll have to live with. We’ll delve into all of these factors with our partner, InfiniteIQ Consulting, in greater detail in our webinar on August 26, but here’s an overview of those 6 critical factors and how they might influence your final decision.
1.) Cost
When considering cost, don’t forget that this doesn’t just include project start-up costs, but those for ongoing maintenance as well. Gartner suggests that marketers should consider their budget profile before contemplating a build, and only go ahead with one if their funding is substantial and ‘aggressive’.
Build
The cost of a build can be shocking for the uninitiated and unprepared. Remember, you may face support, licensing, maintenance and training costs for multiple platforms, depending on your baseline marketing setup, as you’ll need to achieve integration with these systems. The resource cost will also be considerable. It will depend on the number of systems that need to be integrated and your team’s experience in handling projects of this type. If you have the support of IT and the budget to back up your ambitions, a build can lead to a better ROI. Assuming you have the skills in-house to manage and maintain your CDP, ongoing costs may not be as large as with a buy – that is, until your system needs an overhaul to bring it in line with the cutting edge technology of your competitors. If you have to pay a third party to manage it, you could see R&D costs skyrocket.
Buy
When buying a CDP, the cost of startup won’t be small but you’ll only have one license, training and maintenance fee to worry about. The vendor will take care of compliance and compatibility issues, and everything will be set up quickly, so you won’t have to worry about the money drain dripping on and on thanks to the labor costs of engineers, data scientists and developers, all beavering away at the same project. However, remember that the more help you need setting up the system, the pricier the venture will be, and you’ll have to factor ongoing license (and potentially management, if you don’t have the necessary skill set) fees into the budget. Any aspects of the work you can’t handle, you’ll need to pay for.
WEBINAR: Build or buy a CDP? Consider 6 critical factors
JOIN us as we delve into all of these factors with our partner, InfiniteIQ Consulting, in greater detail in our webinar on August 26.
2.) Compelling time frames
Build
Do you need a CDP right now to stay competitive? If it’s possible to re-jig your existing systems temporarily to try and gain some CDP benefits, then that will give you more leeway when it comes to your project roadmap. Also, don’t forget to consult with IT to see where you stand in the line. The time frame of an internal project is likely to be impacted by a long list of other internal projects awaiting their attention. The multiple vendors included in the marketing stack will also mean time spent on integration, which can be a tricky business when different platforms within the stack may be primarily owned by different departments with different priorities. This could lead to disagreements regarding design and implementation, and potentially mean that the finished CDP doesn’t deliver 100% of your wish list requirements. There really aren’t any time frame advantages to a build, since gathering the necessary data will take time, but if differentiation is your main aim and most of your systems are customized, so that a bought CDP will meet less than 60% of your requirements, it might be worth the effort.
Buy
Gartner suggests that, if a commercial solution can meet 80% of your requirements, you should consider saving yourself a lot of time and effort by going with a buy. A ready-built CDP can be working within weeks, rather than months or years. After all, vendors will offer a productized solution and a standard onboarding approach. They’ll have been through this process many times before, and have leveraged learnings from each implementation that will help them to ensure that yours goes smoothly. Their timeline estimates will be accurate too, so again, there will be no worry that the project could drag on and on (your business may not be in a position to wait for an uplift). There really aren’t any time frame disadvantages to a buy, except where you have such tailored systems and skilled in-house teams that a vendor’s service couldn’t hit the same mark.
3.) Quality
Build
As previously stated, one of the huge advantages of building your own CDP is that the quality of the features delivered will be dictated by you. That means the CDP should be able to deliver everything you want it to, to the desired standard and without any restrictions set by a vendor. However, that’s assuming you have the experience and expertise needed to do a good job of a build. If customer experience is everything, and your business has a strong track record of delivering beautifully tailored technology solutions, it might make sense to hit every feature on your wish list and ensure a perfect tie-in with legacy systems by placing your project in the safe hands of your internal talent. However, if you’re not completely confident that the resulting CDP will fit the bill, then think twice. If it isn't up to scratch, the value that it will deliver to the marketing team will be limited, as will its impact on customer engagement.
Buy
The vendor you choose will largely dictate the quality of the solution you end up with. Of course, all vendors have the opportunity to benefit from the collective research and development of their client bases, and they will know how to adhere to industry regulations and expected standards. However, different vendors promise different functionality and some are not as experienced as others. If you want a vendor who will deliver the features you want, efficiently and reliably, you’ll have to do your due diligence and consider the reputations and offerings of the various candidates. Remember, you’ll need the support of your business’s IT stakeholders to source the right partner, so get their buy-in on the project early. Once you have the right partner, you’ll be able to rest easy regarding their experience and capabilities to deliver what’s promised and guide you through the setup and management of the new heart of your MarTech stack.
4.) Control
Build
With a build-your-own solution, control of the project rests with you. This can be a blessing or a curse. On the one hand, you can organize the build project according to your business’s needs, so that the timing, budget and features are all tailored to suit. This might be a ‘must have’ if your business has a reputation for being a cutting-edge competitor and riding the first wave of new technologies. As well, if updates and changes are needed to ensure your brand experience remains well above par, you can make them and keep on constantly developing and improving. You won’t have to rely on a vendor’s update schedules and priorities. On the other hand, your build timeline may be impacted by various vendors in the stack, and the risk for the project rests with you, with no single vendor to share the accountability and challenges. Consider how this could impact your level of control.
Buy
If your brand is all about the product and services you offer, a bought CDP should be sufficient to deliver the level of customer experience you need. As mentioned, you will to some extent be at the mercy of your vendor when it comes to updates and developments. However, the burden on internal teams to action these will be less, and many vendors not only accept change requests but also leverage client feedback to drive the overall roadmap. Chances are, if you’re asking for a feature, another client is facing a similar challenge and asking for the same thing. So, while you give up some of the internal control, you also get the time and cost benefit of group needs.
5.) Maintenance
Build
A built solution means you can perform maintenance at times that suit you – the best time of year or time of day to ensure that the impact on your customers and staff is minimal – and angle any updates to meet your needs. You’ll also have no worries regarding the quality of maintenance offered by a vendor. However, all of the maintenance burden, potentially for multiple platforms or systems across the marketing stack, will fall to your IT Team. Plus, if something goes wrong with one of those platforms, the vendor may shrug off responsibility and point the finger at them. Can they feasibly offer you the levels of management and ongoing support that you will require, exactly when they’re required to tie in with your plans, or do they have their own projects to attend to?
Buy
Maintenance of a bought CDP might cause minor disruption to your system, since it is unlikely to be performed at the best time for you, and it may not fully fix any ongoing niggles your company is experiencing. However, there will just be the one maintenance schedule to adhere to, and the worry of doing so will fall to the vendor. They will be responsible for the quality of that maintenance, and if issues do occur, they will help you to troubleshoot them. Since the vendor’s customer base will expect a certain quality of technology, you can be sure their R&D Team will be up to scratch, removing the danger that your CDP’s capabilities and best practices might fall behind those of your competitors'.
6.) Competitive advantage
Build
As far as the advantages delivered by a build-your-own CDP go, you will have complete control over your customer engagement features, so the resulting engagement boost will be considerable. Assuming you have adequate time, money and internal skills to construct a first-class platform, the customization of your solution will be superb. You will be able to select the metrics you need to improve to shut out your competitors, and work wholeheartedly towards that aim. However, even the most skilled team in the world will take time to construct and customize your perfect CDP, and you’ll need to factor that delay in when calculating the overall competitive advantage delivered. It may take some time to see an ROI. You’ll also need to consider how you will future-proof your technology to ensure that any competitive advantage it gives you isn’t fleeting.
Buy
Let’s face it, no bought CDP will meet your business’s every requirement straight out of the box. However, your solution will be up and running much, much faster, which means you’ll be able to start reaping the expected benefits rapidly. If your competitors are storming ahead of you, it might be time to opt for a speedy solution. You’ll also profit from the advice and know-how of an experienced vendor, and if you’ve picked a first-class one, they will listen to you when it comes to your needs and requirements and do everything they can to customize the platform to meet them, so that you stay competitive.
WEBINAR: Build or buy a CDP? Consider 6 critical factors
To hear a balanced discussion regarding the merits of both options, which will help you to evaluate your business case and requirements, and gain first hand advice on which option will best suit your brand’s needs, sign up for our webinar now. You can watch live on August 26 or catch up on-demand.
