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Updated on October 21, 2022

Customer data platform vs CRM, what are the differences?

Customer data platform vs CRM, what are the differences? -

Customer data platforms and customer relationship management tools both store customer records that a company can use to gain insights. But how do these solutions differ from one another? This article breaks down the distinction between CDPs and CRMs.

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What is a customer data platform?


Customer data platforms are a new technology that helps companies find and use the customer data they already have to make better business decisions. A CDP enables companies to get a 360-degree view of their customers and prospects, then use that insight to drive better marketing, sales, and customer service.

What is a CRM?


A CRM is a software application that helps businesses manage customer information. It can be used to store contact details, automate business processes, track sales leads and manage marketing campaigns.


What are the differences between CRM and CDP?

CDP vs CRM needs:



Marketers need a web-based interface exclusively built for them; something that is more analytical than a CRM in nature. Such a tool would facilitate data collection, profiling, and segmentation, and assist in taking actionable steps. This is necessary because marketing is expanding and multichannel campaigns are becoming an integral part of it.




Customer relationship management (CRM) systems help companies build, track and strengthen customer relationships to drive customer loyalty and retention. As user interfaces for collecting data about customers, CRMs directly impact enterprise revenue and growth. Therefore, CRM is part of a broader management strategy that supports enterprises in their interactions with customers.


CDP vs CRM data ingestion & management:



CDPs can collect customer data from a variety of offline and online sources, including historical background and behavior. They create a rich view of customers by merging data from various customer data sources, including historical background, behavior, and preferences. This process leads to the generation of a 360° view of the customer for creating personalized experiences and interactions. CDPs store intent, behavior, and preferences through tracking activity. They also de-duplicate customer identities and profile them based on their segmentation information.




CRMs are limited in the data sources they can consume. Sales and marketing departments typically use 1st party data, which is sourced from sales and marketing results.


CDP vs CRM built for:



Customer data platforms gather data from a range of sources and centralize it in one place, where it can be analyzed. Modern CDPs are equipped with features like data quality, data modeling, real-time personalization, and automation.




CRM applications are designed to help sales teams capture, track, and handle the details about new prospects and customers in a sales process. Marketing activity is also brought into the fold of CRM via data integrations with marketing automation platforms or by capturing sales activity from sales representatives and their tools. These applications include all transactional information with the help of financial systems and customer support systems lend service activity.


The final word for the CDP


Customer data platforms (CDPs) collect, consolidate, organize, and present customer data for execution by various marketing systems like personalization engines. CDPs integrate with customer relationship management (CRM) systems to accumulate information like location, age, purchases, page views, clicks, and more. Companies use them to:


-Analyzing customers’ behavior patterns to predict their buying habits.

-Data management includes integration, validation—cleaning.

-Analyzing customers’ needs and identifying key customer attributes or behaviors.

-Managing customer profiles for future use.

-Customer behavior analysis to better segment markets.

-Analyzing customer purchasing history and other behavior to provide more relevant content or eCommerce recommendations.

-Exporting segmented customer lists for deriving business intelligence or executing campaigns.


The final word for the CRM


Since customer relationships are the lifeblood of every business, today’s companies must use CRMs (customer relationship management programs) to streamline their interactions with customers. CRMs facilitate direct interaction with customers and are often designed primarily for optimizing one kind of customer interaction. They’re used by companies in the following ways:


-Ease of purchasing through quote-to-cash processes.


-Analyzing pipeline and forecasting.


-Customer service (post-sales).


-Front-office-related sales.


-Marketing automation via performance analysis and campaign tracking


-Mining for acquiring customers.


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