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Privacy, Agility, and AI: Emerging CDP Trends for 2024

On December 26, 2023 | 6 Minutes Read
Conversational AIConversational EngagementConversational MarketingCXGeneric

Global data creation is likely to surpass 180 zettabytes by 2025, and a significant part of this comprises business data that helps companies fuel their customer service efforts. Proper analysis of real-time data gathered through customer activities like searches, purchases, or queries helps businesses identify behavior patterns and tailor strategies to offer customers the best experience. 

And this calls for leveraging the most appropriate technology to help collect and manage data accurately.

Of all the tools that can help streamline data collection and management, AI-powered customer data platforms (CDPs) can prove to be a game changer. 

Turning Numbers Into Narratives With Customer Data Platforms

CDPs form the point of contact between customers and businesses. These platforms gather data related to customers’ purchase history, mobile applications, social media, and various other sources. CDPs collect all this data, unify it in a single database, and provide a comprehensive profile of individual consumers. CDP Trends for 2024- Consumer Insights

Businesses can transform the customer experience with the help of generative AI. Generative AI applications in CDP involve LLMs (large language models) that can be fine-tuned to a business’ domain to gain valuable insights into customer preferences and choices. 

AI-powered CDPs have the power to perform tasks like data unification, conducting predictive analysis, and customer segmentation. This information is then used by businesses to tailor their messaging and curate the best experiences for customers.

Autonomous conversational engagement powered by generative AI also ensures adherence to strict guidelines for customer data privacy. 

Emerging Trends in the CDP Landscape for 2024

The CDP industry revenue increased from 1.3 billion US dollars to 2.3 billion US dollars from 2020 to 2023. A study conducted in September 2022 showed that 44% of marketers, professionals, and publishers across nations used CDP to offer personalized experiences to their customers. 

CDPs continue to dominate the customer data space. Therefore, businesses must be on top of emerging CDP trends and offer a seamless customer experience while ensuring agility and data privacy. 

Let us discuss some emerging CDP trends businesses must look out for in 2024. 

1. AI-driven CDPs for enhanced customer experience
 AI-driven CDPs for enhanced customer experience

AI-powered CDPs can understand customer behavior by keeping track of their purchase history, preferences, etc. Generative AI can also help anticipate customer behavior and preferences by analyzing historical customer data. AI can leverage the predictive model, with the help of which businesses can curate marketing strategies accordingly so that customer needs can be met. 

More and more businesses will incorporate conversational AI in their marketing efforts in 2024 to increase engagement and provide relevant, delightful customer experiences. When customers are satisfied with the service of a business, the rate of transactions is bound to increase. 

Axis Bank’s AI-powered bot, Aha!, has helped revolutionize customer interactions and offer personalized experiences to customers, leading to a 31x increase in new users and a 50x increase in transactions.

2. Increased focus on data privacy
Increased focus on data privacy

The incorporation of AI has revolutionized how customers can communicate with businesses. All industries, ranging from fashion and lifestyle to banking, use AI chatbots to gather information on customer preferences and deliver personalized solutions. 

For instance, several renowned banks use AI-powered bots that answer customers’ banking queries and offer personalized, contextual offers that might interest them.   

However, several concerns surround the security risks these AI-driven technologies can introduce. Ensuring data privacy helps to establish a relationship between customers and businesses. Businesses need to ensure that customers’ personal information is stored securely. 

Stressing on this critical issue of data protection of customers, the European Union has mandated GDPR (General Data Protection Regulation) in 2018. The increased scrutiny of data privacy laws and regulations has pressured businesses to collect user data and store it responsibly and ethically. 

In 2024, businesses will emphasize protecting personal data in the CDP space. Some CDP platforms offer a GDPR-reliant landscape integrated with generative AI to gain deeper insights into customer behavior without compromising data security or efficiency. 

3. Data agility for quick, real-time processing
Data agility for quick, real-time processing

CDP helps to gain a unified view of customer profiles by integrating data from different sources. However, this cross-platform integration might take some time, and the results thus produced may be inaccurate. 

In 2024, businesses will likely aim at data agility and real-time data processing in the CDP landscape. This is an efficient method of data analysis as data is processed as soon as it is captured. As a result, businesses can collect and extract value from mountains of data quickly and efficiently.   

Prominent CDPs today gather B2C and B2B data from different systems and conduct real-time processing for the profiles to be activated across multiple channels. This enables personalized recommendations, thereby enhancing user experience. 

4. CDPs with omnichannel capabilities
CDPs with omnichannel capabilities

Customers prefer businesses to be accessible across various platforms like social media applications, websites, email, in-store apps, and even SMS. Companies, therefore, need to be prepared to meet this expectation of the customers and provide a consistent experience across different channels.

This can lead to increased demand for CDPs with omnichannel capabilities. Such CDPs can collect information from different channels and provide a unified view of customer preferences so businesses can curate their marketing strategies accordingly. 

Looking Forward 

The customer data platform market is expected to grow at a CAGR of 17.9% between 2022 and 2030. CDPs will no longer be mere data collection tools in 2024. Generative AI applications in CDP will enable businesses to know their customers better and provide them with the most personalized treatment. This will help enterprises to strategize for long-term sustainability and achieve steady growth. It will also allow the business to be agile and flexible enough to adapt to ever-changing customer needs and preferences.

However, CDPs must adhere to data protection regulations and robust security measures as transactions increase. Therefore, in the future, CDPs must focus more on data security and privacy while integrating technologies like generative AI and ML to gain better insight into customer behavior.

Do you want to leverage the benefits of a conversational engagement platform that lets you be present for your customers across channels? Gupshup can be your partner in delivering frictionless customer journeys. 

With Gupshup, you can leverage generative AI to create domain-specific models that can be used across industries. Unlike other CDP platforms built for email, app, or web experiences, Gupshup helps businesses deliver conversational experiences by enabling 1-on-1 private interactions with customers. This allows businesses to gather first-party data and facilitate personalized interactions while ensuring data privacy.

Visit Gupshup to learn more. 

Vartika
Vartika leads marketing at Gupshup and has ~16 years of experience in marketing across early-stage startups and large enterprises. A Marketing specialist by profession, a wanderer at heart, an enthusiastic cook, and a painter for the soul.

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