Composability is not a coming trend, it’s here — presumably here to stay. That’s the message from MessageGears in a new report based on a survey of 300 enterprise technology, marketing and martech professionals in the U.S. and U.K.
Guess what? MessageGears describes itself as a composable data activation and engagement platform; it is often described as a composable CDP. There’s a heavy investment in composability here, but it does not mean that the report is not of interest. In fact, it doesn’t take MessageGears to tell anyone following the space that packaged CDPs are under pressure.
Defining our terms
OK, let’s get the terminology straight. A traditional or “packaged” CDP is “a standalone platform that stores a copy of your customer data on its own servers and helps you activate that data across various channels and destinations.” That’s the MessageGears definition, with which we won’t quibble. Except to say that, in many cases, brands don’t use the CDP’s activation capabilities but plug them into a specialist activation and engagement solution.
A “composable” CDP activates data that is stored in a data warehouse or data lake (for example Databricks or Snowflake, although there are many out there). It often (not always) does this by reverse ETL, copying data from the “lakehouse.” Some composable CDPs claim to present a no-copy solution, although that’s controversial. In any case, the aim of a composable CDP is not to create a separate, persistent copy of customer data.
Finally, the tough one: “composable.” As I recently wrote, “we currently have at least two uses of the terms ‘composable’ and ‘composability’ in the martech space. One use…refers to the ability of applications (like CDPs) to pull data from data warehouses rather than utilize (exclusively) data ingested into their own, separate database. The other, broader use refers to martech stacks being ‘composed’ from best-of-breed solutions, even though some central solutions in the stack may already have versions of some of those solutions.”
You can’t read a report like this one from MessageGears without bearing in mind that “composable” is a somewhat slippery term. But back to the report.
Dig deeper: What the composability revolution means for CDPs
Here are the headlines
Some of the main takeaways:
- 56% of organizations looking for a new platform would choose a composable over a packaged CDP.
- 70% of enterprise brands have invested in a cloud data warehouse.
- 47% are using the warehouse for customer engagement.
- 90% of brands currently use more than one CDP.
- Only 10% feel their CDP meets their current needs; 1% believe it will meet their future needs.
- When choosing a CDP, the leading capabilities sought are:
- Predictive analytics/AI (67%).
- Data security (66%).
- Deep analytics (65%).
No question: The traditional CDP space is in upheaval. I probably don’t need to refer to the LinkedIn threads complaining about time to implement and hazy (at best) ROI. You’ll have seen them. Also relevant, major enterprise CDPs like ActionIQ and Treasure Data are hedging their bets, offering flavors of composability alongside their legacy packaged offerings.
But let’s pick over some of those stats. The report, remember, is based on “a survey of 300 enterprise technology, marketing, and martech professionals.” That’s right, this is not a survey of marketers. Rightly so, because when it comes to establishig and utilizaing a data warehouse — whether for customer engagement or other operational needs — IT has a seat at the table. Especially at the enterprise table. And, let’s be honest, IT is going to have a louder voice than the marketing org.
Now look at those survey results again. If you’ve invested in a data warehouse, a composable CDP might well make more sense than a packaged CDP. It might also seem — to a techie — more attractive than several CDPs doing different things. (I’ve come across this while speaking to brands — two or three CDPs strung together because they’re each good at different things). Finally, is it the CMO or CTO calling out for predictive analytics, better security and better reporting?
Coming from MessageGears, this all makes sense. “Composable. End-to-end. Built for big brands.” That’s what it says on the MessageGears website and it makes sense that the buying team for such a solution is not going to be composed (that word again) exclusively of marketers.
Our takeaways
Here’s what I get from the report and from observing the space generally:
- Yes, composability is a key trend — in the enterprise and for organizations that have invested in data warehouses/lakes.
- It will appeal to large B2B enterprises where customer data is much broader than just marketing or sales data.
- It’s not yet ready to serve smaller organizations or leaner marketing teams that don’t need to tie their customer data to operational, financial or other data.
- Traditional CDPs are under pressure from a different direction anyway, namely from customer engagement platforms that emphasize real-time, personalized activation over storage and management of data.
On the latter point, no wonder MessageGears is positioning itself less as a composable CDP and more as an end-to-end alternative to both a CDP and a customer engagement platform with email, mobile and SMS messaging.
That may well be the future for CDPs, composable or not. “The creatures outside looked from CDP to customer engagement platform, and from customer engagement platform to CDP; but already it was impossible to say which was which.” Thanks, George Orwell.
The MessageGears report can be found here (registration required).
Dig deeper: What the composability revolution means for the martech stack
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