Record growth for CDPs in 2021
New CDPs split about evenly between startups and established vendors.
Customer data platforms have had a banner year in the first half of 2021, according to the latest report from the CDP Institute.
The CDP industry has ballooned to an estimated $1.6 billion in revenue, according to the report. This includes worldwide CDP product sales, as well as CDP components within marketing suites, message delivery systems and e-commerce platforms, but doesn’t include related services or in-house data development projects.
Some experts predict an increase in marketing budgets and hiring for the second half of the year. But marketers haven’t been wasting any time, boosting their tech stack with CDPs ahead of this big push.
As a result, CDP vendors have added 6% more employees in the first half of 2021, compared with 1% employment growth in the second half of last year. Investors are also bullish on this particular data technology, pumping 11% more venture funding into CDPs in 2021, while we saw only 3% funding growth in the second half of 2020.
New additions to the CDP space. Twenty new vendors have been added to this semi-annual report, bringing the total to 151. Most of them land in one of two clusters. First, there are the large, mature delivery CDPs, based outside the U.S., that average 90 employees and $50 million in funding. The other group are the small, new, data, analytics and campaign CDPs, located mostly within the U.S. and Europe, averaging nine employees and under $300K in funding.
For this first half of 2021, the industry also saw a record eight CDP acquisitions and mergers. Most buyers were customer engagement platforms that added a CDP to connect siloed components and multi-channel suites, according to the report.
Why we care. The CDP Institute saw an industry freeze in 2020, in the early stage of the pandemic, and this was understandable as businesses went into survival mode. The wait-and-see approach continues in some areas of marketing, like live events, as uneven vaccine rollouts and new variants complicate the pandemic recovery. Certainly we’ve all learned that the way forward in these challenging times is the digital way.
That’s where customers are, on mobile devices buying remotely, or making safe contactless (digitally enhanced) transactions in-store. The most successful marketers are the ones who can pull together the data from these various touchpoints, which continue to multiply. And that’s why it makes sense that more marketers are turning to unified data tools like CDPs to make the increased digital presence of customers more actionable.