Composable vs Packaged Approach for Building a CDP

What’s up folks, today we’re extremely privileged to be joined by David Chan, Managing Director at Deloitte Digital.

Summary: Keep a keen eye on the modular evolution of CDPs. Know that reverse ETL tools are tactical additions, not replacements. Expect to reevaluate the roles of older platforms in your martech stack as CDPs get smarter. And if your organization's data strategy resembles more of a herding cats scenario than a well-oiled machine, maybe it's time to look into that dual-zone approach. It's a way to make sure everyone from your IT folks to your marketing creatives are playing from the same strategic playbook.

About David

• David started his journey with PepsiCo as a Data Strategy Analyst and progressed to a Senior Associate role at Accenture Interactive
• He then joined Deloitte Digital as a Senior Consultant where he worked his way up to Managing Director, leading their CDP practice and focusing on Marketing Transformation and Operations
• He possesses extensive knowledge in crafting real-time personalization strategies, blending Identity Resolution, Customer Data Platforms (CDP), AI/Machine Learning, Dynamic Content, and their interplay within the broader martech ecosystem
• At Deloitte, David also works with product engineering teams to develop assets using tech platforms like AWS, Snowflake, Adobe, Salesforce and many others.

From Web Analytics to CDPs: David's Evolution in Martech

When asked about his journey into the world of Customer Data Platforms (CDPs) and martech, David candidly revealed that CDPs were nowhere on his radar back in 2010. Those were the days when conversations in the marketing tech space revolved around web analytics, content management, and commerce systems. No one was losing sleep over data management; instead, the questions on everyone's lips were about the promise of mobile apps. Is mobile going to be a big deal? Will people actually shop on a tiny screen?

David noted that his professional background was solidly rooted in digital marketing, with a focus on areas like web analytics and content management. He didn't venture into the data-centric world of CDPs until about five years ago. The pivot happened when Deloitte, where David was employed, made a strategic acquisition. For the first time, they brought a company into the fold that specialized in data and analytics, a capability entirely new to Deloitte's existing services. It was this event that nudged David to start integrating this newfound expertise into Deloitte's broader service portfolio.

He shared that this acquisition was a sort of aha moment for him, leading him to delve deeper into the CDP arena. Before this, the martech issues that were top of mind for him and the industry were focused elsewhere. Now, with this new role, David began to consider how to marry data and analytics capabilities with existing digital marketing services. His career took a turn, opening up new avenues and challenges.

At this point, David's journey becomes a testament to how quickly martech can pivot and evolve, but also a case study on the necessity of adaptability in one's career. David’s path shows that sometimes, the most significant career shifts happen when you're willing to integrate new, emerging components into your existing skill set.

Key Takeaway: David's shift from web analytics to CDPs didn’t happen overnight but was catalyzed by a crucial acquisition at Deloitte. His career trajectory illustrates that being open to new opportunities, especially those that are tangential to your existing expertise, can make all the difference.

The Future Isn't Unbundled, It's Composable: David's Take on CDPs

When asked about his unique take on the future of CDPs, particularly as articulated in his article responding to claims that "CDPs are dead," David drew parallels to his earlier experiences in the world of commerce. According to him, before one could even talk about a composable CDP, it's crucial to understand headless commerce. Back around 2013-2015, headless commerce decoupled web content management from the more intricate logic of commerce tools. In simpler terms, the pretty face of the website was one tool; the behind-the-scenes grunt work of product listings and checkouts was another.

David noted that this breaking apart into components wasn't just a neat trick—it was an evolution seen in various technologies, especially commerce. Fast-forward to CDPs today, and there's a glaring issue. While commerce tools have achieved a kind of "modular maturity," CDPs lag behind. The tools exist, but how they should integrate is still a murky question. There's no established standard or framework yet that guides how these diverse tools and features should come together in a seamless, unified way.

He went on to clarify that this lack of standardization in the CDP landscape is what makes an unbundled approach impractical, for now. In contrast, the commerce space went through a period of consolidation and standardization that made headless systems not just possible but effective. The CDP space is in its infancy when it comes to this level of system integration.

It's like trying to assemble a puzzle when half the pieces aren't just missing; they haven't even been made yet. David’s outlook? We're not there yet, and no, his stance hasn't changed. There's a future where CDPs are as composable as lego sets, but the industry needs more time to harden its thoughts, develop standards, and agree on frameworks.

Key Takeaway: The future of CDPs isn't about scrapping the concept, but refining it. The industry needs time to mature and adopt standards for how disparate CDP components should integrate seamlessly, much like what has happened in the commerce space. Until then, declaring CDPs dead is a bit premature.

Why Composability Wins: The Power of Choice in CDPs

When asked about the top benefit of choosing a composable route for CDPs, David cut to the chase: it's all about choice. Imagine subscribing to a cable package with hundreds of channels when you only watch a handful. You get stuck with a bunch of extras you don't really need. David likens this to package CDPs, which come pre-bundled with an array of features that may not align with individual business needs. Sure, the package deal may look appealing on the surface, but dig deeper and you find yourself with components that are more noise than signal.

The compelling thing about composability is it allows companies to choose only what they actually need. This isn't just about being picky; it's about optimizing performance and cutting down on excess baggage. Yet, David also added a word of caution: composability isn't some magic elixir. As the industry is still in the early stages of this journey, composability can offer either the "best of both worlds" or the "worst of both worlds." In other words, you can cherry-pick the best elements, but if you're not cautious, you might end up with a mishmash of incompatible parts.

Companies should keep in mind that the CDP landscape is still maturing. For now, the fully composable CDP is like a chef's tasting menu that's still in development. Sure, some dishes are ready to serve, but others need more time to cook to perfection.

So where does this leave us? David’s take is clear: the path to fully composable CDPs is an ongoing journey, one that requires both caution and a bit of adventurous spirit. And, crucially, more time.

Key Takeaway: Composability in CDPs offers the critical advantage of choice. Yet, with the industry still in its infancy, that choice comes with a responsibility to be cautious. Your tech stack can be a well-curated collection of best-in-class tools or a disorganized j...