What is Customer Data Management? Meaning, Benefits & Risks

, 19-Dec-2023

In the current scenario, every customer is hooked to the web, thus customer data plays a crucial role. Customer data is any information collected and leveraged by business brands about the customers. It is an essential asset for understanding customers & their goals. The business brands target potential customers and sell their data to third parties for revenue generation. In this article by uEngage, we will walk you through What is Customer Data Management? Meaning, Benefits & Risks.

What Is Customer Data Management | Explained by uEngage

Customer Data Management or CDM refers to the process of gathering, managing, and analyzing the customer data collected from different sources to fabricate a better-amalgamated view of consumers. This approach is adopted by businesses to effectively and efficiently manage their consumer data. Further, it allows businesses to gather data from several different sources and get to know who their customers are.

This digital age is of constant customer connectivity, so customer data analytics tell us how the customer reacts to various tactics so the organization can improve its products and services. Business Brands acquire customer data via recording historical purchase transactions, customer support communication data, web analytics, website cookies, and social media activities. Through this article, uEngage is going to take your through What is Customer Data Management? Meaning, Benefits & Risks.

Why Businesses Need to Prioritize Customer Data Management

With the changing times, expectations of the consumers are also changing. The transforming expectations of the customers force businesses to level up consumers now expect businesses to provide meaningful personalization. Customer Data Management allows the business to provide personalized and real business solutions to the consumers. Here are the reasons that shows Why Businesses Need to Prioritize Customer Data Management:

  1. The emphasis of business now lies on traveling away from generalized, persona-centric personalization and getting inclined more toward a better-targeted approach using Personally Identifiable Information (PII).
  2. The pivot is evident, moving from reliance on third-party data to prioritizing first-party data. businesses recognize the substantial value in basic multi-channel customer interactions, yielding a rich repository of customer and prospect data.
  3. Transitioning from ad tech-fueled personalization to marketing technology-driven personalization marks a significant evolution. Gone are the days when ad targeting and retargeting relied on Data Management Platform (DMP) persona segments as the sole solution. In today's landscape, Marketing Technology is tasked with personalizing every facet, from website content to real-time adjustments in email marketing.

Types Of Customer Data

Now, that we know What is Customer Data Management, it's time to learn about its types. Customer Data can be distributed in many ways. There are different types of customer data and knowing about each of them is crucial to perform analytics and understanding the trends prevailing in the market. Here are the types of Customer Data:

Descriptive Data: It includes the basic identity data of customers, including name, phone number, email address, gender, LinkedIn profile, income, etc. It also includes customer demographics, which can be used later for customer segmentation or grouping customers based on shared attributes.

Interactive Data: It includes how customers or potential customers interact with the brand across various areas, e.g. how customers are engaging with the e-commerce websites and how often they like/share your posts on social media. It is usually applied at a macro level and highlights click-through rates or how many shares the brands are getting on social media. Interactive data is particularly useful for informing decisions about the customer’s journey. Interactive data in web analytics is often studied in detail by marketing consultants to understand campaign effectiveness.

What is Customer Data Management? Meaning, Benefits & Risks

Behavioural Data: Behavioural Data offers insight into the customer’s experience with the actual product or service.   It is often confused with interactive data, but there is a key difference between the two, behavioural data focuses more on the way a customer interacts with the service or product the business offers directly. It includes actions like purchase history, abandoned shopping carts, and renewing subscriptions. Tech companies are often cited as prime users of behavioural data, such as free trial sign-ups, user account logins, feature utilization, user license additions, deactivations, etc. Behavioural Data helps to understand customer preferences & identify future trends.

Attitudinal Data: Attitudinal Data helps to understand what customers actually think about the business brand and the solutions provided by them. While the previous types of data are more objective, attitudinal data is subjective, where the data provided by customers is a first-hand opinion about what customers think about your brand, product, or service. It can be collected through online reviews, surveys, forums, and feedback interactions with customer service. But the attitudinal data is harder to access because every customer does not share their opinion in the same way & at the same volume. That is why consistent & proactive collection of attitudinal data from a statistically significant group of customers is the key.

How To Build The Customer Database

After learning about What is Customer Data Management, its time to learn how to build a customer database. A customer database can be built via aptly executing customer data management. Customer data management is how business brands keep track of the information they collect about customers. It includes collecting, analyzing, organizing, & sharing customer insights throughout the organization. Customer Data management helps generate leads, build better customer relationships, & close deals. While building the customer database, the following points should be kept in mind:

  1. Segmenting customers as per their preferences sends them the right messages and involves them in proper campaigns.
  2. Using programmatic advertising and website visitor tracking to retarget the customers
  3. Targeting the customers by Google Ads.
  4. Creating dynamic content via content marketing strategies so that the content on web pages & emails can be changed automatically according to the buyer persona, past digital activities, & other data points
  5. Investing in reengagement reminders and push notifications to retarget the customers based on their inactivity, thus enticing them to reengage with the tool.
  6. Creating value content for target customers using heat maps
  7. Using CRM (customer relationship management), CDP (customer data platform), and DMP (data management platform) to organize data
  8. Using web forms for gated content is vital. It is important to install & optimize them on the business brand’s website.
  9. Using tools and strategies such as business intelligence tools, CRM software, market research, attribute modeling, website analytics, and competitor analysis
  10. Gathering customer data at the point of sale is important, as a lot of valuable information can be gathered at this time.
  11. Using email marketing strategies like giveaways, discounts, and competitions to engage customers and collect their dataWhat is Customer Data Management? Meaning, Benefits & Risks

How To Leverage Customer Data To Boost Business 

Besides What is Customer Data Mangement, another crucial thing to  know is How to leverage customer data to boost business. In today’s scenario, businesses that do not personalize customer experiences face a hard time competing in their respective industries. The digital world is flooded with data; therefore, it is important to segregate & organize the useful data. To achieve this, the strategies & techniques helpful in leveraging the customer data are listed below:

  1. Increase conversion, target customers, and invest in the most effective channels to improve customer acquisition.
  2. Analyse data from marketing and business management tools & monitor the performance of different products.
  3. Incorporate site-wide tagging to track conversions.
  4. Observe customer behaviour and purchasing habits, and follow fluctuation in numbers.
  5. Build dashboards to track and visualize data conveniently.
  6. Collaborate on solutions to Customers’ problems.
  7. Evaluate propensity to buy & market trends through logistics.
  8. Guide content production via heat maps, and web visitor tracking to determine which content leads & customers visit.
  9. Leverage customers for feedback by starting a referral program to get a positive social media reputation.
  10. Track financial sales & map customers’ journeys.
  11. Build customer-centric value, shift from sales mindset to benefit consumers.
  12. Build amazing campaigns.
  13. Use the right tools & a good CRM system.
  14. Capitalize customer data, and personalize it.
  15. Customer Data can be leveraged using tools like Salesforce, Oracle, Hubspot, and CRM.

Also Read: What is Customer Marketing Automation?

What Are The Benefits Of Data-Driven Decision-Making

Data-driven decision-making is the process of using data to inform your decision-making process & validate a course of action before committing to it. From the above content, we have realized the awesome power of data. Digital Marketing relies heavily on data for optimization and reducing customer acquisition costs. To quote Winston Churchill,” Think of data collection as your geese that lay the golden eggs.”

What is Customer Data Management? Meaning, Benefits & Risks

Leveraging the customer data acquired in the right way can transform business growth to a great extent. The benefits are listed below:

  1. Using data to generate revenue, increases profit & reduces customer acquisition costs.
  2. Using key data for all the major decision-making processes helps a business achieve consistent results.
  3. Minimizes bias as every decision is made logically after analysing the customer data.
  4. Data-driven decision-making brings agility & adaptability to the business as per the changing market trends.
  5. Regionalizes  brand products as per customer requirements
  6. Improvises problem-solving and customer relationships.
  7. Improves lead generation, customer acquisition & customer retention.
  8. Helps create custom dashboards to study the patterns of customer choices.
  9. Huge volumes of data collected by the data-driven organisations, help to spot patterns in customer choices, thus aiding the business to modify its products & services accordingly.
  10. Improves transparency & awareness throughout the business as the same information is available throughout the organisation which prevents any miscommunication.

What Are The Risks In Managing Customer Data

As customer data is becoming more valuable, the customers are becoming more concerned about how their info is used. Data protection Regulations along with industry-specific data security requirements are becoming commonplace in our data-centric economy to avoid the risks in managing customer data. Hence, understanding security risks & implementing safeguards to protect customer information are key steps for any business brand that wishes to make the best use of the customer data.

What is Customer Data Management? Meaning, Benefits & Risks

In addition to this, maintaining clean data is very important. However, without the right systems & processes, faulty data will become a familiar reality. To keep data clean, implement proactive data deduplication measures, keep the staff well trained, & look for opportunities to eliminate manual data entry.

Try the Best Customer Marketing Automation Platform | uEngage Prism

It is the need of the hour to leverage customer data for internal usage as well as for interested third parties. If you are looking for an all-in-one solution to customer data management for your business brand, then the Best Customer Marketing Automation Platform, uEngage Prism is the right choice for you.

uEngage Prism provides a CRM platform for restaurants, cloud kitchens, breweries & cafés, cashless campuses, D2C brands & for salons to manage & book appointments. With Uengage Prism, you can connect & engage with customers via automated marketing campaigns. It helps in leveraging the customer data in   a way that boosts sales by providing the following features:

  1. End–to–end customer data covering minute details.
  2. Real-time data availability ensures quick access to customer data.
  3. Manage campaigns via SMS or push notifications.
  4. The audience is divided into micro-segments which can be targeted over time, making them order again.
  5. Fetch data directly from your POS system.
  6. Simplified guest accommodation process with a digital entry system.


So, this is all about What is Customer Data Management? Meaning, Benefits, & Risks. Leveraging customer data management for business growth is one of the key digital marketing strategies to boost business apart from SEO, site audit, etc. But there are many challenges to overcome e.g. analysis time is spent just on discovering and preparing data that needs an effective use of CRM software. So, if you are in search for a relaible platform for customer data management for your restaurant, then try uEngage. Contact us to know more.

Uengage Prism provides an all-in-one Customer Marketing Automation Platform to the business brands to retain their customers, target the potential customers & retarget the inactive customers hence by , helping the business brands increase their revenue & profits.

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