Announcing The CDP Report 2023: customer data platforms enter the mainstream

Today, we’re excited to share the findings of our fourth annual Customer Data Platform Report, our yearly deep-dive into how customer data is powering customer engagement across the world.

In recent years, there’s been a cross-industry consensus that “data is the new capital.” It’s a prerequisite for personalization, product development, machine learning – the list goes on. 

And as the world continues to embrace our new digital-first era – at breakneck speed, in part, due to Covid-19 – the sheer amount of data being created has skyrocketed. In fact, this year's report shows data volume hit an all-time high in 2022, with a record 11.7 trillion API calls on the Twilio Segment platform.

This exponential increase in the volume and complexity of customer data has thrust customer data platforms into the limelight. What was once a "nice to have" technology has become a cornerstone of the modern technology stack.

Despite unfavourable economic outlooks, and technology budgets under pressure, this year's report illustrates how and why many businesses are continuing to invest in their customer data infrastructure.

Here are a few of our findings.

Businesses are getting more efficient about what data they collect

As the days of “growth at all costs” come to an end, businesses are becoming laser focused on operational efficiency, which is having downstream effects on how they collect and process customer data

Over the past 12 months, we’ve seen our customers get smarter about which data is collected, a reflection of the economic circumstances businesses now find themselves in.

For example, Twilio Segment recently developed a strategy with one customer after discovering that they were tracking hundreds of repeat events, and sending data to multiple redundant destinations. By making two simple recommended changes to their workspace, the customer saved 1.6 billion API calls per month, saving them valuable time and money by collecting and activating data more effectively.

Enterprise solutions show resiliency, but smaller players show rapid growth

Aside from collecting data from all digital touchpoints, Twilio Segment helps our customers connect that data to over 400 different apps.

The most popular apps on the Segment platform are household names like Google Analytics (used by 67% of Twilio Segment customers), Mixpanel (51%), and Facebook Pixel (41%), but in 2022, the fastest-growing app was June, a product analytics tool, posting 83% year-over-year growth.

Other solutions like Algolia (66% YoY growth), a search and discovery platform, and customer success software Vitally (45% YoY growth) also rank among the fastest growing.

With API-driven platforms like Segment enabling integration at close to zero cost, it’s more feasible than ever for companies to explore and use new apps alongside their larger vendors. In an era of economic uncertainty and budget cuts, this shows that there’s still a lot of opportunity for specialized solutions that meet business-critical needs.

Data warehouses are surging in popularity

Last year, our report showed explosive demand for advertising apps on the Segment platform, as it rose to become the #2 most popular app category. This year, while the numbers show a close race, warehouses have retaken the silver medal from advertising as the second most popular category on our platform.

As a matter of fact, 53% of Twilio Segment customers now connect to a warehouse destination.

Using a CDP with a data warehouse ensures that non-technical teams have access to real-time data, without depending on data engineers. This allows organizations to create a comprehensive and accurate view of their customers while enabling their marketing and data teams to work directly on the data they rely on already, activating it within the systems they already use.

Consumers are taking privacy more seriously than ever before

Headline-grabbing data breaches and global regulations have pushed privacy to the forefront of consumer awareness, giving businesses worldwide the opportunity to rethink their practices around customer data.

In response, businesses have adopted the privacy features available in Twilio Segment in ever increasing numbers, specifically features that allow them to process user deletion requests for personal data in compliance with data privacy regulations like GDPR, Schrems II, or CCPA. 

In 2022, our platform successfully processed over 23 million user deletion requests on the Twilio Segment platform, a 69% increase over the year prior.

Our report covers all of the above and much more, and reinforces a drum we’ve been beating for over a decade: that CDPs are the mission-critical piece of infrastructure for any digital-first business in 2023.

Head this way to read the report in full.