What is Causal Analytics?

Causal analytics is a statistical method used to determine the cause-and-effect relationship between two variables. It involves analysing data to identify patterns, relationships, and correlations between variables, and then using this information to determine which variable is causing the other. This information is then used to make informed decisions about the business.

For example, if a business wants to determine the cause of a decline in sales, it can use causal analytics to analyse data to identify factors that are causing the decline. This could include things like changes in the market, changes in customer preferences, or changes in the competition. By identifying the cause of the decline in sales, the business can take steps to address the issue and improve its sales performance.

How does a CDP play a part in Causal Analytics?

As we know already, a Customer Data Platform (CDP) is a system that collects and stores customer data from various sources (helping to solve the data orchestration problem), such as social media, email, website, mobile apps, till register data and more. It is designed to provide a complete view of the customer by consolidating customer data from various sources, making it easier to analyse and identify patterns and relationships.

A CDP plays a crucial role in causal analytics because it allows businesses to connect, collect and analyse data from various sources to identify causal relationships which will help to make data-driven decisions. By collecting data from various sources, a CDP provides a complete view of the customer, which can be used to identify patterns and relationships between any two variables (cause/effect).

Using a CDP to orchestrate the flow of data from various sources, such as social media, email, website, and mobile apps, to identify patterns and relationships between variables and then going further to analyse the data whilst applying causal analytics, the business can determine which factors are causing the decline in sales and take steps to address and remedy the issue.

In addition to providing a complete view of the customer, a CDP also provides businesses with the ability to track customer behaviour over time. By tracking customer behaviour over time, businesses can identify changes in customer behaviour and use this information to make better data-driven (informed) decisions about the business and addressing its challenges and goals.

Still unsure of the benefits surrounding the application of causal analytics with a CDP and the value it can bring to your business to improve on its marketing goals? If so, we'd love to discuss the options further with you!