Worlds Collide: The Head-on Crash of CDPs and ESPs

Any discussion of the features and functionality of ESPs vs. CDPs needs to start with the ESP platforms. ESPs have been around in one form or another for over 20 years, and it should be well-estalbished these days as to what constitutes an ESP. Ah, if only it were so easy. Fun Fact: there are much bigger differences between email vendors than most email marketers realize.

These differences are rarely addressed in detail by analysts like Forrester—who rank everyone together in a single ESP wave report, and then turn around and rank many of the same players in a CCCM wave report. And the vendors are no better, with sales teams who never met a prospect for which their platforms aren’t a perfect fit! Making matters even more confusing for the poor email marketer is the fact that most vendors don’t even call themselves ESPs any longer! It’s almost as if there is a stigma associated with those 3 letters. And yet in truth, no one runs an RFP for a “Growth Marketing Platform.” They run RFPs for Email Services Providers. And that’s as it should be, since email marketing is what is, and what should be, driving the decision process in these RFPs.

The ESP Landscape

Today’s ESP vendor landscape can be organized into 5 distinct categories, each with different approaches to technology, services, and priorities. Let’s take a look at each of these groups in more detail…

Marketing Service Providers

• Examples: Zeta Global, Epsilon
• 5 years ago this group was the dominant category of ESP
• Traditionally services-oriented, including creative and analytics, on top of campaign production; can provide clients with full-service relationships
• Deep understanding of data and database marketing; able to ingest and leverage large volumes of data

These ESPs are best suited for enterprise brands that want to store large volumes of structured and unstructured data in their ESP; brands that want access to a broad range of agency services from their email vendor; and brands interested in 3^rd party data appends to their email databases.

Marketing Clouds

• Examples: Salesforce, Adobe, Oracle
• These email platforms are parts of larger, integrated suites of marketing tools offered by the providers
• Parent companies see themselves as technology companies, not marketing companies, so they don’t offer a range of services—instead they depend on third-party agencies to provide services to their clients
• Continue to acquire niche vendors with dynamic personalization offerings, data tools and assets, and predictive analytics capabilities

These platforms are best suited for enterprise brands already heavily invested in a parent company’s marketing cloud products. They are not ideal vendors in an email point solution role.

Transactional

• Examples: SendGrid, Sparkpost, Pepipost
• Officially known as Email API and SMTP transactional email services. Also known as “MTA’s in the Cloud” (credit David Daniels, The Relevancy Group)
• Bare-bones platforms, bare-bones services and support
• Designed for developers and IT with easy to integrate and extensive API’s; rudimentary UX tools for promotional emails

Best suited today for brands sending large volumes of transactional emails (i.e. one-off emails sent in real-time based on some type of event). Brand marketers often struggle with these platforms when setting up and mailing promotional (or batch) email campaigns.

Point Solutions

• Examples: Sailthru, Emarsys, dotdigital
• As in the martech category in general, the email point solutions category remains highly fragmented and is continuously evolving in multiple directions, resulting in rapid vendor proliferation and brutal competition
• Many of today’s key players in this category got their start in Europe, and were built from the ground up as multichannel solutions

Best suited for mid-market and low enterprise email marketers who are multichannel marketers.

Unicorns

• Examples: Iterable, MessageGears, Braze
• Unique platforms with specialized capabilities around particular needs like mobile first, UX enhancement or data management

In the right situations, these ESPs can help solve seemingly intractable problems. Unicorns often don’t have direct competitors in the market; evaluating them in any RFP process requires a deep understanding of the differences they represent.

The CDP Landscape

So now that you have a better understanding of the ESP market, one might think you’d be all set. But that’s not how life works. Once again, a “next big thing” has come along and now email marketers like yourself are being told that your stack isn’t complete without a CDP. Why does this keep happening?!

Because we’ve been fed hyperbole like this about customers for 20 years from the “experts:”

Consumers increasingly expect real-time, personalized customer experiences—experiences that seamlessly blend the lines between different channels and departments.

And the “next big thing” always promises to…

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