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The hidden fees in your customer engagement platform

May 03, 2024

It starts with excitement and promise. A company invests in a customer engagement platform that appears to be a great fit for its cross-channel marketing needs. At first, everything seems well enough – teams are excited by the platform’s potential, the features look promising, and there’s a sense of confidence that they’ve made the right choice.

But then, the honeymoon period ends, and reality sets in. Despite the vendor’s promises, the marketing, data, and IT teams start facing a series of unexpected obstacles. It might be a longer and messier onboarding period than expected, service and support that suddenly becomes hands off now that the sales process is finished, or the sudden need for expensive add-ons to unlock features that seemed to be part of the original package. In other cases, key functionalities are just missing altogether, with no easy workaround in sight.

These setbacks are more than just annoying — they can derail your entire martech strategy and turn what seemed like a wise strategic investment into a sunk cost. The underlying problem is that many customer engagement platform providers aren’t transparent about the extra costs that will surface after you’ve signed the contract. And these costs add up quickly, jeopardizing your budget and objectives.

To help you navigate this tricky terrain, let’s explore some of the most common hidden fees associated with customer engagement platforms and discuss how to spot them before you commit.

The hidden costs of data storage

Customer engagement platforms rely heavily on data to function effectively – it drives insights, fuels marketing campaigns, and informs strategic decisions. This data encompasses everything from customer profiles and interaction histories to communication logs and more. While most platforms include a baseline level of data storage in their standard packages, it’s the hidden costs related to additional data storage that can catch you off guard.

These extra fees can have a ripple effect, impacting not only your team’s operating expenses but also your ability to scale marketing and data strategies. In some cases, data teams are forced to limit data collection or even delete valuable data points to avoid the extra costs.

The challenge is that many platforms impose a cap on the amount of data you can store in them without triggering additional charges. Once you exceed this limit, the extra fees accumulate rapidly, creating a variable expense that’s hard to predict and manage.

Duplicate data

 

One of the more frustrating aspects of traditional CEPs is their requirement for brands to store their data within their platform, even when brands already maintain their own data warehouse or centralized repository elsewhere. This redundancy leads to brands paying twice for the same data storage: once for their internal infrastructure and again within their customer engagement platform.

Platform limitations

 

But why does this happen? Brands are ultimately paying for the technical limitations of CEPs in how they manage and store customer data. Because they lack the infrastructure to directly access the data stored in a company’s data warehouse, they require you to import data into their ecosystem.

This forces brands to unnecessarily move, copy, and store their data outside of the secure environment of their data warehouse. Not only does this incur additional costs, but it results in data inaccuracies, duplication, and security compromisations. 

 

💡 Solving for data storage costs

Suddenly, a platform that seemed affordable initially becomes a source of unexpected expenses, forcing brands to scale back and rethink their customer data strategies. 

The good news is that knowing about these hidden costs means you can take proactive steps to avoid them. When considering a CEP, look for a solution that won’t restrict how you use your data. MessageGears, for example, connects directly to your data warehouse, eliminating the need to copy or move your data at all. MessageGears never stores your data, so you don’t need to worry about extra add-on charges as your data grows in volume or complexity.

Additional costs as you scale

Many CEP vendors have been criticized for their steep price creeps and reluctance to inform brands that as their data, campaign, and personalization requirements grow, so does the cost — and quite rapidly.

By the time you realize these unexpected jumps in pricing, it can be too late – you’re locked into a multi-year contract with limited flexibility. At this point, you face two options: incur the additional fees or limit your campaign sophistication.

Data-point charges

 

The main reason for these cost surges is data-point capping. In this context, a data point refers to any unit of information, such as a record of a user’s interaction, an email open, a page view, a purchase, or any piece of customer data — as well as changes in user profiles or transitions to another segment.

Most platforms offer a pre-defined limit on data points within their pricing tiers. The problem is that this limit isn’t always clear at the start, leaving brands in the dark until they hit the cap. As your brand grows, the number of data points naturally increases. New customers, ongoing campaigns, and continuous interactions all contribute to the growing data volume. When you reach that invisible limit, platforms start charging extra. This kind of scaling fee can be challenging to predict, making it difficult for marketing and data teams to plan their budgets accurately.

For brands experiencing a growth phase, the impact of these limits can lead to significant costs. If costs are rising in proportion to customer engagement efforts, it can force tough decisions about scaling back campaigns, reducing customer interactions, or even choosing between the events you’ll collect to avoid excessive charges. No brand wants to make those kinds of compromises, especially when they’re trying to grow.

 

💡 Solving for data-point charges

To navigate these hidden fees, brands should fully understand vendor agreements and pricing structures before committing. Data teams should be involved in the process from the beginning so they can determine how costs might increase as you scale.

With a platform like MessageGears, you don’t have to worry about the usual data scaling costs because we access your data directly from your data warehouse. This means you’ll never have to limit what you do with your data or worry about storage costs piling up. Since we don’t store, copy, or sync your data, it stays within your secure environment, safely behind your firewall. All the capabilities you have in your data warehouse are available to you through MessageGears because we simply activate your rich customer data right at its source. This approach eliminates data scaling costs, data usage limitations, and those dreaded unexpected surprises.

Bolt-on solutions

Traditional CEPs require bolt-on solutions and additional technology to get the most out of the platform, access your data, and accommodate real-time personalization. Bolt-on solutions are extra modules, tools, or services that aren’t included in the basic package of your customer engagement platform. They range from additional analytics tools, advanced segmentation capabilities, integration with other software, or extra communication channels. Essentially, they’re features you might expect to be included, but require additional payment to access.

Missing capabilities

 

A common example, especially for enterprise brands, is when the CEP lacks seamless integration with the data warehouse. Many large consumer brands use a data warehouse to centralize customer information, ensuring all data remains accurate, reliable, secure, and actionable. When a CEP can’t integrate directly with the data warehouse, it limits the platform’s capabilities, requiring even more tools to bridge the gap.

To address this limitation, brands often turn to a data activation platform to connect their data warehouse to the CEP so they can activate their data for advanced personalization and analytics. While this can solve the immediate problem, it introduces new ones: yet another costly platform and added data complexity. 

Many brands accept these bolt-on solutions as the norm, believing it’s the only way to get the functionality they need. But there is a better way.

 

💡 Solving for bolt-on solutions

Solving for bolt-on solutions starts by acknowledging the limitations of the one-size-fits-all approach many CEPs take.

Rather than relying on bolt-ons to reach your desired capabilities, choose a platform that aligns with your infrastructure and can connect directly to your data warehouse without needing additional tools.

MessageGears, for instance, eliminates the need for data activation bolt-on solutions by connecting directly to your data warehouse. By choosing a platform that doesn’t rely on additional technology to achieve its full capabilities, you can focus on using the full potential of your data without worrying about hidden costs or complex integrations.

Avoiding the hidden costs of CEPs

Navigating the complexities of customer engagement platforms can be daunting, especially when hidden costs and unexpected limitations are lurking beneath the surface. From data storage fees to bolt-on solutions and scaling costs, these unseen expenses can quickly turn a promising platform into a financial headache.

By understanding these potential pitfalls and taking proactive steps to avoid them, you can ensure your customer data strategy stays on track.

To avoid hidden costs, choose a platform that prioritizes transparency, flexibility, and your brand’s growth. With a warehouse-native CEP like MessageGears, you get fully transparent pricing and never have to worry about hidden costs. MessageGears has no data storage or usage restrictions, so you can scale without ever encountering unexpected fees. Our platform is built around supporting your growth without limiting anything you do with your data and keeping it within the secure environment behind your firewall.

If you’re interested in learning more, our data solution experts are ready to show you how MessageGears is different from every other CEP on the market. Reach out to discover how we can help you build a cost-effective, secure, and scalable customer data strategy.

About the Author
Sarah is looking at the camera and smiling. She is a young white woman with long blond hair, wearing a black turtleneck.

Sarah Kelly

Sarah is a passionate marketing professional devoted to crafting thought-provoking content that fuels business growth and success. With over a decade of experience in the ever-evolving marketing world, she brings a strategic and data-driven mindset to her role as SEO.