A data management platform (DMP) is a software as a service (SaaS) platform designed to collect, organize and help “activate” anonymous data (using data from online, offline and mobile sources), to be used for personalization in marketing and advertising campaigns.
Which tools, platforms and data technologies do you really need in your martech stack today? With so many solutions (and endless acronyms!) in the data-driven marketing landscape, it can be hard to know where to begin.
So let’s start by outlining the most data-driven marketers’ goal: unlocking the right data ecosystem and technologies to collate, manage and activate data to give insight into creating personalized, omnichannel campaigns and great customer experiences.
But from DMPs to customer data platforms (CDPs), to marketing analytics environments – there are a lot of different tools to understand. And, not every tool is relevant to every use case – a DMP or CDP may not always be the right fit for your goals.
So let’s explore exactly what a DMP is – and key considerations to help evaluate if it’s the right tech solution for your data-driven needs.
What is a Data Management Platform (DMP?)
At a high level, we describe a DMP as:
“A SaaS platform that collects, organizes and facilitates the ‘activation’ of ‘anonymous’ data for personalization and marketing and advertising campaigns using data from online, offline and mobile sources.”
As such, the services that a DMP typically offers can be split across three main areas:
Ingest / Collate
A DMP helps collect and consolidate disparate first-, second- and third-party data from across devices and channels, and anonymize it.
Illuminate / Organize
Once the right data is in the platform, DMPs help organize that data into a taxonomy of characteristics to make sense of varied user events and behaviors. They also work to provide wider insights, powered by first-, second- and third-party data relationships.
Finally, DMPs can help activate that collated, organized data. Using Boolean logic, a DMP helps build audience segments to enable marketers to reach current and desired customers and transmit to all available DSPs, DCO and SSP vendors, search, social channels and more.
In this sense, a DMP can be considered as a platform that brings together online and offline customer data and holds it in one organized place where it can be used for personalization, advertising and segmentation.
Sounds simple, right?
However, a DMP is not a “one-size-fits-all” solution, and it’s important that data-driven marketers understand when and where they can offer the advantage before investing in a DMP.
To drive full potential – and deliver return – a DMP should be fully evaluated, correctly implemented across the business, optimized, and (crucially) must be supported by the right data foundation.
2 / How Data Management Platforms Work
Understanding the key features and specific applications of DMPs can help clarify if they are a good fit for your requirements.
A DMP is an audience-focused solution that helps marketers collate, manage and house first-, second- and third-party data to create target audiences and use that insight to launch, analyze and optimize campaigns.
But, keep in mind that marketers may need more than a DMP to achieve their full omnichannel marketing goals and create a seamless data ecosystem.
|Enables:||But Does Not:|
|Activation of data to any digital channel||Include a DSP (Demand-Side Ad Platform); DMPs should be media-agnostic|
|Offline to online data onboarding||Only serve as a tag manager – they also ingest server-to-server data|
|Tag management – and beyond; DMPs also ingest server-to-server data||Only serve as an analytics and data warehouse – they go beyond, also activating data|
|Taxonomy management||Act as a closed ecosystem|
|Third-party data marketplace||Only manage cookies – DMPs manage data across multiple IDs, devices and channels|
|Audience insights and wider marketing intelligence||Only act as software – they also provide marketing intelligence|
|Lookalike modeling engine to identify audiences|
|Identity management across devices|
|“Bring Your Own ID” (BYOI)|
|“Data out” sharing to other platforms and environment within marketing ecosystem|
In light of all this, a DMP may be a good solution for organizations that are looking for an audience-focused data platform or perhaps want to use data to create and discover target audiences or lookalike audiences, and use data insight to launch, analyze, optimize campaigns, retarget and more.
How do DMPs work? Understanding DMP Architecture
At a high level, a DMP works to ingest or collect, organize and illuminate and then activate or facilitate anonymous data for personalization and marketing and advertising campaigns using data from online, offline and mobile sources.
But what does a DMP architecture look like in more detail? How does a DMP work to collate, organize and activate that data?
To effectively aggregate and activate data, a DMP must first be fed and supported by an effective data foundation. Flowing in, a DMP needs both online and offline data:
- Online data: This may come from a range of sources, including mobile apps, websites, media, analytics and more.
- Offline data: This may come from the CRM system, email, purchases, etc., and should be supported by an effective data onboarding solution before flowing into the DMP.
Housing and organizing that first-, second- and third-party data, the DMP can then output a number of insights that can be used to create audiences and launch, analyze and optimize campaigns. Key data output from a DMP can be used to support:
- Display advertising campaigns
- Video campaigns
- Site-side optimization
- Dynamic creative optimization
Supported by the right data, and running effectively, a DMP can also support a continuous flywheel of success. As we can see below, the insights and intelligence a DMP outputs can be used to support a more connected, unified data ecosystem, which helps create enhanced, personalized customer experiences — creating happier, more loyal customers and a greater volume of relevant audience data that flows back into the DMP.
3 / Why Use a DMP?
Now that we’ve outlined what a DMP is, and what it can – and can’t – do, let’s look at key use cases that DMPs can help address. Why use a DMP?
Data management platforms are required to turn varied insights into effective actions. Yet DMPs can be complex. In a quickly evolving market, solutions are varied and ever-changing; different DMPs can enable differing capabilities, and many are now comprehensive audience platforms that support the bridge between the CRM and digital, offline and online worlds.
Therefore, choosing the correct DMP ultimately depends on why you want to use one (your key business objectives), but also your marketing position. Are you planning to use a DMP on the media sell or buy side?
Why Use a DMP? Advertiser Side DMPs
For organizations on the advertising side, a DMP’s value is in being able to use data insight to inform purchases and enhance ROI. DMPs used here must be able to make the most of valuable offline data assets (such as prospect or customer databases), be able to combine it with other data sources (online first-party data and a range of third-party data), and enrich and expand reach through lookalike modelling capabilities.
Why Use a DMP? Publisher Side DMPs
For organizations on the publishing side, the requirement is in having access to the data (typically online first-party web navigation data) to make the most of advertising revenue.
DMPs used here must be able to capture this data – which is typically anonymous and unstructured – and transform it into actionable segment insight; for example, recording insight into online behavior, then segmenting audiences accordingly.
Other Considerations When Using a DMP
Other considerations to make when considering a DMP, aside from buy or sell capabilities and insight, center around distribution capabilities. Consider:
- Do you need further distribution beyond programmatic display? Programmatic advertising is a core of many online campaigns. And while many DMPs focus on display primarily, this is only one channel; additional solutions may be needed for wider distribution.
- Can a DMP target a range of different channels? Is cross-channel targeting possible? Some more recent DMPs integrate premium display (direct buy) to enable cross-channel targeting via SMS, email, etc.
- Can a DMP provide true attribution? If a precisely targeted solution is required, make sure the DMP is comprehensive enough. Can the DMP take data from a range of sources (offline, online, first- and third-party, plus transactional data), all related to unique individuals, and use it for targeted action across a number of channels?
DMP Use Cases
Looking at initial DMP use cases, at a basic level, the platform enables a number of immediate uses. These “low-hanging fruit” use cases can be facilitated out of a DMP almost immediately, and include:
- Site and creative retargeting
- Audience discovery
Advanced DMP Use Cases
These are not the only use cases, however. With additional assembly, input from wider business decisioning, technical support and setup optimization, a DMP can be used to unlock more advanced use cases. These include:
- Look-a-like modeling
- A/B testing and personalization
- Product recommendations
- Site-side optimization (SSO)
- Dynamic creative optimization (DCO)
- Offline match
Note that support and consultation from an expert data partner can help you unlock the most from your unique DMP setup and wider tech stack, as well as your data ecosystem and strategy, to ensure all elements combine into the best optimized use case.
4 / Getting the Technology Right for Your Business Needs
Regardless of your data requirements, a DMP is not a stand-alone technology. It must sit alongside, support, and be supported by a number of other platforms to be truly optimized, such as the CMS, identity solutions. And it is critical that a DMP is supported by a strong data layer.
So how does a DMP fit within the wider data tech stack?
A DMP is fed by (and in turn informs) a number or sources, from web analytics to behavioral insights from the CMS and more. Because each platform in the stack supports the other, it is critical the insights and data flow between each is optimized. A martech stack is only as strong as its unification. Fragmented or siloed technology leads to gaps and incomplete insight; so understanding how and where to bridge platforms – and which platforms should be integrated in the technology stack – is critical.
An experienced data and martech partner can help identify which technologies are the best fit for individual use cases, and can help integrate or optimize existing or new technologies for best results.
Do I Need a DMP or a CDP?
Data-driven marketers need a wide range of varying capabilities from their martech; and it follows that different organizations will have different requirements.
Depending on an organization’s particular situation, data foundation and existing martech, a range of technologies may be needed to support full, omnichannel data-driven marketing — and those technologies may include a CDP, DMP and more.
Because DMPs (and CDPs each provide an element of data centralization within the data ecosystem, there can be confusion about which platform is the best fit.
So what’s the difference?
- A CDP works to aggregate customer data into a single customer database. At its core, a CDP is marketing software that works to centralize data from multiple sources, creating a unified customer database that other marketing systems can then use.
- A DMP is audience focused, helping marketers collate, manage and activate data. Ultimately, a DMP manages and aggregates digital audience data (cookies, online behavioral data, look-alike audiences, etc.) to enable audience creation, segmentation, analysis and optimization – and to provide the insight needed to launch, analyze and optimize campaigns.
Do I Need Other Technology Solutions?
Marketing databases, data warehouses … of course, there are many other platforms and technologies that can be combined with DMPs and CDPs that can enhance results. For example, an organization may need to incorporate more sophisticated identity resolution within a DMP or CDP to support the best data foundation.
It is critical to remember that a DMP is not a stand-alone solution. To operate effectively and deliver the best return, a platform should be supported by a sustainable data strategy and a unified data framework.
Before investing in a DMP solution, consider:
- Is a DMP the best solution for your use case? Does it align with your organization’s requirements, and does it include the necessary capabilities?
- Does your existing marketing technology align with your choice of DMP?
- Do you have the resources and expertise to implement the solution effectively?
- Do you have a data strategy in place to support optimal use of your DMP?
Acxiom’s Data Management & Marketing Database Solutions
Acxiom provides the experience to assess and establish a sustainable data strategy and a data management solutions suite to support data-driven solutions and solve enterprise-class data management needs.
Acxiom’s data management and marketing database solutions provide an enterprise-class foundation for unifying data and managing identity while helping brands activate key use cases that may require capabilities beyond those of a DMP or CDP.
Acxiom’s data management and marketing database solutions:
- Provide a foundation for closed-loop omnichannel marketing and advertising ecosystems.
- Bring together data from digital and offline channels to resolve identity across known and anonymous consumers.
- Enables marketers to address prospects and customers in a single solution, including closed-loop measurement and analytics.
- Provides a privacy-compliant data and identity management foundation that can be leveraged independently or in combination with DMPs.
- Facilitates an optimal evolution of a brand’s marketing stack, rather than a “rip and replace” approach.
- Is complemented with a wide breadth of professional services that support the integrated tool strategy across campaigns, analytics, reporting and day-to-day management.
Marketers must assess and weigh these factors to determine the best path to address the full spectrum of brand needs for unifying and activating data. This is why employing Acxiom’s experience and leveraging a unified data layer framework can provide a flexible foundation for a scalable, enterprise-class solution that meets the brand’s needs, whether or not those needs include the use of a DMP.