Data Management Platform (DMP)

A Data Management Platform or DMP, is a software tool used primarily in advertising and marketing to build profiles of anonymous individuals, store summary data about each individual, and share their data with advertising systems.

What is a Data Management Platform (DMP)

According to Digiday, “In simple terms, a DMP is a data warehouse, a piece of software that sucks up, sorts, and houses information and spits it out in a way that’s useful for marketers, publishers, and other businesses.” A data management platform is an execution hub where audiences are collected and marketing campaigns are launched, analyzed, and optimized. This happens through three steps:

• Aggregating Data: This type of platform imports and houses lots of information (the data). Primarily, they manage digital audience data like cookies, online behavioral data, and look-alike audiences. Most offline data (including your CRM, point-of-sale systems, subscription list, and third-party data providers) can be onboarded onto these platforms, but that requires external technology to do so—like an identity resolution provider.
• Audience segmentation: Segments are built from that data. These segments are the cornerstone of people-based marketing, allowing marketers to group people sharing certain characteristics and target each in specific ways.
• Analyzing and optimizing: After building segments, these platforms are able to manage and present all campaign activity and audience data based on those segments to help optimize present campaigns and establish best practices for future campaigns.

They help enable data-driven marketing strategies, which allow for effective targeting and unique messaging. These principles matter because the more a consumer believes that a company knows their needs and wants, the more likely they are to engage.

What a Data Management Platform Does

What you can do with all that data you collect? Here are just a few things you can focus on and what you can do with them:

• Audience targeting and targeted advertising: Specify your audience and target their interests and needs via video, visuals and content
• Content and product recommendations: Deliver personalized experiences for web and mobile users
• TV DMP: Match your audiences across TV & digital so you can reach the same audience when and where they are ready to buy
• Monetizing or selling data: Sell your valuable data for additional revenue
• Audience enrichment: Learn more about your audience, beyond what they do when they’re on your website or other properties.
• Grow your audience or customer base: Find a healthy supply of new customers to build brand loyalty
• Paid search: Use DMP-driven audiences to target, suppress or dynamically update paid search campaigns
• Paid social: Execute DMP-driven audience buys within social environments using Facebook and Twitter’s respective custom audience solutions

What a Data Management Platform Does Not Do

DMPs perform some of the same functions as other marketing technologies, like data analytics platforms, demand-side platforms or customer data platforms. However, there are important differences.

• DMPs don’t perform the same breadth and depth of analysis as stand-alone data analytics platforms because the technology only gathers certain kinds of data and only analyzes ad performance from digital channels.
• DMPs can’t operate ad campaigns on their own, either. They connect with demand-side, supply-side or media platforms, which serve the ads. In fact, DMPs are often embedded in solutions like marketing cloud platforms, adtech platforms or media ecosystems as one component of these larger platforms.

Given their strengths and limitations, DMPs can be a key tool to enable more targeted and personalized ad campaigns. Many marketers already have them in their technology mix — although some may not know it. Before considering a new investment, “Contact your digital marketing, media or other agency partners who may already be using a DMP on your behalf to understand whether it is being fully used,” says Eric Schmitt, Senior Director Analyst at Gartner.