If you don’t have a Data Management Platform(DMP) or you don’t know what it is, that is understandable. DMP’s operate invisibly, but they are everywhere. If you use the internet for business of any sort, you need to understand what a DMP is and why it is crucial to marketing in the age of the internet.
A data management platform can help you better serve your current and future customers. This article will explain what a DMP is, what it does, and how it works with a demand-side platform (DSP).
What is a data management platform (DMP)
A data management platform is the service, product, or database that a company uses to store information about its customers. A DMP is more than a large spreadsheet with data about customers, though this is an essential concept from which to start.
The DMP collects almost any conceivable piece of data that can be gathered about a specific user on the internet. That includes a wealth of information that individuals and their web browsers give away freely, and some things that many people did not know were collected.
Companies gather and track a stunningly wide range of data. This type of data includes the keywords and search terms used, URLs visited, videos viewed, and items users have downloaded. There is other data available such as:
- Video completions (showing what holds a customer’s interest)
- Demographic data (showing the customer’s sex and age)
- Socio-economic data (showing the customer’s household annual income, and potential spending power)
- Cookie data (showing the customer’s browsing and buying habits)
Where does this information come from?
Every time anyone accessed the internet, their activity is monitored to some extent, and data is being gathered. This applies to activity from:
- Mobile phones
- Social networks
- Internet browsers
- Home computers/laptops
- Point of sale transactions (online or brick and mortar)
Phones are passively collecting location data, even without checking in on Foursquare or Facebook.
A company’s DMP, when fully operational, should get information with three different levels of accuracy or confidence. First, your company should be collecting its first-party data. This “first party” data includes email addresses and other demographic details, of course. But it should also include information about past purchases, coupons used, and more – anything that can reveal future buying activities.
Second-party data is the information gathered from other companies. They glean these same details from their customers.
Third-party data often comes from data mining systems or aggregators. They purchase this information from many sources and market it to smaller companies. This allows even small companies access to more massive crowds to make highly targeted and accurate pictures of potential customers.
Tips and reminders for setting up your data management platform
Many independent and small business owners can immediately see the benefits of outsourcing their DMP work. Behemoth companies like Amazon, Facebook, and LinkedIn sell access to their very detailed data.
This source of information is so large that even Fortune 500 companies will see a benefit in gathering data beyond what they get from their website or checkout kiosk.
When setting up your DMP, or communicating with your provider, think about the needs of your business. Ask yourself these questions:
1. What categories do I want to create to provide the best experience for my customer?
2. Which additional data is available that might help me expand or improve my business?
3. What are ways I can target new customers?
4. How can I get former and current customers to become repeat customers?
5. Is there something I have that they don’t know about, or is there something they want that I need to offer?
There are a lot of decisions to make about your business. Maybe you don’t have to make them all. Your marketing company can operate a comprehensive DMP. It is essential to choose a data management platform that fits your needs and delivers information the way you want.