How do Data Management Platforms (DMPs) work?

06 Nov 2018

  • Digital Marketing
  • Data-driven Marketing
  • Technology
  • Data
  • Marketing Technology

Delivering on customer experience is impossible without data. Alongside engaging content, data is the fundamental building block that enables personalisation, relevant marketing, improved customer service and a richer content experience.

This quickly leads us to the humble Data Management Platform. Also known as a DMP. But how does a DMP platform work? We’ll take you through the basics!

How DMPs Work?

DMPs use a combination of techniques to identify users across different services and devices, record and enhance information regarding their interests, demographics and behaviours, and then put these to use.

A DMP generally consists of four main components:

  How DMP works

Data Collection:

DMPs capture data on customer interactions across the DMP owner’s digital properties and customer data systems (such as a CRM). This is referred to as first party data. Each customer is tagged with a unique anonymous ID, ideally in the form of a first party cookie, alongside customer identifiers from the CRM. This process occurs constantly and across any device.

Combine & Control:

First party data may not include all data necessary to adequately personalise campaigns. A DMP will ingest data from other sources (2nd & 3rd party data providers) and match this to first party IDs to build up a more complete picture of customer interests and behaviours, including matching IDs across multiple devices. In addition, the DMP will enable data access and usage controls to be defined, ensuring they adhere to data governance requirements.

Insight & Segmentation:

A DMP provides a range of data discovery and analysis capabilities to guide audience segmentation approach and provide insight on best performing audience attributes. A DMP applies a range of rule-based and algorithmic techniques to the attributes of the digital IDs it holds, enabling them to be grouped together into meaningful customer segments which can be used for advertising or other purposes.

Audience Activation:

Once audience segments have been defined, this information can then be passed to a wide range of marketing and advertising platforms, such as ad exchanges or demand-side ad buying platforms (DSPs). Most DMPs feature prebuilt integrations with major advertising platforms, as well as standard integration methods. In addition to advertising, the DMP may also connect to web, mobile and direct marketing platforms to order to better inform personalisation and customer marketing.

Would you like to deep dive further into Data Management Platforms?

ADMA’s sister association Digital + Technology Collective in partnership with Adobe created a comprehensive Tech Guide called Data Management Platforms: Getting to Know the Unknown which will cover everything you need to know and more including the best vendors in the market.

DOWNLOAD Tech Guide: Data Management Platforms

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