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How to Choose the Right Data Management Platform

Data is the lifeblood of any successful business today. Though it comes in many forms and can be used to many ends, the value hardly changes — at least when talking about optimization and performance. You need data to be competitive, but you also need data to continue satisfying your customers’ needs and wants.

If you’re not analyzing data to see who’s visiting your online and offline stores, when they’re visiting, who’s purchasing which products, or who is visiting but not converting, you’re simply flying blind. Without good data analysis, there’s no way to know whether your marketing efforts are highly successful or a complete waste of time.

You know you need data — and lots of it. But what do you do once you have it? More importantly, how do you process the big data collected to ensure you’re making the best use of what you have?

The answer: A data management platform or DMP.

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Why Do You Need a Data Management Platform?

There are marketing tools aplenty on the current market. That doesn’t mean every single one of them is created equal, nor does it mean they can all offer the same reliability and performance. There are DMPs, DSPs, DSPs calling themselves DMPs, CDPs, and many things in between.

So do you need a DMP? The only way to truly discern whether a DMP is relevant and necessary for you is to understand the general concept of the platform. What is a DMP and why do you need one?

Data Mangement Platform (DMP)

A DMP — or a data management platform — is a centralized data system that collects audience and customer information from any source, and analyzes it to provide an in-depth reference and resource collection. This data is built into audiences and then exported to other platforms for targeted marketing campaigns, personalization, and cross-platform messaging.

DMPs help marketers, publishers and agencies better understand and make sense of all the customer data they have collected. With a DMP, you can aggregate your customer data into one platform for a holistic understanding of your customers, and use those insights to positively influence your marketing campaigns for greater ROI. DMPs allow users to combine first-party, second-party, and even third-party data to build targeted profiles for future data-driven marketing campaigns.

The answer to why you need a DMP is simple: Your organization needs a DMP in place to organize, process and return valuable yet actionable data about your ideal customers, and send that data elsewhere to reach your ideal customers. DMPs allow you to acquire, retain, and upsell your most valuable customers, which will have a positive impact on your company’s bottom line.

For example, imagine you have an unorganized data stream about what pages your site visitors have been to recently. Yes, you can see what pages are popular. That’s a basic, surface insight. To make the best use of these numbers, data needs to be processed with advanced analytics and a variety of digital tools.

That website traffic data, for instance, could reveal what age the visitors are, where they are located, what they are looking for or doing on your website and even what happens as a result of their visit. DMPs also go beyond telling you general demographic data about your audience, to share behavioral and interest data about your audience. For instance, while running a campaign retargeting your previous customers to bring them back to the site to make another purchase, the DMP might show you that this audience responds much better to a video ad than a banner ad. Or that they may have an interest in sports that you weren’t aware of previously. All of these behavioral insights can be fed back to your creative team to influence the content that you show your audiences in the future, in the hopes of increasing engagement with your campaigns.

Imagine knowing exactly what your customers want from an updated or follow-up product you’re currently developing? Now, take that in a segmented form to understand differences in generations and age groups, finding your most influential audience as a result.

Establishing Goals for DMP Use

Naturally, each professional will look to leverage a DMP differently. It’s important for marketers to understand and set goals early on, identifying what it is you want to accomplish with the system(s) you’re adopting. To make it a little easier, we’ll break down successful DMP use cases by marketer, agency, and publisher.

1. Marketers

As a marketer, you can use a DMP to learn about your most valuable customers, including what they want or need from your products and services. It’s also important to target specific audiences on the platform of their choosing. If most of your target audience is using mobile searches, for instance, that’s where you want to be. DMPs offer cross-platform or omnichannel targeted advertising, so you can personalize the content and messages to specific customers. Overall, DMPs are used by marketers to acquire, upsell, and retain customers, to increase your bottom line.

2. Agencies

DMPs are used by agencies to collect, organize and analyze customer data on behalf of their advertiser clients. They can gather website data as well as campaign data to see who is interacting with each campaign. Agencies can also build audiences for data-driven targeted advertising campaigns, and expand their audiences using 2nd or 3rd party data to reach a broader target audience. Insights into the audience behavior and demographics can then be shared back with their advertiser clients in the form of a campaign wrap-up report or audience profile report.

Collect, Organize and Analyze

3. Publishers

Through collected customer-behavior insights, publishers can uncover information about visitor activities, interests, and motives. This can, in turn, be leveraged to create and develop more personalized experiences, such as product recommendations, targeted ads and much more. As a publisher, you can tap into the kind of contextual information that drives modern business strategies in a digital or mobile environment.

For publishers who sell advertising space, they can use these data points to build audiences to execute targeted advertising campaigns, which outperform broad, untargeted campaigns. Better performing campaigns means happy advertisers who keep coming back for more.

What to Look for in a DMP

Here is how to select a data management platform fitting for your organization:

1. Consider ROI

The first step to accurately evaluating a data management platform is to determine if a DMP will provide a sufficient return on investment. This means not only up-front cost, but the resources it takes to implement and maintain the system.

By connecting data sources, adding structure to the data based on the publisher’s specific business rules and helping make the data actionable, the DMP creates higher revenue for their inventory, provides more profound insights into their audience and makes better business decisions. There are many ways a DMP can help a company increase its bottom line.

2. Data Collection

One of the most important considerations for choosing a DMP is what kind of data they can handle and how it’s organized and processed before returning to you. Most DMPs can and will aggregate first-party data from any source, including online, offline and mobile-based content.

Aggregate First-Party Data

But will your DMP also allow you easy access to second and third-party data, for example? What about data onboarding? How many platforms is your DMP integrated with? Are you limited to only collecting data from certain sources? You should be looking for a DMP that collects the most efficient data and interprets it the most accurately.

How much of the data collection is automated? Is there a human involved? Do you as the end-user have any say in what the “hierarchy” or “taxonomy” of your data will look like? Or does your DMP only offer a “one-size-fits-all” taxonomy?

3. Parent/Child Architecture

In terms of data organization, does your DMP offer a parent/child architecture? This architecture allows organizations that are not completely flat in structure to keep their data sources separate (in a child’s account) while also seeing an overall picture of all the data combined (in the parent account). Parent/child architecture is great for:

  • Agencies who are managing the data of multiple advertiser clients
  • Publishers or networks with multiple websites who want to see each sites’ data individually
  • Large marketers with subsidiary brands, who want to keep each brand’s data separate
  • Global companies who want to easily see how each local data set performs individually

4. Audience Insights and Profiling

Once the data is collected in a DMP, the next step is to gather audience insights and analytics. When choosing a DMP, be sure to find out what kind of insights your DMP offers. Do you have access to any audience insights BEFORE running a campaign, or do you have to turn the campaign on first? Are there reports that are exportable for you to share with other folks in your company? Feel free to request some sample reports from the prospective DMP to see what they will offer you.

Efficient or Accurate Information

Another benefit of DMPs is that you can gather more efficient or accurate information about your customers and audiences. This allows you to hone in or target more specific, narrowed groups you might otherwise miss when looking at a massive collection of data. It’s another way to build actionable intel for future campaigns and strategies.

5. Campaign Optimization

Once your campaigns are running, what options does your DMP offer you for optimization, to make the campaigns work better? Can you manually optimize and adjust the campaigns on the fly? Is there machine-learning or automated options for optimization, that will do the hard work for you? How well do these optimization options work?

6. Second-Party Data Marketplace

In cases where you don’t have necessary first-party data available, it helps to have access to a robust, versatile market. This also happens to be an area where most DMPs surpass — or fall short of — the competition. A proper 2nd party data marketplace allows you to exchange data whether you’re buying or selling, ultimately connecting with participating customers and parties directly. Does your DMP offer 2nd party data?

Beyond simply having a 2nd party data marketplace, is this marketplace connected to multiple DSPs? Or is the data you buy and sell in the 2nd party data marketplace locked into the DMP, and only available between DMP users? Lotame Syndicate is our 2nd party data marketplace, allowing you both of these options (DMP and DSP).

7. Access to Third-Party Data

Does the DMP you’re considering offer the use of third-party data, and do they have a steady supply of third-party sources? Furthermore, how many providers does the DMP provide for purchase inside their proprietary platform? Some DMP vendors provide greater access to extensive data networks, which include billions of profiles, customer insights, and opportunities. The Lotame Data Exchange, for example, is a massive global network that enables limitless possibilities outside of your own first-party data.

Depending on what your data needs are, you may want to have easy access to a particular source of third-party data. So be sure to find out what types are offered before you sign on.

8. Size Versus Flexibility

How big is the data management company you’re considering working with? Some data management platforms decrease their personalized services as they increase in size. Without a doubt, data management companies that are part of a larger corporation will have fantastic marketing resources, but you will have to question how responsive they will be to your needs.

Data Management Platform Scalability

When you’re looking for support, a company that responds quickly and professionally is priceless. Who will be your main point of contact at the DMP once you sign the contract? Will you have a dedicated resource or just a set of online questions and answers? Depending on how much support you are looking for, that may affect how you choose a DMP.

9. Highly Integrated and Compatible

You’ll also want to be sure the DMP provider you choose can export and activate data across all the channels you currently use, and those you may consider in the future. Is the DMP flexible enough to let you send your data to any DSP or activation channel, or are you limited to only the ones that they select? How flexible are the APIs from your DMP? If you want to be able to collect your data from any source and send it anywhere, data portability may be important to you.

Choosing the Right Data Management Platform

Due to the immense amount of options available, marketers may feel overwhelmed when they begin the search for a DMP. Differing recommendations may come from colleagues in similar industries that leave those looking for a data management platform feeling confused.

When running a marketing campaign, you want to make sure you’re targeting the right audience for a higher ROI. The right data management platform can also help agencies facilitate better client relations and customer service by keeping data organized. Ad campaigns target more efficient custom data sets when managed through a DMP.

Importance of Customer Service

All the data you have access to acts as a powerful tool, but what if you don’t know how to use your DMP or have questions, who are you going to reach?

When you’re looking for support, a company that responds quickly and professionally is priceless. Who will be your main point of contact at the DMP once you sign the contract? Will you have a dedicated resource or just a set of online questions and answers? Depending on how much support you are looking for, that may affect how you choose a DMP.

The Lotame team is comprised of smart, passionate people around the world dedicated to data innovation. Lotame is dedicated to helping our clients succeed, and we take this commitment seriously. Our team works tirelessly to ensure our customers are reaching their KPIs and improving ROI.

To find out more about Lotame’s data management platform that allows you to collect, organize, activate and protect data from any source — including online, offline, mobile and CRM — request a demo today.

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