DMP (Data Management Platform)
What is a DMP (Data Management Platform)?
The term DMP, an acronym for data management platform, refers to a data management platform that collects, stores, and organizes information from various sources to support a company’s activities, though they are primarily used to optimize digital advertising.
1. How a DMP works
Broadly speaking, how a DMP works is simple: it collects data from a variety of sources, stores it systematically, and finally sends that data to advertising platforms based on various criteria. In more detail:
– Data collection. Data is obtained from various sources, which can include first-party data (obtained by the advertiser themselves), third-party data, cookies, or other sources.
– Data processing. Once collected, all information is organized to create audience segments ready to be used when needed.
– Data transmission to ad servers. Once audience segments are created, they are used as valuable criteria for making programmatic ad buying decisions.
2. DMP data sources
A DMP obtains data from different channels, which in turn can be fed by other sources. There are three types of data sources:
– 1st-party data. Data obtained from our own channels, which include: websites, social networks, email marketing campaigns, landing pages, apps, etc.
– 2nd-party data. This is the same type of data as 1st-party data, but in this case, it doesn’t come from our channels, but from other channels. Such is the case with data from partnered companies, which can be relevant to complement ours and increase its value.
– 3rd-party data. This is data that is typically purchased from specialized companies and comes from external sources (just like 2nd-party data). Acquiring it is very expensive, and it is vital for reaching a larger audience in a short time.
3. Advantages of DMPs
DMPs provide various benefits to all companies that use them; some of the most relevant advantages are:
- They ensure effective control over data and its segmentation.
- They help gain a better understanding of the target audience.
- They allow you to process vast amounts of information quickly.
- They enrich existing data and provide it with added value.
- They promote the effectiveness of cross-channel marketing.
- They make advertising more effective and help improve ROI.
- They allow you to manage data from multiple sources.
- They can improve user experience.
- They allow you to manage multiple campaigns across different ad networks.
- Easily applicable personalization for email marketing campaigns, web, and social media.