A Brief Introduction about Data Management Platforms (DMP) and How it Reshapes Marketing
Marketers and product development executives have been, until recently, designing their campaigns mostly on assumptions derived from business and personal observations of market trends and/or personal experiences. For seasoned marketing executives in their local market, it was easy to forecast how the audience would perceive the ad or the product due to the presence of a lot of common traditions, values, perspectives and cultural aspects between the marketer and the client.
When it came to launching an entirely new product, marketers could have relied on quantitative or qualitative research to further dig deeper into the minds of their consumers. This proved helpful at times, and occasionally failed due to customers providing socially desirable responses or simply due to having an unstructured study of the product/service, the client and the constant change in market conditions.
Naturally, research subjects in this case “the clients” do not overtly express their true selves when they know their responses, behaviors and attitudes towards a product or a campaign are being assessed and evaluated in great detail. In turn, responses and research results were somehow skewed and never enjoyed a 100% fidelity rating; thus, the presence of a probability value “P value” in all research formats.
The emergence of social networks – and their popular acceptance by billions around the world – has prompted the birth of targeted ads based on user behavior. Long ago, a marketing executive would assume that their targeted segment “let’s say women between the ages of 25-34 who have been recently engaged” read a particular bridal magazine. Instead of placing the ad in a fixed position and hoping that as many of your target segment comes across it, a marketing executive was able to create an ad that “follows” their targeted segment across millions of websites using Google’s Display Network or social media networks or even smart phone apps and games.
The Birth of Data Management Platforms
Standardized social media advertisements are also becoming obsolete; clients have become harder to group into categorical attributes and their online behavior is constantly changing. Businesses still assume that they know their clients’ demographics and could be very possibly chasing the wrong segments. One good example is that a diamond retailer could target women with an ad, while they should be targeting their male companion in order to complete the product acquisition cycle. The next step in the evolution of marketing is owning, running and maintaining a complex data management platform that provides marketers with control of all of their audience and campaign data. Having bona-fide data about clients can help marketers craft relevant content, target relevant clients, constantly optimize performance and in turn, increase ROI. Data management platforms enable a marketer to know what their anonymized clients are looking for, what products do they compare to yours, and what search terms they use to find more information about your products or others’. By definition, a data management platform allows its user to collect, organize and activate anonymous client data across multiple channels. If you have made it this far into the article, you might be asking yourself why companies haven’t adopted data management platforms on a large scale. The answer you are looking for is legacy. Legacy data, keepers and systems have long been in place, have to an extent proved accurate and usually work well for most businesses until a certain point. In order to start a reliable data management platform, marketers have to go through an endless ocean of data that needs to be cleansed, formatted and plugged into a DMP. Furthermore, some companies perceive investments in a data management platform as an expense, not an investment that reduces advertisement waste coverage, increases ROI per campaign and helps them retain clients.
The Evolution of DMP
However, data management platforms are becoming more affordable, smarter at reading and identifying unformatted data and easier to setup and integrate with advertising networks. As businesses embrace data management platforms, they have been able to run cost-effective and efficient campaigns that target better prospects. Not only do businesses improve their conversion rates, but also have a chance to turn data, into insights and eventually knowledge about their market(s) and clients. Marketers can also merge offline data – such as sales reports, customer acquisition reports and leads written in wet ink – with online data, they can also leverage data gathered through their CRM, excel sheet data and even data that may seem irrelevant such as website hits and click maps. DMPs have continued to evolve and can even let the data “speak for itself” through the usage of visualization charts, heat maps and AI-backed solutions such as qualitative analysis of particular customer experiences and interactions with the company.
Who should invest in a DMP?
In this article, no particular DMP software provider will be recommended, but the presence of a data management platform is not only recommended, but also essential in today’s marketing and sales world. With the current state of high frequency, less spending guerilla warfare lifestyle of marketing that the social media world has imposed, setting up and constantly maintaining a sound data management platform is key to avoid exhausting your data – such as audience lists – and to ensure that you delivering the right message to the right customer. With that said, any business with any digital footprint should invest in a DMP. As the investment and setup costs go down, a DMP is now more accessible than ever and the investment will pay off almost immediately after data is entered, cleansed and categorized with some level of logic. Any business, no matter the size, has shot in the dark at least once or many times before. Think of a DMP as your night vision goggles that will guide you to where you will shoot your next campaign, promotion, infomercial or even a seasonal greeting.