Aim Small, Miss Small: How to Use a Data Management Platform to Eliminate Waste
Marketers handicapped by primitive tracking tools and outdated legacy technologies are wasting time and money, and most of all, data. Great data. Not buzzword “big data,” but real data that can and should change how they optimize every campaign and marketing initiative. Don’t be one of them.
Don’t spend your time merely collecting data and grasping at straws for insights, spend your time critically thinking about the conclusions your data has presented to you.
A DMP, or data management platform, is a system of technologies that aggregates your data over dimensions that are relevant for ad targeting.
Using a DMP, first and third party data segments become rich behavioral and experiential insights, leading to marketing campaigns and programs that deliver personalized messaging in contexts that matter — improving the efficiency of your media spend.
It’s time to move on from the dated and static “persona” to specific targeting parameters that match behaviors with affinities (key consumer attributes) for better audience segmentation and return on advertising spend.
A 2015 Econsultancy report found that 95% of marketers that have used a DMP believe it was beneficial for centralizing control and standardization of existing first party data (in other words, they felt that a DMP enabled better data governance practices), 97% found it beneficial for email, web, social, and content personalization, and 89% found their DMP allowed them to develop usable data sets that included third party sources.
Data is the currency of the future, so stop letting your media dollars get burned as your data goes up in a cloud of smoke — put your audience data to use within a DMP and let it realize its true value.
What is a Data Management Platform?
Put simply, a DMP aggregates, analyzes, and displays your data in a manner that is useful for marketers, businesses, and publishers.
For marketers, a DMP allows you to create audience profiles based on first and third party data, on and off owned media properties.
These audience profiles differ wildly from a persona, as they don’t try to imagine the be-all and end-all of what matters to your consumer —instead they focus on recognizing specific attributes based on real behaviors.
There are a couple different ways a DMP works to collect the data that informs these profiles.
On the digital side, a DMP uses cookie-based data capture methods to create profiles of those who visit your web properties. Say your brand has six web properties, a DMP can track a customer across these sites with tags to gain insights into who they are and what they are looking for. This customer data from your site is stored in a CRM or your analytics tool and typically includes limited personal, demographic, and behavioral information.
Real insight comes when this first-party data is paired with third-party data generated from your customer’s interactions with other properties across the web. By learning how your consumer interacts across the internet, you get a much better idea of their attributes.
DMPs can also be fed offline data — offline in the sense that it is not collected from a website in real-time. This data, often a simple txt. file, can come from your own CRM or be purchased/obtained from third party partners.
One use of this offline data is to connect shopping behavior to online user habits. A retail store that collects email addresses at the point of purchase typically uses them to match in-store purchases to online behaviors and determine if, and how, you interacted with their website before coming into the store to make a purchase.
This allows retail stores to better understand an increasingly fragmented consumer journey and properly attribute the digital touches that drove the final purchase.
Ultimately, all this data is used to build rich audience profiles and cohorts based on actual consumer behaviors. These small audience segments can then be targeted by your media spend on programmatic, demand-side platforms (DSP) to optimize your campaigns.
For example, say you are a clothing retailer marketing to “millennials," a far too broad audience segmentation that reveals little about who your customers are and the messages that will appeal to them. You implement a DMP and learn from first and third party data that a core audience segment for your clothing is 28-30-year-old women that live in big coastal cities, make upwards of $70,000 a year, and are frequently visiting high-end fashion sites before making a purchase from your more moderately priced store or e-commerce site.
We can identify members of this segment that are already our customers, and use the DMP to create a lookalike model that finds people on the internet that have the same user behavior as our current customers.
Because the number of attributes required to create a lookalike are surprisingly small, the DMP can quickly cultivate audiences linked to the behavior and attributes of userIDs that are likely to convert on your advertising.
This finely targeted audience is then served digital ads with personalized, tailored messaging through a DSP, or demand-side platform, in which ad views are purchased in real time to match real behaviors — someone behaves like your target user online, and they are served an ad.
The efficiency of your media spend skyrockets when ads are only served to those most likely to convert.
Why is Data the Currency of the Future?
Marketers are sitting on gold mines of data that reveal exactly who their target audience is and in many cases, just giving this gold away to their media partners. Brands need to make sure they are getting data in return for their data, and utilizing the insights both datasets reveal.
A DMP is incredibly useful as a central platform to aggregate and analyze data from multiple sources and vendors.
I can’t overstate the power of smart data collection and utilization. Subtle shifts in your core audience can be easily detected with a DMP and can steer your marketing efforts to be that much more effective.
Going back to my previous example of a clothing store that knows their buyer is a millennial — that’s a huge age range with unique values and vastly differing points of view.
As the consumer journey becomes increasingly fragmented and our digital and physical worlds converge, it is becoming imperative that marketing messages are as personalized as possible to actually garner attention.
Marketers can’t rely on broad segmentations like “millennial.”
We are marketing to an audience of digital natives that have grown adept at tuning out messages — to break through banner blindness, ad blockers, and the din of today’s media landscape, messages must be targeted, personalized, and appear in intent-rich moments of want or need.
How to Decide Which DMP Is Right for You?
I’m going to make the assumption (aspirational or not) that you’re sold and ready to implement a DMP — so where do you start? The many choices for a data management partner are polarizing, and there certainly isn’t a one-size-fits all approach.
Before reaching out to any of the market leaders above, map what your brand and data strategy is going to be. Remember that even the best DMP can go to waste if it isn’t accompanied by sound strategy and follow-through.
I recommend starting with a data and analytics audit that will inform your one, three, and five-year brand strategy. Believe it or not, I’ve seen category leaders start vetting DMPs before they’ve even properly set up Google Analytics.
A wealth of data is only useful if you know what to do with it. But don’t be intimidated. A DMP can arm your marketing teams, agency partners, and everyone working on building your brand to know what’s working and how to better optimize the experiences you deliver to your consumer.
If we understand our consumer, their wants, needs, tensions, and context, we can deliver a powerful laser-focused message during demand moments where our brand gets to be the hero in the story.
Use the power of a DMP to target your media spend at actual consumers, more often. Let the big, broad media buy of the past be buried in the relic graveyard and target specific audience segments, determined by their actual purchase behaviors.
Spend less money, get better traffic, and understand your consumers better than ever — all with a DMP.
Everything starts with a conversation, doesn't it? Speak with one of our strategists and learn more about the power of a data management platform to drive growth for your brand.