Is DMP the New Grail?
Marketers are aspirational people and "DMP" is the latest buzzword threatening single customer view’s long-standing reputation as the Holy Grail of marketing. Essentially, a data management platform (DMP) is a tool that stores data from multiple sources, helping marketers identify previously anonymous customer segments so they can target them via the appropriate channel with appropriate messaging. However, before deciding that the single customer view (SCV) is old news, marketers should be aware of the limitations of DMP.
DMP vs SCV
A SCV aims to unify disparate streams of data in order to achieve a holistic view of the customer and their preferences. This insight can be used to increase engagement rates, drive effective propensity modeling and improve customer revenue. A DMP on the other hand concentrates more on segmentation and automated marketing messages. Although a DMP can enable brands to segment their customers with increasing degrees of accuracy, a SCV is still the most complete view of the customer you can get.
One of the main attractions of a DMP is the ability to identify and target unknown customers who visit your website but don’t convert. While a SCV can store anonymous data and hold onto it until more information comes through that allows a marketer to connect the dots and turn an unknown visitor into a prospect, a DMP goes further by allowing you to gather more information to identify that customer.
Due to these usage differences, many companies offer DMP as a separate piece of software when it should be seen as part of the overall marketing mix. A DMP can help marketers discover useful customer data, but in order to make use of it, you’re going to need a SCV sitting alongside it. Retailers will miss a trick if they concentrate solely on segmentation and automation instead of building a solid picture of the customer using traditional methods like preference centers and better communication internally across departments.
Really the New Grail?
The idea of an all-singing, all-dancing tool that performs every function under one roof is very appealing. However, retailers would be mistaken in thinking that a DMP can fulfill all their marketing needs — especially considering an accurate SCV that automatically updates in real time based on customers’ preferences is still out of reach for a lot of retailers.
A DMP is generally predicated by an operational need — in this case, to improve targeted marketing communications to individuals or groups who fit certain profiles. DMPs are therefore shaped with that kind of application in mind. A SCV is more generic, as it’s not subject to the same application software constraints. It can be used to service a wider set of current and future needs.
A SCV is critical for any brand that wants to improve the way in which it communicates with its customers. A DMP can also be a very useful tool, but it’s not a replacement for personalized, well-targeted communications. Retailers should consider how to make a DMP work alongside SCV, rather than replacing one with the other.
Steve Mepham is the head of technical delivery at Celerity.
