Emerging Platforms

How to Choose a DMP

Posted by Chris O'Hara on December 11th, 2012 at 1:01 am

A Conversation with Bridget Bidlack of [x+1]

Today, data is like water: Free-flowing, highly available, and pervasive. As the cost of storing and collecting data decreases, more of it becomes available to marketers looking to optimize the way they acquire new customers and activate existing ones. In the right hands, data can be the key to understanding audiences, developing the right marketing messages, optimizing campaigns, and creating long-term customers. In the wrong hands, data can contribute to distraction, poor decision-making, and customer alienation. In order to combat that problem, there are now over a dozen data management platforms (DMPs) configured to help marketers and publishers leverage their first party data, and take advantage of the growing universe of 3rd party data. I recently sat down with a DMP veteran, Bridget Bidlack, to ask how one should approach choosing a platform.

To the unpracticed eye, it seems like many DMPs do exactly the same things. What are some of the subtleties and differences between the major platforms?

Bridget Bidlack (BB): It’s true that, to someone unfamiliar with the technology, the differences may seem subtle, but that’s often the case no matter what you are discussing. I recently came across a catalog that featured a violin bow for $22,000. To me they all look alike but to a virtuoso the right bow can make all the difference in the world.

That’s the way it is for marketers and the technology they rely on every day. DMPs are very different in the capabilities they provide; the approach and level of integration they are capable of; their ability to adapt to future media channels and market demands; how well they can scale in terms of the amount of data they can ingest, manage and store; and their ability to deliver actionable analytics regardless of the audience touch point.

Smart marketers who evaluate their needs and assess the full range of solutions to find the one best able to suit their needs will benefit today and in the future.

Many DMPs sprang forth from a network background. Is there an advantage to having a heritage in the online media business? Is it better to leverage a “pure play” DMP that has been built from the ground up?

BB: It’s really important to bear in mind the differences between a DMP designed exclusively for display media and an enterprise DMP designed for the needs major brands that require multi touchpoints.

Too often people behave as though display advertising is the be-all and end-all of marketing, and that’s probably true inside an agency. But enterprise marketers have a much broader palette of customer and prospect touchpoints they need to manage. That’s where a purpose-built enterprise DMP really shows its value. So, what are the differences between a display-focused DMP and an enterprise DMP?

  • First, an enterprise DMP ingests and normalizes data from a wide variety of sources
  • Second, is to automate the way data is organized and segmented
  • Third, is to be configurable enough to use an organization’s unique approach to audience identification and data match key models
  • Fourth, is to make the enterprise’s unique data actionable across ALL touch points in real time
  • Fifth, is to deliver consistent messages and enforce offer eligibility across all channels – not just display,  but important customer channels such as email, click to chat and SMS for example.

You have worked with some of the world’s largest and most aggressive marketers to help them leverage their data. What were some of the challenges you encountered at the enterprise level that surprised you?

BB: This probably doesn't come as a surprise, but in large organizations it is sometimes difficult for individual departments to put the greater good of the overall organization ahead of their own goals. Typically this is because of the way individual departments are measured. It's important to understand the needs of all departments and how an enterprise DMP can help meet those needs. The costs and benefits of DMPs are enterprise-wide and their benefits should be evaluated that way.

Some organizations have created systems that provide DMP-like capabilities. In these situations, a company can weigh the total cost of ownership and benefits of building out the full DMP functionality versus working with an available enterprise DMP. There are a number of factors to consider: speed to market, ROI, domain expertise and consumer privacy, to name a few.

Large organizations have many disparate data sets that are used in many different ways. Sometimes, just getting a list of all the different data sources and attributes is a challenge. Often, there isn’t a shared taxonomy that can be used across departments. Data management and permissions can also become an issue as different departments might have rights and permissions to different data sets that others do not. All of this points to the challenge of finding a unique ID to link all of an organization’s data for a given customer together in a way that makes it accessible and actionable where and when it is needed.

How big is the market for DMPs? How many companies actually have the data challenges that warrant leveraging a “big data” platform for marketing?

BB: The market is growing so fast that this is a difficult question to answer. Any marketer would love to have one platform to reach their customers across any current or future channel. Some marketers might claim they’re comfortable limiting their reach to channel-specific audiences available through specific ad networks or email providers, but that’s rare. Sophisticated marketers want to use the full force of tools, technology and insights at their disposal. They want to use their own data along with third-party data, they want to take into account interactions on their website, as well as those taking place on other marketing channels to inform every message put in front of a consumer. To do otherwise seems like marketing with one hand tied behind your back. Who would choose that?

What are some of the considerations to bear in mind? The number of disparate data systems they are working with, the number of touch points they use to reach their consumers, how frequently the data they depend on is updated, how quickly they need access to the data and the sheer amount of data that they have on their customers. They also need to ask themselves whether their goals can be met with internal systems or by using multiple point products. In most cases it will be more efficient, economical and effective to work with a complete platform able to meet all their needs.

Let’s pretend all current DMPs have exactly the same attributes right now. What should I look for on a DMPs product roadmap to tell me they are going to offer the next great differentiator? Is it Hadoop compatibility? Fast query speeds, based on different storage abilities?

BB: If I were in the market for a DMP and all things were equal, the items I'd like to see in a roadmap would be:

  • A robust and constantly expanding set of self-service tools to allow end users to manage and use their data independently and in a scalable way
  • Continued investment in analytics and modeling to allow customers to understand data in the ways that will make it work best for them. There should also be a balance of pre-defined reports that provide deep insights out of the box, as well as the ability for users to customize them to meet their own specific needs
  • The ability to adapt to emerging market trends and new technologies
  • Attribution modeling that provides the ability to implement custom approaches into the media planning, buying and decisioning processes

Integrations seem to be the name of the game. How important are existing server-to-server integrations? Are DMPs becoming truly “plug and play” as they plug into more and more various technologies?

BB: Having open web service APIs is important for any DMP that claims to provide 'plug and play' capabilities. This approach makes it fast and flexible and easy to integrate with new partners, channels and data sources. Without this type of framework, integration can become a nightmare of custom code, delays and missed opportunities.

What about data? Does the company with the most data win? Should I select a DMP based on the ability not just to manage first party data, but for their ability to link my data to the wider universe?

BB: The idea that more data equals better performance is much too simplistic. When it comes to data, the things that matter are how it is filtered, analyzed and put to work to inform decisions. Quantity isn’t the key at all; it’s all about having the right data and being able to act on it to reach customers and prospects at the right time through the right channels.

The ability to centralize, normalize and make data actionable through any touch point needs to be at the core of any enterprise DMP. The DMP should also close the loop by ingesting campaign data from all channels and vendors, as well as offline activities like in-store sales and call center interaction. The data can be surfaced in a way that is meaningful to the marketer. This means marketers need the ability to define custom attribution models to reflect their unique sales funnels. Based on this information, marketers can measure ROI and inform future strategies.

Data is key but it has to be available, accurate and actionable for it to have the kind of impact that marketers demand.

Will be still be talking about “DMPs” in 2 years, or is there another acronym coming along that marketers need to be aware of?

BB: In the future, marketers will continue to invest in learning about and tapping into the latest channels, networks and screens through which consumers are living their increasingly digital lives. Whenever new channels, networks and screens emerge, there will be an evolution and expansion of the data available to marketers. This means that the systems and technologies for ingesting, testing and validating data will continue to be valued – probably even more than they are today.

Smart marketers increasingly understand the importance of being customer-centric and this implies the need to be data-centric. Knowing this they will continue to invest in data management technologies. They will also bring these capabilities in-house as they have in the past with their core CRM and operational data. Even as the hardware and software running their data management platform migrates to the cloud, it will still be viewed as an "owned" solution. This means that the technology companies that marketers partner with to develop and execute their marketing campaigns will need to continue to invest in becoming data savvy and fluent with the tools and systems in the marketplace.

This interview, among many others, appears in the recently published Best Practices in Data Management from EConsultancy, by Chris O’Hara. Chris O’Hara is an ad technology executive, and the author of Best Practices in Digital Display Media, and a contributor to a number of trade publications, including iMediaConnection. He can be reached through his blog at www.chrisohara.com

One Response to “How to Choose a DMP”

  1. Bridget, you make great points regarding quality of data. More data does not equal better performance, but having right data can make or break the business

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