CDP vs DMP vs CDI: Welcome to the messiest martech category ever!
Authored by Brian Ivanovick
“It’s all just a bit of history repeating” — Propellerheads
I can’t imagine how frustrated you must be. Part of your job is understanding the marketing technology landscape. It’s not an easy task…even for the modern marketer. You’re faced with an ever-growing, overly-complicated list of acronyms and vendors.
So you decide to do a bit of research online. Every vendor’s website has high-level promises of “better experiences” and “more revenue.” It’s enough to numb the mind and exhaust the spirit. Overall, these types of platforms are all trying to accomplish the goal of unifying multiple sources of data (1st parts data and 3rd party data) into one efficient system. Once unified, the data platform can assist a marketing team by leveraging this user data to create actionable insights, 360 customer identity profiles, and potentially marketing automation in the near future. However, there are many different approaches to trying to improve marketing efforts via the effective use of a martech stack.
The martech category du jour is the customer data platform or CDP. To complicate matters, some vendors have started calling themselves a CDI, or customer data infrastructure. And then you’ve got your good ol’ DMP, or data management platform. What the heck is going on? Is there really a need for all of this technology to manage all of this data?
The purpose of this post is to quickly explain the key difference in plain English. That way, you can tell your boss, “Yes, I’ve looked into it”— and get on with your day. So here it goes:
- CDPs. A customer data platform is an application that: a) houses all of your customer data; b) makes it available to non-technical business users; and c) activates that data into marketing, service, and sales channels for seamless personalized experiences. Notably, CDPs must also have predictive analytics and campaign orchestration capabilities to track customer engagements and the individual customer journey. Some CDPs tack on additional functionality, but if they don’t do the above, then they’re not a true CDP solution.
- CDIs. A customer data infrastructure solution provides prebuilt data connectors that collect data from point solutions and send that data to the systems that need it. They are a data pipeline, just moving the data from multiple channels to one place. CDIs typically start on the technical side of the house (since they help alleviate the need for building homegrown APIs) and make their way into the business over time. They sometimes have some minimal data storage capabilities, but they are not a replacement for a CDP.
- DMPs. A data management platform was supposed to do much of the work of both CDPs and CDIs, but then they ran into a major hurdle: privacy regulation. DMPs manage anonymous profiles and join them with third-party datasets, so marketers can power better targeting in paid advertising and on their own sites. DMPs are also largely cookie-based. Regulators and technology companies are making it harder to use third-party data and third-party cookies. The result is, DMPs are slowly but surely falling out of favor.
- CDPretenders. The CDP space is very hot at the moment, and so a number of vendors are tacking on an off-the-shelf database like BigQuery and saying that they now magically have a CDP offering. I call these the CDPretenders. We saw vendors run the same play when DMPs hit the market. Suddenly everyone spun up a database and had a DMP offering. Marketers largely saw through the noise and bought the best-of-breed. I imagine that what’s what will happen again. It’s all a bit of history repeating.