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CDP vs DMP: Choose the Right Data Platform for Your Business Needs

Florian Delval

Director, Technical PMM

CDP vs DMP: How are these two marketing technology solutions different?

In this blog, we will explore the two types of platforms, CDPs vs DMPs, that are helping marketers make more informed decisions. Customer Data Platform (CDPs) and Data Management platforms (DMPs) are essential components of a data-driven marketing technology stack.

Each solution provides tools for marketers, sales, IT, and support departments on how to effectively target different audience segments of the population to deploy better customer experiences that generate positive customer engagement. Understanding what each platform offers and how it empowers all of your teams within your organization is essential during the evaluation process.

As customers engage with your product and services across multiple channels, devices, and geolocations, they expect a personalized and seamless experience across all touchpoints. For brands to deliver on this expectation of a unified customer experience, they need the correct management systems in place to generate customer-centric strategies and deploy them to make the customer’s journey simple.

For a marketer to be successful, they need a marketing technology (martech) stack that allows them to easily access and organize their customers’ first-party data and behaviors in one central location. This will enable marketers to quickly and efficiently deliver a positive interaction to new and existing customers, while still allowing marketers to deliver a beneficial experience through CDP marketing automation.

Customer Data Platforms

Customer Data Platform (CDP) recently entered the scene. It is now being predicted as the #1 solution to help collect and unify customer data to generate insights from all offline and online different sources. This includes historical, contextual, demographic, and behavioral information to provide customer insights. Smart-hub CDPs are used for creating personalized customer experiences by collecting and tying together customer data through personally identifiable information (PII)-like email addresses and phone numbers to create a 360-degree view of the customer. Unified CDP data is a tool that is imperative for brands to be able to improve audience segmentation to AI predictions that drive intelligent and personalized experiences.

Marketing, sales, and support teams that utilize a smart-hub CDP are able to leverage 1st party data to deliver hyper-personalized opportunities across multiple channels through customer insights and a 360 customer profile.

Customer data platform system does this by:

  1. Collecting customer identities and real-time interaction data from all first- and third-party data sources (through prebuilt data connectors)
  2. Stitching them together and removing duplicates to form a single, persistent history for each customer to create an accurate customer profile
  3. Empowering marketers and other business professionals through a single customer view user-friendly interface to gain individualized customer insight by analyzing each customer, segment audience, and predict the next-best actions to foster customer relationships and purchasing.
  4. Enabling automated orchestration of 1:1 personalized campaign journeys across all marketing efforts, customer experience, and commerce channels, including test design and measurement

Data Management Platforms

Data management platforms (DMPs), often leveraged by digital marketing agencies and/or in-house marketing teams, use these technologies to identify anonymous data, audience segments by demographic, customer behavior, or location in order to improve target digital advertising campaigns.

DMPs aggregate high volumes of anonymous customer data originating from multiple online sources. The primary data sources for DMPs are 3rd party data. DMPs must work with unknown entities like cookies, devices, and IP addresses to exchange information about audiences while protecting personal privacy. Because different companies-including competitors-can usually access the same anonymous data. A data management platform does not provide a sustainable competitive advantage. Instead, it helps digital marketers better understand and target audiences.

As you can see, these two systems are distinct in their use cases, users, and the data they collect. A few things that you should consider before deciding whether to implement a DMP vs CDP into your martech stack:

  1. Is your customer data siloed and how is your marketing, sales, and support team able to share and access this data?
  2. What type of user data do you currently have access and where is it being stored?
  3. Is your customer data secured, especially their PII?
  4. Are you focusing on personalizing individual experiences or targeting an audience for digital marketing campaigns?

Answering these questions will help you determine whether a CDP vs DMP is suitable for your business needs.

Written By

Florian Delval
Author's LinkedIn Profile

Director, Technical PMM

For the last decade, Florian’s mission has been to empower enterprise organizations in their digital transformation process via the definition and deployment of a strong Customer Experience Stack. Florian educates enterprise organizations to increase the value of their technology investments in a complex and ever changing environment.

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