In a competitive market dominated by data-driven marketers, the success of your marketing strategy depends on your ability to leverage customer data effectively.
As you may already know, you can start with tools like tag managers for the most basic level of data management. However, using tag management strategies alone leave gaps in mobile data collection. If you're ready to get more critical with customer data, and looking to collect the data for marketing tools and analytics, then you will find such data collection tools insufficient.
Finding a reliable data management solution
What you need is a reliable data management solution that has the right blend of sophistication and functionality, an instrument that enables you to collect data with accuracy and precision.
Most importantly, you require a system that can not only collect data, but also unlock and activate its value in tandem with your existing and future marketing campaigns.
After all, each organization uses customer data for different purposes and has specific marketing goals.
The problem is that a lot of terms are thrown around in the MarTech, or marketing technology, industry, and it is often hard to distinguish between various tools that technically fall into the same category but operate very uniquely.
In this guide, we will help you understand the three primary technical categories into which the customer data integration tools fall: the Customer Data Platform (CDP), the Data Management Platform (DMP), and the Customer Data Infrastructure (CDI) – and the intended use examples for each.
What Is a Customer Data Platform (CDP)?
A customer data platform, or a CDP, tracks and maintains first-party data on customer engagement. From websites and ads to email campaigns, CDPs help organizations seeking to improve their understanding of user behavior and tailor their marketing approaches accordingly.
Each of the customer data platforms has unique features that distinguish them from other CDP vendors in the market, but they can vary pretty drastically.
For example, here is a brief comparison of three popular CDPs: Segment, Lytics, and Blueshift.
Segment is a SaaS product versatile enough for use by organizations large and small across different industries. It works by collecting customer data across all touchpoints, meaning that customer service, product development, and sales departments alike can use the platform to streamline and personalize their processes.
Its comprehensive portfolio of integrations with analytics, marketing, and data warehouse services like Google Analytics, WebEngage, and Amazon Redshift allows teams to customize their use of the platform to fit their company’s specific use goals.
Lytics is an advanced CDP designed with marketers in mind. This CDP seeks to add value to marketing efforts by delivering an advanced, fully aggregated profile of each customer at all points across the customer journey.
The feature Lytics View further helps marketers by synthesizing this data into intuitive AI-led recommendations designed to help drive conversion rates and optimize brand positioning.
This CDP is used by mid-market to enterprise-level brands across the consumer packaged goods (CPG), travel, hospitality, media, entertainment, and technology sectors.
Many of its clients are in the publishing and financial services industries.
Blueshift uses a combination of data collection and patented, AI-driven marketing automation to help marketing departments sift through large datasets, create personalized customer experiences, and scale marketing initiatives for growth.
Predictive scoring, one of the platform’s key features, results in data management that is intuitive and focused, offering teams more streamlined and meaningful customer insights across all marketing channels. The platform’s behavior-based data capabilities, combined with numerous integrations with advertising platforms such as Google Ads, make it a suitable yet high-powered marketing solution for small to medium-sized organizations.
CDP vs DMP: Benefits of a CDP
In the comparison of these two data management methods, it’s important to preach the benefits. Here are the main reasons why someone would want to choose a customer data platform over a data management platform. Gaining customer viewpoint - This data management solution helps you to collect data from many different sources and put them together in a way that makes sense across all platforms. Doing so allows you and whoever else to see everything about that customer in one place. It’s good for organization but it’s also good for security.
Great for scaling - Having all of this data and a process for managing it is so crucial. It will help you identify problems, forecast projections more accurately, and help you and your team react to things before they happen.
Identify customer habits - In addition to creating a process that makes it easy to scale, utilizing the right customer data will help you identify customer habits so you can better target them and optimize your marketing efforts.
What Is a Data Management Platform (DMP)?
A data management platform, or a DMP, serves as a virtual warehouse for online, offline, and mobile customer data.
DMPs are useful for marketing and advertising teams who seek to understand third-party data to optimize their ad targeting efforts.
They function by storing large swathes of data gathered from all marketing channels and segmenting this data into reports that organizations can use to identify trends in behavior and even unearth new potential customer bases.
Popular data management platforms include Lotame, Salesforce Audience Studio, and Adobe Audience Manager, to name a few. Every DMP focuses on different features. You can compare them to decide which is most suitable for your business needs. For example, some may be better at ad network integration, say, data transfer, and DSP integration, while others might be better at data classification.
Two examples of campaigns that can be structured based on a thorough analysis of DMP-gathered data are:
● Direct mail - In the case of direct mail, the organization holds personally-identifiable data on customers and prospects that allow for targeted outreach.
Publishers, media agencies, and marketers are known for using DMP technology to extract value from the large datasets that their organizations collect.
While some larger enterprises have opted to build their in-house DMPs, choosing a third-party vendor is still the preferred route for most other companies.
The data management platforms in today’s digital market come at different price points and include unique suites of features that businesses can customize to their needs.
Although DMPs typically work with more third-party data, many vendors still offer first-party integration to empower companies to gather data from a greater breadth of sources.
You can also pair a DMP with a DSP – a demand-side platform – to further spur advertising initiatives through the buying and selling of campaign-level data with media buyers.
CDP vs DMP: Benefits of a DMP
The goal of all data management solutions is to help drive further success in your business. Let’s look at some of the main reasons why people use a DMP. Increased revenue - When we look at a DMP vs CDP one of the main benefits here is the increase in revenue. The system allows you to better target your audience which almost always can result in increased sales if you’re using the data in the right way.
Cross-device management - When you’re running marketing campaigns, having the right audience is key but being able to manage data across many different devices is also important. A DMP allows the marketing team to identify the ideal customer and reach them more easily.
Reduced expenses - By using a data management platform, you can retarget warm leads, build on previous relationships, and focus on the clients that you know will convert.
What Is a Customer Data Infrastructure (CDI)?
The customer data infrastructure (CDI) plays an integral role in revolutionizing customer experience in today’s growing digital market.
This SaaS product expands upon the customer relationship management (CRM) system by collecting first-party data from customers at all touchpoints in the customer lifecycle – from the first contact to registration to churn. Organizations can then activate this data to analyze consumer trends and more effectively strategize their outreach campaigns to different audience segments.
An example of one such CDI is yours truly. When used alongside leading digital marketing tools and analytics, MetaRouter has delivered proven results to companies at all levels - from startups to large enterprises.
Among other common CDIs, Oracle GoldenGate and Matillion are two that essentially focus on helping users connect to data sources and transform, model, and govern customer data. Perhaps we're biased, but CDIs have some additional benefits:
In a digital age with data breaches that adversely affect customer trust, data security is a high priority for organizations.
One benefit of MetaRouter for customer data integration is that the platform can be deployed on your private cloud, ensuring that your data is housed in a high-security, GDPR, CCPA, HIPAA, and PCI-compliant location, preventing the risky sharing of data and minimizing the chance for data loss.
CDIs offer a full suite of features and third-party tools that empower companies to have complete control over their data governance, routing, and audience management.
Some popular options on most rosters of client, server, and mobile integrations include Amazon Redshift, Google Analytics, and Webhooks.
The intuitive, optimized hosting capabilities offered by a CDI help companies on both the customer-facing end and the back end.
Customers experience faster-loading pages and less lag time when accessing a company’s site, and data governance teams can work more effectively with minimized instances of data bloat and duplicated data.
So which one do you need?
Since every use case is different, here is a brief recap of the similarities and differences between CDP, DMP, and CDI.
Customer Data Platform (CDP)
Data Management Platform (DMP)
Customer Data Infrastructure (CDI)
Centralized area for tracking and maintaining all first-party data on customer engagement
Analyze and personalize the customer experience, whether from service, sales, or marketing standpoint
Virtual warehouse for anonymous, third-party (online, offline, and mobile) customer data
Optimize ad targeting by use of tools such as cookies
Focused on building, managing, and refining audiences
Collects first-party data from customers at all touchpoints in the customer lifecycle
Involves data routing and hosting, integrations with third-party marketing and advertising tools
Data is no longer a consequence of the digital era – rather, it is a resource that service, sales, and marketing teams alike can utilize to gain targeted leverage in today’s competitive consumer market. Each of these SaaS products has a specific angle of focus, and organizations can choose to use one, two, or all three in tandem.
● Is a company’s current goal to make the customer experience more personable and friendly? Analyzing data gathered by a CDP can give customer service teams the insight needed to accomplish this.
● Does a business development team need a better way of viewing and managing leads, with more analytics capabilities than that offered by a standard CRM? Or does an organization with highly-sensitive data need to essentially own a private data router in order to ensure security and compliance? A CDI could be the answer.
● Is an organization seeking new audience segments to expand its marketing outreach? In that case, the ad targeting power of a DMP is most appropriate.
Today’s dynamic consumers interact with businesses across numerous platforms and touchpoints in their customer journeys. It is thus essential for an organization to have a marketing strategy in place that can collect, understand, and use this data in an intentional, results-oriented way.
SaaS vendors in the MarTech industry are acutely aware that their products – whether a CDP, CDI, or DMP – have value to organizations at all levels, but often deal with granular information and processes. A thorough consultation with a vendor representative, along with having an understanding of their organization’s current data strategy, can help a team determine which combination of tools is ideal for their needs and goals.