The Future of Data Management Platforms
Data management is defined as the collection, storage, security, access, usage, and deprecation of data, no matter where it is coming from. Data management platforms are SaaS tools responsible for the comprehensive management of user data. These platforms help data managers to collect, store, organize, and centralize data from different sources. A DMP further processes the data and performs required analysis and returns a database segmented according to the audience.
Data management platforms have played a vital role in extracting, storing, and analyzing data. They have been with us for so long that data engineers and companies have started taking them for granted. The increasing reliance on the first-party data through CDPs and the burgeoning privacy issues surrounding third-party cookies are hitting DMPs hard. Although, this is far from reality.
Taking cue from how a popular data management platform Lotame spoke for itself, DMPs have a bright future ahead. In fact, they are soon to become partners with customer data platforms (CDPs).
Let us have a look at how the partnership will look like:
- It all started in 2008, when Lotame came out as an ad network selling data and audiences. By 2011, the company launched its first DMP coming out in the market.
- Recently, the company faced an identity crisis. With a heavy dependence of first-party data and fast-paced adoption of CDPs, Lotame gave a thought to convert itself into a CPD as well.
- Later Lotame realized that although the role of CDP is critical, the kind of functionality historically lived with DMP would persist. It includes access to third-party data, built-in analytics, modeling capabilities, and mature pipelines in the AdTech ecosystem.
Although third-party cookies are wiping out, it doesn’t entail an end to it. Customer data platforms can do the hard-work of collecting fragmented, siloed first-party data from different sources, prepare it, and sanitize it. The data management platform can run a quick look-up and distinguish a customer from an unknown visitor based on the customer IDs saved.
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Trends in Data Management Platform (DMP) Adoption by Global Companies
- Increasing Demand for Personalized Customer Experiences
- DMPs help organizations collect and analyze customer data, allowing them to deliver more personalized experiences.
- 63% of consumers expect brands to use their purchase history to provide personalized experiences.
- Growing Importance of Data Privacy and Security
- DMPs can help organizations manage their data in a way that is both compliant and secure.
- 91% of consumers say they are more likely to shop with brands that provide transparency about their data usage.
- 71% of consumers are concerned about how brands use their personal data.
Adoption Trends of DMP Platforms (2022-2023)
According to recent market research, the adoption of Data Management Platforms (DMPs) is expected to continue to grow rapidly in the coming years. Here are some of the latest trends in DMP adoption:
1. Increased Demand for First-Party Data Management:
With the increasing importance of data privacy regulations and consumer data protection, many brands are focusing on building and managing their own first-party data. This has led to an increased demand for DMPs that provide robust first-party data management capabilities.
2. Integration with Other Marketing Technologies:
DMPs are increasingly being integrated with other marketing technologies such as Customer Relationship Management (CRM) platforms, Marketing Automation Platforms (MAPs), and Demand-Side Platforms (DSPs). This integration allows brands to have a more unified view of their marketing efforts and optimize their campaigns across multiple channels.
3. Rise of Identity Resolution:
With the deprecation of third-party cookies, identity resolution has become a crucial component of DMPs. Brands are looking for DMPs that offer strong identity resolution capabilities to enable more accurate audience targeting and segmentation.
4. Adoption by Small and Medium-Sized Enterprises (SMEs):
While DMPs have traditionally been more popular among large enterprises, SMEs are increasingly recognizing the value of data management and are adopting DMPs at a faster rate than before.
Future Predictions for DMP Adoption
Looking ahead, the adoption of DMPs is expected to continue to grow rapidly. Here are some future predictions for DMP adoption:
1. Growth in Vertical-Specific DMPs:
As the demand for first-party data management grows, there is likely to be an increase in the development of industry-specific DMPs that provide tailored solutions for specific verticals such as healthcare, finance, and retail.
2. Increased Integration with Artificial Intelligence (AI) and Machine Learning (ML):
DMPs are expected to become more integrated with AI and ML technologies to provide more sophisticated data analysis and insights.
3. Greater Focus on Data Privacy and Security:
With the increasing importance of data privacy and security, DMPs are likely to incorporate more robust data protection measures such as blockchain-based solutions and encryption technologies.
Overall, as organizations seek to deliver more personalized experiences and ensure compliance with data protection laws, DMP adoption is likely to continue to increase. With the global DMP market projected to reach USD 3.7 billion by 2026, it is clear that DMPs are becoming an increasingly important tool in the data management toolkit for global companies across a wide range of industries.
How Global Brands Make Use of DMP Platforms
Data Management Platforms (DMPs) have become an essential tool for global brands looking to better manage and leverage their data. Here are some ways in which global brands are using DMP platforms:
1. Creating Audience Segments:
DMPs allow brands to collect and analyzes vast amounts of customer data from multiple sources. By combining this data, brands can create highly specific audience segments that can be used to personalize their marketing campaigns.
2. Targeted Advertising:
With the help of DMPs, brands can create targeted advertising campaigns that reach specific audience segments.
3. Measuring Campaign Effectiveness:
Brands can use DMPs to track customer behavior across multiple touchpoints, such as social media, email, and website visits.
4. Improving Customer Experience:
DMPs can help brands deliver personalized experiences across all touchpoints, from web and mobile to in-store.
Global brands such as Coca-Cola, Nike, and Nestle are among the many companies using DMPs to better manage and leverage their data. For example, Coca-Cola has used DMPs to collect and analyze data on its customers, allowing it to create highly targeted ad campaigns that have led to increased engagement and improved ROI.
