DMPs, Demystified: New Forrester Wave Report Explores Platform’s Future

MQL, CTR, CPC, AR, IoT … The digital world sure does have a lot of acronyms. Another two (often-confused) for the list: DMP and DSP. Forrester Research’s latest Wave report for Data Management Platforms (DMPs) sets the record straight. CMO.com caught up with Forrester senior analyst Susan Bidel for the details.

MQL, CTR, CPC, AR, IoT … The digital world sure does have a lot of acronyms.

Another two (often-confused) for the list: DMP and DSP.

Forrester Research’s latest Wave report for Data Management Platforms (DMPs) sets the record straight. CMO.com caught up with Forrester senior analyst Susan Bidel for the details.

CMO.com: What exactly is a DMP and how is it different from a DSP?

Bidel: It is a data management platform. It normalizes and prepares for deployment all sorts of data streams from within a client’s company. The most typical customers for DMPs are those customers that have a fairly robust amount of first-party data. First-party data is defined as data that results from a one-to-one relationship between a company and an actual human being.

On the other hand, a DSP is a demand-side platform, a tool that marketers use to buy inventory for their advertising messages. Programmatic is essentially the automated buying of digital inventory informed by data. So a DMP will, on behalf of its customers, send data information to the DSP that is used by its customer to make sure that its media buying is smarter and more precisely audience-targeted.

CMO.com: What are some high-level findings from Forrester’s Wave report for DMPs?

Bidel: The internal division within most companies that initially forms the connection with the data management platform is typically the digital media-buying team. The reason for that is this team is responsible for spending a great deal of money. The DMP allows them to do that more effectively.

As the benefits of working with a DMP for more effective and efficient media buying become obvious, the organization begins to explore the potential inherent in sharing the DMP-driven insights with other digital marketing channels. That’s where we believe DMPs are going–beyond media buying, even beyond the digital media channels, to the full marketing organization, and then beyond even that to the product organization. Let’s face it: If you really know who your customer is and, by implication, who is not your customer, then you can create products that deepen your engagement with your customer and other products that can win over those people who aren’t.

CMO.com: What common challenges do companies face when trying to implement a DMP?

Bidel: The larger the company, the more likely it is divided up into silos of activity. The heads of those silos, in essence, compete with each other for C-suite attention. A lot of large companies have multiple sources of first-party data within them, and they don’t cooperate well at all. Companies that want to get the full benefit of a DMP should have all the data within an organization feed into the DMP. So the first hurdle is to identify all of your sources of data within your organization and to get all your internal stakeholders on the same page on cooperating. That’s a big hurdle for a lot of companies.

Then the next big hurdle is to identify either someone on the staff who has an analytical turn of mind and can be taught to find the nuggets of gold in the DMP insights, or to hire someone like that. It’s hard to find those people.

CMO.com: Any advice for companies that are evaluating DMPs?

Bidel: One is to do what I just said, which is to identify all the sources of data within your own organization. Two, get all the stakeholders onboard. Then, put all the vendors through a really rigorous RFP process. Anticipate all your own needs as best you can and make sure that they have, for example, the full suite of integrations that you expect–that you either will work with immediately or expect to be working with over time.

My advice is to also extend the insights across all the channels. If you are not initially thinking about e-mail, you should look down the road to when you are thinking about e-mail. Make sure that whatever DMP you’re looking to work with has those e-mail integrations or is prepared to make those integrations on your behalf.