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What Is a DMP? And Why Does Everyone Want One?

December 5th, 2016   ||    by Charlene Weisler   ||    No Comments

As the media business becomes more data driven, those working in it are creating new terms to help describe new processes, such as “DMP.” And what is a DMP? It’s a data management platform.

According to the CIMM Lexicon, DMPs are systems and data repositories to store, organize, manage, and retrieve data sets. DMPs help normalize datasets to enable audience analytics and, ideally, to optimize media buys for advertisers. DMPs are a crucial part of any successful data-driven campaign, enabling large repositories of data to be accurately integrated, compared, and analyzed.

The Local Advantage

Local TV, which for years has had to contend with small local market measurement samples, stands to greatly benefit from the big data capability of DMPs. Not only can they now collect more and disparate first- and third-party datasets related to local TV performance into larger, more stable samples, but they can also confidently expand their analyses across platforms and create audience segments (depending on what data their DMP ingests).

These capabilities, in turn, enable local TV stations to better compete for advertising dollars by maximizing their inventory programmatically and by supplying more stable and predictable measurement for confident planning, buying, and selling. For MarTech Today, Ginny Marvin writes, “With programmatic ad buying, advertisers are able to extend campaigns across a huge number of sites and apps through ad exchanges, ad networks and demand side platforms (DSPs). Data management platforms help marketers unify audience and performance data across all of those sources.”

Acquisition and Development Heyday

There has been a land rush by media companies to acquire DMP firms. As Ad Age recently reported, these platforms are increasingly playing a bigger role in planning, buying, and managing advertising campaigns. As such, there have been a series of acquisitions of DMP and programmatic companies by agencies. Examples include the acquisition of Accordant Media, Cardinal Path, and a majority stake in Merkle by Dentsu Aegis.

Other agencies, such as Gravity, are developing their own DMPs in order to hypertarget highly specific niche consumers, like Venezuelan soccer fans as opposed to more generic “Hispanic consumers.” Even brands are discovering that the use of big datasets through DMPs can help them focus on loyalists and advocates for their brands as well as divine new consumers, thus maximizing advertising dollars and avoiding waste.

Avoiding DMP Silos

The advancement of DMPs for mobile data has quickly followed the development of DMPs for television. But to some, this division of DMPs creates unnecessary data silos. According to a recent AdExchanger article, Keith Petri, VP of strategic partnerships at IgnitionOne, believes that, “The bottom line is that you need to have all of your data assets and all of the various aspects of your digital tech stack centralized to get the best return on your investment and you can’t do that with siloed mobile data.”

As it stands, there are already large selections of DMPs available to marketers, advertisers, agencies, and content providers. To further stratify these systems with specialty data for a single platform defeats the purpose and very essence of their roles, which, after all, involve a broader scope.

What is a DMP? It’s the cost of entry into the new data-driven marketplace.

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