Without question, our best-read content is about the CDP vs. DMP: the differences, the similarities, and, ultimately, which platform is best for marketing professionals.
More than a year since we published the original blog on the topic — and some time since we consolidated it all into an eBook — it’s time to advance the discussion further.
Yes, we still get asked all the time, “What’s the difference between a customer data platform and data management platform?” Today, more often than not, marketers have a firmer grasp on the distinct differences between a CDP and DMP and, rather, want to know:
“Okay, but do I need both?”
And though it might be everyone’s least favorite answer, ours remains:
In an effort to provide a more satisfactory response, though, we’ve put together some general guidelines for what your life looks like with a CDP, with a DMP, and with both.
The CDP vs. DMP comparison breakdown
The easiest way to make the CDP-vs.-DMP comparison is to break down how both platforms handle different essential marketing tasks. In other words, their core attributes.
Anonymous data management
- CDP: The platform provides anonymous data storage: data that is collected from someone who may eventually become identified or known but isn’t right now or yet.
- DMP: Anonymized data is stored here: data that has an associated identifier associated, but that personally identifiable information has been hashed or de-identified.
Customer data sources
- CDP: The martech is built around first-party orientation: collecting data from all of the brand’s touch points and data sources to tie them to actual behaviors exhibited by a unique user, whether anonymous or known.
- DMP: This solution is build around third-party orientation: data based on millions of soon-to-be-useless third-party cookies from across the web and matched with non-PII attributes like demographics and site behaviors.
Data expiration and storage
- CDP: The profile created for each user is stored persistently in a database (Apache Cassandra, in our case), so the data doesn’t expire and your profiles have no limit to the amount of data you can store in them, giving you a progressively richer view as the person continues to engage.
- DMP: Using the cookie for data collection means that a data management platform “profile” typically only lasts for 90 days before it expires (sometimes shorter, sometimes longer, as some DMP vendors offer additional storage for an additional expense).
Customer identity matching
- CDP: The platform is deterministic. In the case of BlueConic, our CDP only matches and merges profiles based on a unique identifier (email address, subscriber number, etc.).
- DMP: The platform is probabilistic. Because DMPs were built to expand ad reach, segments and matching are typically based on algorithmically derived guesses about links between people for look-alike modeling and high-level personalization.
Customer segment creation
- CDP: Data is unified and updated in real time. As a marketer creates a segment in BlueConic, that segment is immediately active, so the profiles that match the segment’s criteria associate and disassociate in real time (24 milliseconds, to be exact) as their attributes change. There also does not need to be a minimum number of people in a segment for it to be a viable definition.
- DMP: There’s a 24-hour processing window. Once a segment is created in Salesforce DMP, for instance, it takes 24 hours before it becomes usable for ad targeting. Each segment needs to have at least 20 people in it because the algorithms require at least that number to still have a target cohort once you assume 40-60% matching.
Get a CDP, DMP, or both platforms: The big question for marketers today
So, is when it comes to the CDP-vs.-DMP debate, it’s critical to ask yourself:
“Do I need one, the other, or both?”
As a marketer, a CDP, without question, gives you a better base of data to work with.
It’s a dataset of your actual audience that can be activated for use cases across the entire customer lifecycle: acquisition, engagement, conversion, and retention.
There aren’t restrictions on the first-party data you can collect. The customer segmentation capabilities in a customer data platform occur in real time. And the CDP is channel-agnostic to ensure the seamless flow of data between marketing and business technologies.
In short, if you, your marketing team, and organization as a whole want to …
- Collect all first-party customer data for both anonymous and known individuals
- Assemble customer segments in a few clicks and exchange them with other systems
- Deliver effective personalization across channels to contacts based on unique needs
… then you don’t need a data management platform.
In fact, you’d be underwhelmed by the DMP’s approach to doing this kind of thing where such functionality appears to exist within the solution.
However, if you have an advertising and modeling program that relies on the DMP to …
- Find look-alike models elsewhere on the web, particularly on other companies’ pages
- Gather data about your audiences’ interests based on behavior on third-party sites
- Align campaign messaging with specific audiences as they move across the internet
… then you have good reason to keep using a DMP because you’re benefiting from what these solutions are built to do: get more of the right people interested in your brand.
Taken together, a CDP and DMP can unlock some pretty compelling use cases for brands, including those we’re currently running with many of our customers who:
- Pass the third-party segmentation in the data management platform to BlueConic’s CDP for on-site personalization and distribution to other systems readily
- Use BlueConic segments as the basis for the DMP’s look-alike modeling so that the brand’s actual audience’s traits provide the starting point of a look-alike audience
- Make BlueConic the conduit for data into the DMP from a CRM, ESP, or POS (hashing the identifiable data to comply with the DMP’s privacy, of course) so that the DMP has access to some of the customer data stored in those systems
Additionally, server-to-server integrations between BlueConic and data management platforms provide data about users who haven’t even been to our customers’ websites, offer data that was layered in after the fact, and assign segmentation based on rules that weren’t there when a user was online or changed after they left.
Evaluating your CDP and DMP use cases essential to making your decision
The scenarios above play out differently based on your industry-specific use cases as well, but we’ll save that for another time.
The CDP-vs.-DMP discussion is surely to last at least a little while longer (though some forecast a rapid migration from DMPs to CDPs in the months and years ahead).
It’s in your best interest to carefully examine the options on the market for both types of martech to see which solves for the most urgent pain points and needs, which is easy for your marketing department to own and operate, and which allows for true data liberation.