You probably know by now that data is a crucial element that determines the effectiveness of any business activity. However, it’s only useful when correctly processed, visualised and analysed. And that’s the power of Data Management Platform – a solution that helps marketers achieve better results with data. Find out what DMP is and what benefits it can bring to your company!
Data Management Platform – definition of DMP
Data Management Platform (DMP) is created to collect, organise and manage data, helping companies get more valuable information about their customers. It is mainly used for marketing purposes, such as creating personalised ads tailored to specific audiences.
To build advanced DMP systems, their developers use big data and machine learning algorithms that analyse and constantly improve the quality of provided information in order to get the best results.
Data – the currency of our times
Before we go into the why of Data Management Platform being a solution that can revolutionise your marketing efforts, let’s try to answer the question: why is data fundamental in running a business?
You have surely noticed that big data, data analytics and data science are gaining more and more popularity. As a result, many companies opt for solutions that will allow them to achieve specific goals, precisely based on data.
“In God we trust. All others must bring data.” – W. E. Deming, American engineer and statistician
Have you heard that Netflix saves $1 billion a year by using big data? This platform collects data on searches, ratings of movies watched. By processing this information, it can provide its users with personalised recommendations and suggest watching a film that they will probably like. A data-driven recommendation engine is precisely the solution that has helped them retain customers and increase revenue.
What datasets can improve the efficiency of your business operations?
Data sources can be divided into three key categories:
- First-party data — data you collect yourself based on clients’ interactions with your business. So it’s information about page views, subscriptions or datasets from your CRM,
- Second-party data — data that belongs to another partner company with whom you share information,
- Third-party data — data from other sites or external social media profiles. They are mainly used to reach new audiences.
Data-driven marketing – the key to success
Did you know that 87% of marketers say that data is their company’s most underutilised resource?
A lack of a data-based strategy is a big mistake. According to Forbes, companies that use data-driven marketing are over six times more likely to report achieving a competitive advantage in increased profitability and five times more often in terms of customer retention.
It is why the term data-driven marketing is becoming so important. It is a strategy that uses data from various sources (see: paragraph above) to support marketing activities.
Thanks to the acquired information, marketers can better understand their customers’ behaviours and needs, thus creating more personalised messages, increasing the effectiveness of their actions, and achieving the highest possible return on investment (ROI).
Data Management Platform – 7 key benefits of data analysis
1. Maximum personalisation of the message
With DMP, you can create customer segments based on various demographics such as age, gender, location or purchase history.
You can also group them based on their interactions on particular sites, engagement on social media, or email (newsletter) behaviour. In this way, you can create campaigns for targeted audiences, tailoring your message to a specific type of customer.
2. Increased customer satisfaction
Did you know that as many as 80% of American adults participating in the Epsilon and GBH Insights research said they expect personalisation in-retailer communications?
Data-driven actions are helpful not only for marketing departments but also for customers, who are more likely to receive messages that perfectly match their profile and preferences.
3. Optimise costs and improve ROI
Sending personalised messages increases the chances of purchase and improves your return on investment (ROI).
Did you know that companies that use advanced personalisation note a $20 return for every $1 spent? Based on that, you can multiply your marketing expenses by 20 to imagine what a good investment the personalisation available in DMP can be.
4. Building customer loyalty
By tailoring your messages and marketing efforts to your specific audience, your customers will feel that you understand their needs. It will make them more loyal to your brand, and they won’t think about your competitors’ offers.
What’s more, by analysing your marketing data, you will be able to identify your most loyal, engaged and revenue-generating customers. It is an additional opportunity to recognise and value these individuals. To do that, you could create loyalty programs that will allow you to build even deeper relationships and encourage them to make repeat purchases.
5. Ability to quickly respond to change
In this day and age, the speed of your marketing efforts is crucial if you don’t want to fall behind the competitors. A Data Management Platform can make this task easier, with the ability to analyse data in real-time.
Thus, providing you with the possibility to make informed decisions based on the most up-to-date status. In addition, these types of solutions keep your employees informed of any changes faster, so they can respond on time.
6. Improvement of data security
Company data is precious information, and you need to take care of its security. Even technology giants such as Sony fall victim to hackers: a few years ago, they stole bank details of over 77 million PlayStation users.
DMP systems use advanced data encryption technologies and have robust security features. Therefore, using those tools increases the security of your data and reduces the risk of cybercrime.
7. Making better, data-driven decisions
Say “goodbye” to decisions based on assumptions that can cost your business a lot of time, commitment, and money. With tools such as Data Management Platform, you can take actions based on real historical data.
Analysing this information will determine the advertisements that work best for particular groups of people and the forms of communication that give the best results. You will be able to stop the guessing game and focus on what brings the best results.
DMP — in which industries can it be beneficial?
Data Management Platform is applicable in almost every company that conducts any marketing activities. However, it plays a particularly important role in companies performing B2C activities, where we have to deal with a large customer or user base, such as:
- eCommerce (online shops)
- Marketing (marketing and advertising agencies)
- Media industry (news portals)
- Entertainment industry (streaming platforms)
- eGaming (gaming platforms)
Do you want to build your own Data Management Platform perfectly tailored to your company’s needs?
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Our team is experienced in creating unique, bespoke DMP tools and will be happy to develop a top-notch solution for your business. 🙌🏻📞