A data explosion
The amount of data collected has grown exponentially. In 2011, we created the same amount of data every two days as we did from the beginning of civilization until the year 2003. The ‘digital universe’ was claimed to be as large as 1.8 trillion gigabytes in 2011 (which would be enough data to fill 57.5 billion 32GB iPads. You could build the Great Wall of China twice over) and is set to rise to 40 trillion gigabytes by 2020.This dramatic increase of data is being created by everything from sensors, which gather the world’s weather information, to personal fitness trackers strapped to the wrists of health conscious users. More importantly for communications agencies, every action taken by a user on the web, from a quick Google search to building a website, creates data that can be harnessed to better understand people’s online behavior. So, while it’s clearly evident that the online community is generating data at a ridiculously fast rate, what can we actually do with this data, besides using iPads to build giant walls? How can we gain access and leverage it to benefit our clients? This is where data management platforms (DMPs) come in.
What is a Data Management Platform?
As the name suggests, DMPs are essentially repository that gather and manage all of your data for online marketing purposes. These platforms aggregate all the data generated from various sources, such as online, offline and mobile, into one interface so that we can learn more about web users. This then allows us to convey the right message to the right person at the right time, which is ultimately the biggest challenge for any form of advertising. DMPs have the ability to extract data from a user’s web browser cookie as well as a client’s website analytics and third party data, in order to create insights for the marketer to leverage. However, DMPs offer intelligence that goes beyond the standard cookie or even just the data itself. They offer marketers cutting edge technology that can identify trends in the data, helping you understand your audience better and ultimately target them in complex ways that wouldn’t have been possible in the past. This level of analysis is the difference between what DMPs offer that other cookie-based solutions cannot.
What insights can a DMP offer an advertiser?
Let’s use an example: let’s say you’re running a display network ad campaign for a fashion e-commerce site, and there are multiple sources of data. You may be using a DSP (demand-side platform such as Media Math) to push ads, an analytics tool that measures website performance and a weekly newsletter promotion. These three systems individually provide you with information about your client’s customers or potential customers. However, they are not linked to each other, so there would be no way of targeting customers (using the DSP) who have signed up for the newsletter and also browsed through leather hand-bags on the site in the last 30 days. Even if you had a site analytics tool that allowed you to target users who have browsed through certain pages of your site and a newsletter cookie, you wouldn’t be able to identify the same user across both systems. If you used a DMP on the other hand, you would be able to do this.
A DMP lets you view all of your data in one place, allowing you to link it with information provided by third party sources. For example, this would mean that you could target users that fall above a certain credit score while simultaneously targeting them based on their annual income. Tying all these insights together would allow you to target a highly specific set of users based on an increasingly accurate data set, with the intention of boosting your conversion metrics. Essentially, it all comes down to how much data you push through your DMP and how far you’re willing to go with it to serve ads to the perfect audience at the time that best suits them.
Having said that, marketers still need to address the timeless challenge of relevance. At the end of the day, millions of impressions are served every day to people of different ages, interests and objectives. So reaching the right user at the right place and time, with the right intent, is essential to all advertisers, regardless of what platforms or systems they are using. Relevance will remain the key to opening the doorway to consumers.