CDP Vs DMP is something of a common topic of discussion among marketers and entrepreneurs. As many of them are aware of the terms CDP and DMP, but choosing one is confusing.
Both CDP and DMP provide great customer insights that can help marketers to target their audience more precisely with right offers and messages.
Even though CDP and DMP both have some common characteristics, besides that, they are a complement to each other.
As the current need of the hour for data-driven marketing is increasing at a rapid rate. Businesses owners are eager to know the CDP vs DMP so that they can implement it in their business which is right for them.
GlobalDMA discovered that 49% of marketers use data to improve customer experience. (GlobalDMA)
If you are also one that is eager to know more about CDP vs DMP? Read this article- we are covering here-
To make it clear, we are differentiating CDP vs DMP based on some parameters. Check them out here-
CDP vs DMP- 9 Key Differences
1. Difference Between CDP and DMP Based on Data Types (Including PII)
The main difference between CDP and DMP is the use of customer identities. And another is CDP deals with Martech and DMP deals with Adtech.
In general, PII is a piece of data that recognizes a particular individual. It could be a mobile number, email Id, security number, etc.
CDP can operate by considering any(email, phone number, security number, etc.) PII information based on that you can decide what type of PII you want your CDP to gather.
To have better insights into your audience, more data is required. Therefore, CDP focuses on collecting as much information as possible of a particular person from various touchpoints of the customer journey.
CDPs mainly use first-party data collected directly from customers across various marketing channels and platforms. And DMP depends on the anonymous data (cookies, ad ids and IDFA) more for targeting advertising campaigns.
But here the major challenge is selecting the CDP which is adhering to data security standards, which means it must take consent from the audience before collecting their data and delete the same when a user requests to do so.
DMPs, on the contrary, use anonymous data, which means DMPs don’t use PII information of the users, but still it gathers data in the form of cookie id and ad ids.
DMP also requires consent for carrying out any activity. DMP due to their evolution and nature of data type they deal with today they can enrich the first-party audiences from already available third party and second party audiences in their ecosystem.
2. Difference Between CDP and DMP Based on Data Retention
The other significant difference is how long CDP and DMP platforms can retain data of your audience.
Most of the CDP’s provide the option to their users to select the term of retaining their data besides an option to delete user data. As in CDP, the more data they have, the more informed decisions they can make.
Consider an example to understand CDP vs DMP-
Like if you want to offer something to your most valuable customers who spend a good amount in the previous year. Now if you’re going to target them in the current year, by just seeing the data from CDP, you can easily target them.
On the other side, DMPs are quite the opposite to it in this term, because they retain data for a short time usually 90 days.
Let’s consider another example to understand CDP vs DMP-
For DMPs the above example will not work, here we will provide you with another example which suits DMPs. Consider, someone is looking for the cheapest flight ticket in a particular month or some days. Here you can’t reconsider that audience after a year. It’s clear that DMPs targeting is based on a short period, not like CDPs.
3. Difference Between CDP and DMP Based on Single Unified Data Storage
When it comes to data storage, CDP stores data in a centralized, scalable location, making it easier and fast to access it all at once.
CDP can create a look-a-like audience with DMP; on the other side, DMP can create on its own without CDP.
When it comes to DMP, it maintains data in two storage locations. In one storage location it stores the complete data and in another location, data which require quick access that is a subset of another storage location but kept separately.
4. Difference Between CDP and DMP Based on Way Data Collected and Stored.
CDP collects raw data with a granular level of precision and stores the complete data with unlimited capacity. It collects data for persistent, long-term storage, in multiple formats without any earlier defined taxonomies.
Conversely, DMPs gather data like common transactional marketing tools along with tags, APIs. And uploads frequently, the outcome view is high-level and in aggregate. For this, most of the DMPs platforms retain their user data not more than 90 days.
5. Difference Between CDP and DMP Based on Implementations in the Complete Martech Stack
CDPs have the option to retrieve the user information whenever they want and wherever they present in the customer lifecycle.
CDP’s can integrate the user data to any platform for various adtech and martech purposes.
For example, uploading user data onto Facebook for look-alike modelling, retargeting and other purposes across the customer journey. Interestingly, CDPs can work with both anonymous and PII data.
DMPs are designed explicitly for adtech to create targets for advertising and obtaining marketing or dealing with new or anonymous customers.
DMPs can help you to get the more specific purpose of your customers at the current moment so that you can target more appropriately.
6. Difference Between CDP and DMP Based on Complete Customer Profile
CDP enables you to access the complete profile(historical, behavioural, demographic, social activities and many other) of a particular person on hand to carry out any interactions with customers directly.
In DMP, you have a list of segmented audiences based on specific parameters. DMPs generate these segmented audiences based on their anonymous cookie ids, ad ids, IP addresses, segmented or de-segmented data.
7. Difference Between CDP and DMP Based on Activation
CDPs activate by direct customer engagement and DMPs activate by DSP (advertising).
For example- When we have first-party data and want to activate cookie id we go for DMP and for PII activation we go for CDP.
8. Based on Cross-Device Identity
CDPs follow deterministic matching based on unique Ids: emails, mobile numbers, etc.
DMPs follow probabilistic matching based on specific algorithms and activate through an activation with a DSP. Making DMPs do have the capability to integrate with device graphs.
9. Based on Use Cases
As CDP collects lots of information about the users, it helps the marketers to target the audience on different stages of the customer lifecycle.
CDP’s major strength lies in scaling the personalization view of marketing across various stages of the customer lifecycle.
You can even use CDP for social media ads by creating custom audiences by uploading PII like email addresses.
CDP use cases such as- Audience creation, advertising, acquisition marketing and digital targeting.
DMP, on the other hand, focuses on advertising campaigns, by targeting a specific segment of the audience improves the efficiency of media buying.
Because of legal concerns, DMPs can’t de-anonymize data of a person to know their identity. DMPs’ decisions get more accurate over time.
DMP use cases such as- Single view of the customer
“You can consider CDP as your park that you have access to and know who is there in it. While DMP is like a public park, which is a shared space and you don’t know the people in it.”
– According to Tony Byrne, Martech Analyst and Founder of Real Story Group.
Which One Do I Need?
When you’re selecting between CDP and DMP platforms, you need to consider many factors. Therefore, you require a clear understanding of your needs and goals to make a proper selective decision.
Here is a List of Some Comparisons Factors to Consider-
- CDP stores data in a centralized location, making them adaptable and fast to analyze. DMP stores data in two locations that make it difficult for integration based on the platform you use.
- CDP stores data which has a long life while DMP stores data which lives less than 90 days.
- CDPs can be integrated with various systems for advertising. DMPs can’t perform advanced identity matching.
- CDP is a differentiator and can collect data in the entire customer life cycle. DMP is an equalizer and can get back the same data for a set query.
- CDP can get the identity of the customer and approach them accordingly with the right offers and personalized messages. DMP stores anonymous user-profiles and segments the data based on specific parameters.
- CDP can store demographic, contextual, historical data of the audience. DMP can segment only the audience based on certain factors.
To Sum Up-
In short, CDP and DMP complement each other. If you want to go with the third-party vendors for better reach go for DMP. However, for maintaining long-term relationships with the customers and wanting to leverage your first-party data go for CDP.
To facilitate you, We have one option that is Audienceplay. It has features of both CDP and DMP along with it has additional features that can-
- Enrich your data by adding all missing attributes to your existing data
- Monetize your data by sharing anonymously with their partner brands and generate revenue for every footprint of your user.
- Segment your data based on various granular level precision factors.
- And many more features.
Isn’t something exciting? Don’t wait, try it now, it’s free.