If you run a business, then there will be times when you will need to have a better data insight. After all, having these insights will help you make important business decisions. At the same time, there will be instances where you will wish to have a system that can easily collect, and organize data. Plus, having the ability to access the data from different sources, whether it is offline, online, mobile, and more is a big perk that every business owner will dream to have.
If you too crave such a system then you can have that by building a strong data management platform, or DMP. I remember how DMP saved my small startup. Having misplaced an important document, I blamed it on my habit of always being glued to my Spectrum Gold package. But a backup of the file was luckily stored in DMP. It sure was a big relief for me.
What Is a Data Management Platform & How Does It Work?
Data Management Platform or commonly known as DMP is a system that enables you to collect, organize, and activate audience data by using any source. It is a really useful tool that will add value to your organization by providing you with important insights about the customers.
Now that you know what a DMP is, the next thing to know is how it works. Well, as stated earlier, a DMP is a tool that you can use to store data with the help of multiple sources but do you know what it uses to do so? Let’s find it out!
- Application program interfaces
- Tages located in mobile apps and websites
- First-party data onboarding
- Server-to-server integrations
DMPs deals with data that falls into the following three categories
- First-party data
- Second-party data
- Third-party data
First-party data can be collected directly from customer behaviors such as clicks and downloads. Second-party data is the information that is obtained when a business purchases it from another company. And lastly, the third-party data is provided by the aggregator who collects it from a variety of sources.
The Elements Required to Create a Solid DMP
Let’s now have a look at the different elements which make up a strong data management platform.
1. Data Collection Phase
This layer deals with the collection of the data. It includes two parts, i.e., client-side and server-side. The former focuses on collecting the data which it transfers to the server-side. The latter gives endpoints that receive the data which is communicated from the client-side. It logs and queues the data so that the next layers can process it without any issues.
2. Data Enrichment & Normalization Phase
The data is normalized and enriched on the server-side. The irrelevant data is deleted and the data scheme of DMPs is implemented. Moreover, do remember that the data can be further enriched with additional data points, but only if there is a need for it.
3. Merging, Profile Building & Data Storage Phase
The fresh data is now merged with the previously stored data to create user profiles. But why are these user profiles so important? Well, they are used to transform the collected data into events and profiles. This helps in audience segmentation.
There may be different identifiers for user profiles. Every profile will include user attributes (such as age, and location) along with events (such as page views, and transactions).
4. Data Analysis and Creating Segmentation Phase
A DMP can analyze the data. It can then make segments for particular customers or audiences. A segment helps marketers to break down data. This is what aids them in allocating the data to particular groups of potential customers.
A data management platform is necessary for businesses as it will allow them to easily store their data and keep it safe. Such a system also allows you to create user profiles which is important as it will let you know more about the customers. Also, not to forget that it enables you to refine the data which helps you in updating the information frequently. It is a platform that has a lot of perks. Companies should use it if they want to keep their data organized.