DMPManager
DMPManager
Advantages and disadvantages of a DMP
While DMPs are useful for many online marketing campaigns, there are some downsides to this type of software. Changing technologies and attitudes often make certain software obsolete, so it’s important to think about all the pros and cons of a DMP before you use it for your marketing team. To help you decide, consider the following advantages and disadvantages of using a DMP:
Advantages
Here are some advantages of using a DMP to market your products and services:
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Easy access to data: Since DMPs compile different forms of data in one place, it’s easy for marketers to access all of their information when they want it. Marketers can access first-party, second-party and third-party data from various sources to compare results and look for inaccuracies. These comparisons make it easier to find trends and patterns in the data.
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Deeper audience understanding: Comparing data and finding trends can help marketers learn more about the audiences they’re targeting. Knowing the online behavior of potential and returning customers allows marketers to deepen their understanding of what those customers want from businesses, products and advertisements. This may help marketers create more successful ads.
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Discovering new audience segments: Another benefit of using a DMP is discovering new audience segments through third-party data. Third-party data may provide more insight into specific group identifiers, like household income, that narrow the target audience for a product and change how customers shop online. Marketers can then create new audience segments with this data.
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Targeting customers effectively: Data from a DMP gives marketers more information about how their campaigns perform online. With this information, they can better determine which ads are successful and which ads need to be changed to generate sales. Analyzing the detailed data from a DMP can help marketers target their audience more successfully to generate sales.
Disadvantages
Some disadvantages of using a DMP include:
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Using cookies to track behavior: Cookies are files that contain small pieces of data about customers and their behavior. DMPs get third-party data from cookies. Although some companies are moving away from cookies because of privacy concerns, many websites offer customers the option to disable cookie tracking or choose which information a website can track. While this data may be less specific, it can still generate useful reports when combined with first-party data.
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Complex to learn: One reason to avoid a DMP is its complexity. There are many sources of data and sections of information on this platform, so teaching it to your entire marketing team may be challenging. In addition, with changing technologies, DMPs may add extra features that users have to learn to use or could become obsolete altogether. However, learning how to use a DMP can better prepare your team for using other data collection software in the future.
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Possibility for skewed results: Analytics results depend on the data provided, and a DMP may not always have quality data. If third parties collect or label their data incorrectly, customer behavior results can become inaccurate. This affects how marketers create audience segments and campaigns and can lower the chance that you’ll convert ads to sales. A simple way to fix this is to compare third-party data against other sources to check for inaccuracies.
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Needs information source: The final disadvantage of DMPs is that they need an information source to function. A DMP can’t collect data on its own, so you have to combine it with other technologies that can take data from websites and put it into a DMP. This makes the collection process less efficient and creates more work for your team. It’s a useful feature, however, for organizing your first-party data with third-party data that a program wouldn’t usually collect at the same time.