Quintype and Leverage Labs organized a webinar on 30 September 2021, John Haake, vice president, sales and marketing at Leverage Labs, characterized Customer Data Platforms (CDP) as the next-generation buildings on the foundations of Data Management Platforms (DMP). “While DMP has a focus on paid media, in CDP publishers can form a deeper relationship with users by taking the information they already have, the first-party data collected around behaviour, and do personalization for the most relevant information.”
Customer Data Platforms (CDP) utilize all data, including first-party data, whereas Data Management Platforms (DMP) typically focus on third-party data. DMPs are explicitly developed for advertisers and agencies to enhance ad targeting. CDPs are focused on all marketing elements, whereas DMPs are built expressly for advertisers and agencies to improve ad targeting.
DMPs by themselves will not provide a long-term competitive advantage since their goal is to assist marketers selling digital advertising, although over time with more anonymous data, the targeting becomes more accurate. CDPs make it easy for DMPs to integrate first-party data to improve ad targeting, and a DMP enriches CDP data for better customer communication.
Leverage Labs distinguishes CDP and DMP
Market forces bring new trends and opportunities –
- Privacy – The first paradigm shift is with Opt-in vs Opt-out as it puts the consumer in charge of audience tracking.
- Data blindspots – The behemoths like Facebook, Amazon, Whatsapp, Google, and LinkedIn claim a massive amount of the money spend, creating a data blind spot for the customer.
- Diminished Scale – Current data on-boarding relies heavily on synching cookies or consumer-centric ID points viz., PII including personal eMail addresses. IDs are challenging to match in the Business to the Business domain, while personal eMail is relevant and easy to match.
- Third-party cookies and IDFA – The demise of third-party audience tracking. The addressable audience shrinks in scale, and CPM’s plummet on open exchanges as behavioural data becomes scarce.
Publishers see news consumption on social media, and they all publish their news there. While social media is weaponized with information, the audience only engages with sites that are viable for them. Hence, publishers need engaging content to retain audiences.
Haake said Leverage Labs is working with publishers to understand exactly what they intend to use their first-party data to drive. Many decisions made at the time of implementation have significant ramifications down the road, thus addressing these use cases earlier allows setting up the CDP environment to drive those cases efficiently. CDP’s are marketer’s tools for audience building. Even as an organization aligns to use the new technology, it takes time to get revenue. His company gives training using case studies and sales sheets – it believes that with the right training, income can accrue after six months.
Publishers move towards reader revenue
As a publisher, there is a robust market of solutions out there. CDP’s that concentrate on the data pipes moving are the oldest type out there. CDP’s that do jobs like tagging all the assets and opportunities that the audience will interact with, do a better than the average job, and are able to collect data.
It’s simple to know whether a visitor is a subscriber and this is very valuable information regarding first-time visits – if it’s a new or returning visitor who hasn’t chosen to subscribe. CDPs can start delivering specific experiences to encourage them along a user journey that converts into a subscription. The publisher can pull the trigger on a more extended subscription for the marginal or sporadic visitor.
So, the more you know about your audience, the better you can tailor the offering. Being able to segment the audience between existing subscribers or returning visitors who are not, publishers have to be ready with multiple plans and customized experiences designed for specific types of users. The CDP understands audience motivation and this leads to better conversion rates.