CDP vs. CRM vs. DMP — differences, similarities, and how to choose

It’s easy to confuse CDPs, CRMs, and DMPs — each platform touches customer data in some way, and the acronyms themselves are similar. Each has its own role to play in a business, though, so it’s important to take a look at the similarities, differences, and advantages of each platform.

A quick overview and analysis of these three platforms will help you understand:

• What DMPs, CDPs, and CRMs are
• The important differences
• How they work in practice
• Which one might be the right solution for you

What’s the difference between a DMP, CDP, and CRM?

The main difference between a DMP, CDP, and CRM is the primary purpose for which customer data is stored and organized. Between managing existing customers, marketing to potential customers, or integrating that information to create a unified customer profile, each platform uses data in different ways.

DMP

A data management platform (DMP) pulls user data from third parties to target audiences more efficiently and segment key attributes. It captures user data, anonymizes it, and then exchanges it with other companies for targeted advertising.

This means that a good DMP can make digital marketing efforts more efficient.

But the anonymous nature of a DMP also means there’s no ability to connect data to your existing user information. Still, it’s important to note that change is on the horizon for DMPs — with the upheaval of online tracking strategies across the internet, the eventual elimination of cookies, and many companies offering higher levels of tracking protection, it remains to be seen how DMPs will evolve to deliver third party data for advertisers.

CDP

A customer data platform (CDP) builds a robust, varied picture of customers by collecting data from a wide array of sources. A CDP combines customer data from your website, customer service interactions, mobile app visits, physical visits to a store, and even a CRM or DMP.

A CDP only deals with first-party data, but it takes those otherwise disparate data points and uses them to create a complete, unified, and actionable portrait of each customer. These detailed, cross-platform pictures of buyers provide detailed insights on how to reach each individual at every point in the sales pipeline.

CRM

The focus of a customer relationship management (CRM) platform is managing relationships with existing customers and leads. It helps organize data such as purchase history, customer contact information, and any communications that might have happened with that individual.

CRMs are commonly used by customer service and sales reps since this data can be useful in projecting a sales pipeline. This can help align sales, marketing, accounting, and customer service departments by giving them a central tool for accessing customer information.

CRM vs. CDP vs. DMP — key differences

Although all three platforms share similar goals of creating customer profiles, they each go about it in different ways and by leaning on different data points.

• Data source. While a DMP uses anonymous, third-party data, a CRM and a CDP use first-, second-, and third-party data.
• Goal. DMPs are built for prospecting, CRMs are built to manage and nurture customers, and CDPs help engage and personalize all phases of the customer experience.
• Internal management. A CDP and DMP are usually managed by marketing teams, and a CRM is often managed by sales teams.
• Security. CRMs and DMPs rely on additional external tools for capturing customer activity and present possible security gaps, while activities are tracked by a CDP without external tools.

Use cases and examples

The key differences between CRMs, CDPs, and DMPs mean that, while the three platforms are related, individual use cases are well defined. Each type of platform has a range of capabilities, but here are a few examples of what they can do.

CRMs can manage leads through the sales funnel

Turning leads into customers can be a long (sometimes complicated) process from beginning to end. Nurturing each lead appropriately based on its stage in the sales funnel can quickly become difficult, especially with a large list and a long buying cycle.

A CRM makes this less complex. You can adjust your treatment of each contact depending on each lead’s stage in the journey. Emails can be triggered in large batches based on specific behaviors. Or leads can be assigned scores to move them from cold to warm to hot — initially based on parameters like company size or job title, and ultimately triggered by something like an opened email or answered phone call.

CDPs can connect digital behaviors to in-person CX

Back in the heyday of billboards and magazine ads, marketing took a bit of a shotgun approach — with wide funnels and unreliable analytics. Web analytics and digital advertising have changed that.

But what if you want to match online information to a customer when they’re away from the digital space? What if a company wants to bring the precision of online analytics into their stores or other points in a customer’s experience?

This is uniquely solved by a CDP. Where most other platforms are confined to the digital space, a CDP can affect the customer’s in-person experience. For example, if a customer makes a specific query or views a product on the company website, the real-time feedback from a CDP can make that information available to sales reps, customer service, or even in-store employees. This can make each interaction feel connected and like it’s coming from a unified brand. It can also create a customer profile that is far more precise and actionable, moment –to–moment.

DMPs can find new audiences

Strategically finding new audience segments to break into is no easy task. There is a seemingly endless number of options to consider and analyses to run. This is where an AI-powered DMP can step in.

With lookalike modeling — an algorithmic process of finding new audiences that look and act just like your current customers — a DMP can recognize what aspects of your best customers might be shared with other segments. With these lookalike segments identified, a data management platform lets companies maintain targeted advertising while also discovering new audiences.

How to choose the best platform for your team

Which platform is best for your team will depend on your business needs and goals. Consider what problems you need to solve or which processes you need to improve.

• Do you want to improve internal processes and customer experience? A CRM can help with business operations and bring efficiency and order you might be lacking.
• Do you want to see an increase in leads from outbound marketing? A DMP can take your digital advertising efforts up a notch by improving spend with more targeted ads.
• Do you want to discover new customer insights? A CDP unifies customer data to help segment and show correlations you might not otherwise recognize.

Getting started with DMPs, CDPs, and CRMs

DMPs, CDPs, and CRMs are all powerful and very helpful platforms for any business. They all work with customer data, but the primary purpose of each solution defines how it organizes and processes that data.

If your marketing team is ready for a CDP that will enable truly unique customer experiences at every stage of the journey, check out Adobe Real-Time Customer Data Platform. Providing the very best customer experiences requires real-time insights, and Adobe does it with best-in-class data governance as well.

https://video.tv.adobe.com/v/29620

If you’re not sure which platform to use, start with the end goal in mind. Rather than asking what each platform does, ask what your team needs. (You may find that you need more than one platform.) Once you clarify what capabilities and tools you need, you’ll be ready to make the best move for your business.