CDP vs DMP – What’s the Difference?

מה ההבדל בין DMP ו CDP
It seems that nearly every day, a new platform or technology that you “have to” include in your organization’s systems emerges. And alongside the flood of new technologies and platforms come seemingly identical acronyms (in English). Sometimes, people interpret/translate/attribute different meanings to the same expression or acronym, and sometimes, only very few people, generally platform owners, know how to differentiate among them. It is important to indicate that in most cases there are differences between the platforms and their uses. For example, the terms CDP and DMP. If we examine their definitions as written in the dictionary, you’ll find very slight differences:

DMP – data management platform – technology platform used for collecting and managing data, mainly for digital marketing purposes. It allows to generate audience segments, which are used to target specific users in online advertising campaigns

CDP – customer data platform – software which creates a persistent, unified customer database that is accessible to other systems. Data is pulled from multiple sources, cleaned and combined to create a single customer profile.

And yet, it is still important to make that distinction.

How are they similar?

  • Both platforms gather and manage data or big data, in most cases.
  • The platforms are used to create quality segments and profiles for future use by in marketing activities between the brand and the customer.
  • Most of the data handled by both platforms is digital data.
How are they different?
DMP CDP
Type of Data Mainly used for 3rd party data, purchases and sales Mainly used for 1st party data
Segmentation Manages data on a segment level Manages data on an individual user level
Use Focuses on paid promotion Focuses on personalization and multichannel processes
Customers Suitable for large companies or organizations that spend a lot on media buying Suitable for medium to large organizations
When should you use each of the platforms?

DMP – Companies looking to sell/buy data from external (3rd party) websites and use it for large-scale online marketing purposes and launch activities at once, or shortly thereafter.

CDP – Companies that want to use their data (from all sources) to create a personalized customer experience and complex media processes, in moderate to lengthy timelines. CDP technology is newer and remains in its infancy with respect to B2B companies.

In light of licensing costs and the (low) media usage of most Israeli companies, CDP technology is much more relevant than DMP technology for most brands. As such, we expect to see significant CDP penetration in the coming years.

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