CRM vs. CDP vs. DMP: Understanding the differences for your marketing goals | Simon AI

CRM vs. CDP vs. DMP: Understanding the differences for your marketing goals

Author: Lauren Saalmuller
Content Marketing Lead

Table of contents

What is the difference between a DMP, CRM, and CDP?

A data management platform (DMP) stores, organizes, and manages data from first-, second-, and third-party platforms. This data is often anonymized and used for marketing tasks like audience segmentation. Storage is short-term.

On the other hand, a customer relationship management platform (CRM) is designed for sales. It gathers prospect information through the direct contact customers have with your brand.

Like a DMP, a customer data platform (CDP) is designed for marketing. However, the data CDPs gather is typically persistent. A CDP gathers this customer data from several different sources to build a unified view of your customer so your team can precisely execute marketing strategies.

To sum it up:

CRMs are tools for gathering customer information to initiate direct contact with these customers
DMPs gather and manage short-term data for marketing activities
CDPs build persistent profiles of your customers for marketing activities

How DMPs, CRMs, and CDPs collect customer data

Every business ingests some form of first-party data — data that’s provided directly by the customer. This may include contact information like phone numbers or emails, job titles, names, purchased products, subscriptions, or even addresses.

CRM data is usually gathered manually. This means sales development representatives (SDRs) gather contact information through sign-up forms, emails, social media interactions, or surveys.

On the other hand, CDP and DMP data is collected automatically through avenues such as web tracking, mobile apps, APIs, and integrations.

What’s more, DMP data is rarely first-party, and what first-party information that is gathered is anonymized.

Not all platforms are created equal!

What are the benefits of a B2C CRM?

Marketing is tough, and competition is fierce. A sales team would have a hard time keeping up with the complexities of modern marketing without a good customer relationship management platform in place. Let’s look at the most significant benefits of using a CRM:

More consistent customer interactions

A CRM helps you stay at the front of your prospects’ minds by constantly staying in touch with them — whether by email, direct mail, or targeted campaigns. With CRM automation, salespeople stay on top of each account, communicating with leads at optimal times and anticipating objections.

Improved customer loyalty

No customer likes feeling like a number, and a CRM ensures that you treat every customer as an individual. A good CRM will help marketing teams track details about their interactions with each customer so that they can build better relationships.

Improved decision making

A customer relationship management system offers reporting and analytics features for improved, data-driven decision-making. Good CRMs often include near-real-time data capture, guiding your customer journey with a better-informed sales process.

Who should use a CRM?

Are you a sales or billing team? Do you offer customer support? Then you’re the best candidate for the features and tools offered by a CRM.

If you send quotes or work with outbound marketing strategies to contact potential customers who require direct interaction, a CRM is designed for you. CRMs enrich customer-facing roles by arming them with data, automation, and a single view of the customer.

It’s important to note that CRMs and CDPs can work in tandem. In fact, depending on your marketing goals, it’s often best to integrate both into your workflow.

CRM example: Salesforce

One of the best examples of a CRM is Salesforce. As the leader in the CRM industry, Salesforce helps sales, service, and marketing teams deliver an exceptional customer experience through automation and features that speed up the lead outreach process.

What are the benefits of a DMP?

DMPs do some of what CDPs do, and, as a result, they’re helpful for paid advertisers just looking to sort through second- and third-party data or marketers who want to segment their audience. Here’s how DMPs help marketers:

Better organization with centralized data

Much like a CDP, DMPs centralize your data. The difference is you’ll usually have this data anonymized and for the short term.

Audience segmentation for more personalized marketing

A DMP offers segmentation so you can divide your audience into buckets based on real-time data. Rather than sorting for this information yourself, a DMP can do this in seconds and update information regularly.

Better audience insights using second- and third-party data

A DMP can serve you insights from your third-party and second-party data to help you identify audiences you’re missing or neglecting.

Who should use a DMP?

DMPs are particularly helpful for those working in the paid media space. DMPs quickly serve anonymous data that can help you target new groups.

DMP example: Lotame

There are a lot of DMPs out there, but Lotame is one of the most popular.

What are the benefits of a CDP?

Using a customer data platform for your marketing campaigns determines whether you reach your key performance indicators (KPIs) or fall short. A CDP offers several benefits:

Removal of data silos

Data becomes harder to use when it’s siloed inside different sources and applications. For improved messaging and more proactive marketing campaigns, a CDP works to unify this data — whether it’s zero-, first-, second-, third-party, online, and offline data.

Deeper customer insights

A customer data platform enables marketers to build comprehensive customer profiles that offer insight into real pain points, interests, wants, needs, and even firmographic data (the equivalent of demographic data for B2Bs).

Savings through automation

Automation takes repetitive yet critical tasks off your to-do list, saving you time and resources so you can focus on higher-ROI initiatives.

Increased personalization

Today, marketing is all about personalization. About 75% of consumers are more likely to purchase from a business that offers them a personalized experience.

Better prediction with ML and AI

AI and ML enhance personalization in marketing campaigns, and the ability to predict the wants, needs, and, in some cases, actions of its customers takes any brand’s marketing efforts to the next level.

Who should use a CDP?

CDPs combine zero-, first-, second-, and third-party data for more effective behind-the-scenes marketing. Marketing channels like social media, email marketing, SMS, and pay-per-click (PPC) make CDPs ideal for marketing teams who want to grow company revenue, expand market share, and market new product initiatives.

CDP example: Simon Data

The Simon Data CDP is designed to help marketing and tech teams deliver results in the form of new customers and better retention.

CRM vs. DMP vs. CDP: Key differences

While both platform types process data for the best sales outcomes, they have some key differences. CRMs shine in:

Increasing customer lifetime value
Improving customer service
Gaining insights into customer behavior

DMPs give you these benefits:

Better organization with centralized data
Audience segmentation for more personalized marketing

And on the other hand, here are some ideal CDP uses:

Activating real-time, zero-, and first-party customer data you already have
Executing data-driven marketing campaigns
Unifying and segmenting your customer data

These distinctions can empower you to build a martech stack with confidence.