Earlier this year, ExchangeWire conducted research, in association with Lotame, looking at the global adoption and use of DMPs within agencies. In this piece, we discuss high-level findings – click here to read the full report.
The presence of DMPs within the agency ecosystem is widespread. Globally, 79% of agency-side media buying professionals use DMP technology. There is little regional variation (EMEA 76%; APAC 81%; US 80%).
This figure can be viewed as very strong, especially given that research we conducted in July 2015 showed 53% of media buyers had a DMP solution in place – representing an increase of 26% in just two years. This is symptomatic of agencies’ desire to increase their competitive edge. As the amount of data that agencies hold at their fingertips rises, an umbrella solution is becoming a necessit, nowadays.
Despite what can be considered high adoption rates, 21% of respondents still say they do not have a DMP. Price is the biggest issue for non-adopters. Globally, 39% cite price as a reason they have not implemented a DMP.
Globally, we see DMPs are primarily used by agencies for audience targeting (62%), audience insights and analytics (53%), and data unification (33%), which is not surprising as these are all rather elementary use cases of the DMP technology.
Almost a third (32%) of respondents use DMPs for content and experience personalisation, 29% for cross-device attribution, and another 29% for creative and messaging optimisation. Today’s high adoption rate for DMPs within the agency ecosystem (79%) means there is “little competitive advantage to be gained by basic DMP integration and use” according to Andy Monfried, founder and CEO, Lotame. He explains, “DMP adoption in agencies is at an all-time high, so while the competitive advantage of simply having a DMP has decreased, the differentiation now lies in HOW agencies are using the DMP. Those who are harnessing the full capabilities of the technology are seeing greater efficiency, effectiveness, and success.” With this in mind, we asked our contributors how they are using their DMPs, beyond the more traditional use cases.
However, DMP adoption is no longer enough for agencies to achieve differentiation, with such a high percentage of competitors having very similar technology, and there is a clear gap between adoption and execution:
- 57% of respondents say a DMP is only "nice to have". We hypothesise that this group is adopting DMP technology to keep up with competitors, but are not making the most of its capabilities
- 33% of respondents rank DMPs as "vital" to the tech stack. We hypothesise that this group is making the most of the DMP’s capabilities.
Our data supports these theories:
- A third (30%) of our "vital" group are highlighting their ability to improve data strategy in over two-thirds of pitches. By comparison, only 20% of those who rank DMPs as "nice to have" use data strategy to the same extent
- Those who rate DMPs as "vital" are more data-intensive on every channel, than their "nice to have" compatriots
A regional divide
This report highlights the differences in advanced use cases for DMPs across each of the regions we studied:
US: Agencies in the US are the most advanced in their use of DMPs. Our hypothesis is that this is due to the fact they adopted the technology earlier and mastered the basic use cases; they are now moving on to more advanced ones. For instance, US agencies have mastered data management using online data sources and are now expanding to other channels, with a particular focus on bringing offline data sources online. While the collection, analysis, and activation of cookie data is now mainstream among US agencies, the more advanced players are combining those online data sources with other new high-quality data sources, in an effort to differentiate themselves.
EMEA: The fragmented nature of the EMEA market means that agencies here are looking to the DMP to combine data sources, and integrate data from different markets. Moving beyond the more basic use cases, however, agencies in EMEA have begun to realise the opportunity to improve their, and their clients’, knowledge of audiences, through sharing the insights gleamed from the DMP. This will help them stand out to clients as brands seek more data-driven strategies from their agencies.
APAC: Despite adopting DMP technology relatively late on, agencies in APAC have quickly learned from other regions who invested in the technology earlier. They are using this knowledge to quickly catch up with other regions when it comes to advanced use cases, such as content and experience personalisation (37%) and feeding data into the creative design process (27%).
At present, though DMP adoption is very strong around the globe, there are a number of agencies that own a DMP, but are not making the most of its advanced capabilities. Having a DMP is now almost table stakes for data-driven marketing agencies to offer accurate targeting, data unification, and audience analytics and insights to their advertiser clients. The agencies that will rise to the top will be those offering clients advanced data strategies, such as content and experience personalisation, cross-device attribution, sequential messaging, and creative and messaging optimisation. If brands are to be able to continue to build out their data strategies, agencies must begin to leverage the DMP’s more sophisticated use cases.
Click here to download the full report.