How Does a Data Management Platform Work? A Detailed Look

Are you wondering how does a data management platform work? Well, you’re in the right place! At its core, a data management platform (DMP) is a complex piece of software that’s able to handle large amounts of data and incorporate many different components.

A data management platform is believed to be the holy grail for a business. Why? It holds all the valuable data an organization needs to operate and innovate. The organization’s leaders make important decisions based on this data.

In short, a data management platform helps you and your organization capture, integrate, and report data. (By data reporting, I mean creating reports or exporting data.)

This post will help you understand what a data management platform is and how to implement one. First of all, let’s discuss how a data management platform works.

What Is a Data Management Platform?

A DMP is often designed to be pluggable so you can further customize it. Every plugin focuses on capturing specific data and storing it inside the DMP.

For example, let’s say you want to keep track of your company’s tweets. For this, you can look for a Twitter plugin that lets you capture Twitter data. The idea is to add this plugin with as little effort as possible. The only thing you have to do is give the plugin access rights over your Twitter account. In most cases, you can do this through a graphical interface.

A DMP is designed to collect and manage data. Here are a few data examples:

  • Social data, such as the number of likes a post received or the number of followers an account has.
  • Customer data, such as contact details, purchase history, or record of which emails your organization has sent to a customer.
  • Website-related data, such as analytics or website statistics.
  • Data about customer interactions, such as keeping track of the people your company has contacted before, listing the emails your organization has sent out, or analyzing why a particular person is important for the company.

Next, let’s explore why a DMP is so useful.

Why Do You Need a Data Management Platform?

A DMP allows you to capture advanced information. Anyone can create an Excel sheet to aggregate data about customers. However, a simple Excel sheet doesn’t come with advanced tooling. For Excel, you can create custom filters or even develop special functions yourself, but this approach isn’t very scalable.

If you’re part of a larger organization, then you need a tool that’s able to scale easily.

Imagine you’re working with several people at the same time in an Excel sheet. This situation is a big risk for data inconsistency. In contrast, a DMP allows your organization to capture more advanced data. Instead of capturing only name, address, and email, you can also capture IP address, the OS of the customer’s mobile phone, or even the customer’s online behavior.

Besides that, a DMP gives you more advanced controls, such as:

  • Easy creation of new data silos
  • Data health checks by scanning for duplicate entries or missing information
  • The ability for multiple people to work simultaneously on the same dataset
  • The ability to expose data through application program interface endpoints to other tools
  • Letting other applications update information in the DMP through API endpoints

In short, a data management platform provides you with a centralized tool to capture offline and online data. (You may want to learn more about the basics of data management and the steps in the data management process.)

Next, how can you use all this captured data?

What Can You Do With DMP Data?

First of all, personally identifying information is very useful for marketing purposes. You can use this data to understand a person’s needs and target him or her with specific advertisements or deals.

Therefore, a data management platform contributes heavily to marketing operations. A lot of the data that you capture through a DMP can be directly used in marketing efforts.

For instance, let’s say you’ve sent out two marketing emails to a specific person, and that person has clicked once on a call-to-action link. After two weeks, you decide to send this person a follow-up email that has a discount. Marketing experts call this funneling. It’s a common technique in which you keep track of the full interaction history with this person.

What uses does DMP data have besides improving your marketing? Business leaders often use this data to help them make key decisions or improve existing services. For example, DMP data might show that there’s a clear need for a new service, or it might indicate that an existing service is barely used. Also, DMP data helps you improve processes to increase your revenue.

Next, let’s explore how you can implement a data management platform in your organization.

4 Important Steps to Implement a Data Management Platform

When your organization wants to migrate to a DMP, you’ll have to think about how this tool will work together with the existing processes. Also, it’s important to build a compelling case for why you want to track specific data and how you’ll use it. Therefore, let’s explore four important steps to consider when implementing a data management platform.

1. Make a Clear Business Case

Without a clear business case, you can’t get started with a DMP. First, you need to define a business case that explains why your organization has a compelling need to capture certain specific data. If you’re just capturing data for the sake of having it, then you’re doing it wrong. Data collection requires time and effort from your employees that they could spend on more important tasks.

Your business case should explain what you want to use this data for. A clear business case helps you keep your focus. You can start by implementing a DMP for one business case and later expand to multiple business cases. However, I recommend starting simply with only one.

After you’ve defined the business case, spend time thinking about the implementation details.

2. Think About Analytics

During this step, you’ll have to define more specific details about how your organization will use the data it collects. Define strategies on how you can use this data. Often, it makes sense to consult different departments to ask each of them how they can benefit from the data—especially the marketing department.

Next, you can use the intelligence you’ve gained to define the plugins you need to support these analytics.

3. Consider Implementation Details

The next logical step is to think about the implementation details. You’ve already thought about the specific data you want to capture. Now, you can start to define data domains and put data into logical groups. After that, you can use the defined data domains and fields to build up your data management platform. You have to tell the DMP what data it can capture.

Also, check whether certain tools have become obsolete. For example, you may still be using a separate service to track social media data. You can most likely replace this service with a plugin, which means you won’t need this tool anymore.

Finally, think about your adoption strategy.

4. Focus on Your Adoption Strategy

The adoption strategy might be the most important step of your DMP implementation. You’ll need to verify if your organization is ready to embrace this change. This requires careful planning in order to transition smoothly to a DMP-focussed workflow. Establish a list of processes that will change, and gradually move to this new DMP workflow by changing processes one by one.

That being said, many established processes will change when you implement a DMP. For example, you’ll need to capture emails with clients and link them with the customer entity in the DMP. Or you may need to set up a tool that automatically saves Twitter reports to the data management platform.

Therefore, make sure to establish new processes and educate your employees accordingly. Also, plan ahead with the IT department so they can facilitate this change on a technical level.


If you implement a DMP correctly, it can be the most valuable asset for your organization. It can control all the important data you use for marketing, advertising, and decision making.

However, remember that implementing a DMP requires a lot of effort from employees, especially your technical team. That team has to prepare the migration to the DMP platform. Make sure to educate employees on new processes because a DMP can bring big changes in how people work.

This post was written by Michiel Mulders. Michiel is a passionate blockchain developer who loves writing technical content. Besides that, he loves learning about marketing, UX psychology, and entrepreneurship. When he’s not writing, he’s probably enjoying a Belgian beer!