The Lumascape continues to shape-shift. No sooner are new categories created (e.g. viewability, attribution) to solve emerging problems than the companies in those sectors are swallowed up by the big players in advertising and technology. Many of the logos on the Lumascape are already owned by digital behemoths.
In 2016, these giants – Google, Facebook, Apple, Yahoo, Verizon, Twitter – will continue to expand through acquisition. There are a number of factors fuelling these acquisitions, including innovative technology and patents, a valuable user base, or preventing a competitor from making an acquisition. But no factor is more potent than the race for data.
Why is the data race heating up now?
People today are more connected than ever, interacting with brands all day long on devices, the web, and in person. All of these interactions send signals to brands and publishers about what consumers want and need in the moment. This is the new battleground: reaching always-on consumers who are demanding right-now relevance.
Winning in this atmosphere requires a new approach to data-driven marketing, which Internet giants have certainly caught on to. The day is coming when cookies will no longer be a useful way of reaching customers because they don’t work in all environments – particularly in mobile – and they can expire or be deleted. It’s increasingly difficult for marketers to achieve a single view of cross-channel customer identity that is durable for the long term and continuously enriched based on interactions across all touch points.
It was in preparing for this day that people-based marketing was born. With a people-based marketing approach, advertisers and publishers can reach individuals rather than broad demographic categories or a nebulous collection of cookies.
Each walled garden has its own “people-based” offering. Facebook’s Custom Audiences has been a digital starting point for many brands trying to reach known customers, rather than cookies. Twitter offers a similar service, Tailored Audiences, to reach its users. And late in 2015, Google rolled out its Customer Match targeting option for advertisers to reach individuals via email addresses tied to Google accounts.
Where are walled gardens heading?
With an estimated 50% of all advertisers’ spend on digital ads in the UK predicted to go Facebook, Google and Twitter in 2015, recent response to people-based solutions has been positive. But for these walled gardens, it’s not enough to be big and powerful. They need to keep growing their ad revenues—which fuels their need to constantly grow the audience and data within their walls. The ultimate goal? To amass enough users and data to show an ad to just about anyone at any time so advertisers have no need to go anywhere else.
Over the next few years, these giants will put together comprehensive advertising stacks that could drive niche players out of the market. We’ve already seen clear examples of the market shrinking: when Yahoo bought BrightRoll and Millennial Media, it consolidated three major video advertising platforms into one.
Where does this leave advertisers?
This consolidation is mixed news for advertisers. On one hand, as the behemoths continue their global expansion, brands will have new ways of reaching more and more of their customers in more places on those platforms. But consolidation is also likely to reduce their choices, buying power and visibility into their own customer’s journey within these walled gardens.
When working with walled gardens, advertisers should ask themselves the following questions:
What are my blind spots? If you’re running ads on Facebook, you won’t get all the data you need to close the loop on your marketing attribution at the customer level. Be aware of what you can’t see when you work with walled gardens.
What can I do with my own data? Learn from the big guns and take stock of all the data you’re already collecting. Are there ways you could be connecting your first-party data to reach customers across channels, at every point on their path to purchase?
How can I keep control of my brand’s identity data? If you’re relying on Facebook to find your target audiences across devices, then you’re losing visibility and control of your customers, and ultimately losing your ability to create a single view of customer identity. But, if a brand knows its customers through unified, actionable customer profiles – and owns those profiles rather than renting them from a third party – the possibilities for effective marketing now and into the future are limitless.
Can I do people-based advertising outside of Facebook? There are new ways to pursue people-based marketing outside of walled gardens. One approach is collaboration, through which trusted partners can reap the benefits of contributing to and using a secure data and identity network (where they make the rules) to accelerate targeting of known customers at scale.
The media landscape is certainly changing, and because these walled gardens are some of the largest media platforms in the world, the atmosphere for advertisers is changing too. Brands should carefully consider their media strategies to ensure they’re getting the best return on their ad spend now and into the future.
