As GDPR enforcement becomes a reality not only in Europe but also here in the US, advertisers are struggling to find a way to scale the walled gardens and optimize their data assets.
Google wasn’t the only one to lock down their platform. In response to the combined pressure of GDPR and the Cambridge Analytica scandals over its handling of personal information, Facebook decided that it would shut down ad tools called “Partner Categories” powered by outside data brokers. Those tools let Facebook advertisers target ads at people based on third-party data such as their offline purchasing history. This means advertisers will have access only to their own data and data Facebook collects itself. If an advertiser wants to pull campaign-level insights to inform future campaigns or use the data for the basis of an attribution model then they are out of luck.
Data clean rooms allow large inventory partners like Facebook and Google to share customer information with brands, while still maintaining strict controls in place. Data clean rooms were named for the completely airtight rooms where microchips and other sensitive materials get made. In this case, the rooms enable a shared environment between two or more companies that is completely secure from external access (no wifi) where each company decides the level of visibility to their data. This eliminates the possibility of data leakage for companies like Facebook which caused the Cambridge Analytica mentioned earlier.
“We and a partner combine a data set with very specific rules and controls around how each party can operate within the shared environment,” said Scott Shapiro, a product marketing director for measurement at Facebook, who noted that Facebook didn’t invent the clean-room concept.
The concept is to create a safe space where data can be share and manipulated without leaving the inventory partner’s environment. Specifically for Facebook, a brand can create an audience based on first-party data, like a list of email addresses and then push that list into Facebook, match it, and grab a copy which they can later combine with their data as the basis for attribution, measurement and modeling.
How it happens in reality is that an advertiser will lead a clean or wiped laptop or device that has never been connected to the Internet with that advertiser’s first party data, which in most cases is an email list. A second clean computer is loaded by Facebook or Google with impression-level and non-PII campaign data.
Maybe, The Answer to Scaling The Walled Gardens?
For advertisers with a lot of data and substantial programmatic advertising budgets this is a great opportunity to scale the otherwise elusive walled gardens. The data clean rooms create a safe environment for data providers to share the marketing data that brands need and crave to model future media buys and advertising strategies. If managed in the right way, with the right methods and standards, this would be the tool for brands to really understand their walled-garden ad spends within the larger marketing ecosystem. For advertisers and publishers there is a lot at stake in the post GDPR world of data governance. There is no room for unintended data sharing because the consequences are too great.
Marketers have been eager to get more insights out of Facebook and other walled gardens but it’s unclear how many brands or agencies will take advantage of this opportunity to get more out of their spend with the largest inventory providers. From Facebook’s perspective they are not advertising the data clean room solution because if they gave advertisers too much access to data buyers might eventually become less reliant on their platform for scale and identity data. But Facebook and Google also don’t want to piss off their advertisers because they are demanding more data so this is the solution that they can offer for brands that pressure them to giving them more insights. There is still the issue of the manpower involved and the fact that the data is limited to a snapshot in time but advertisers who buy into this solution are fully aware of what they are getting and have to decide if the value is worth the effort.
Our inboxes and news feeds are imploding with GDPR. It’s like Christmas for your inbox, the more sites you are subscribed to the more presents you get this week.
Let’s be honest, don’t you wish somebody would open and respond for you? How many of you have taken the time to open, read and opt-in or out of all those sites and or emails?
For those of us who, like myself, are old enough to remember, it feels like the Y2K panic all over again. While it certainly might be legit, it’s hard to really know whether the panic is real and what the aftermath will look like. Some companies are taking the wait and see approach, while others have gone down the GDPR checklist and implemented it all, and some just gave up and shut their doors, mostly because of the cost of implementation.
Tomorrow is the Day, Are You Ready?
It does feel like most people are tearing their hair out or crying a little. As they should. The real-time application of GDPR is way beyond was most people ever had in mind when they first started collecting data for advertising and just the thought of throwing out every process you ever had and starting all over is pretty daunting which is why there are many smaller shops that didn’t even bother.
So who will be left standing after the bell rings tomorrow? Who knows? Hopefully more than just Google or Facebook. Otherwise innovation in advertising technology might just come to a big stop. I for one hope that’s not the case.
Here are some of the headlines I’ve been reading that are most relevant for programmatic media buyers:
Over the past few months, the GDPR (General Data Protection Regulation) acronym has been thrown around often in the programmatic media industry, as everybody scrambles to define what it means for them and how to apply it. At least on this side of the ocean, it seems like most digital marketers are still unaware of what the GDPR is and the heavy implications it holds on their programmatic media buying future.
What is GDPR?
The GDPR Transparency & Consent Framework was launched in Europe on April 24, 2018, with the objective to help all companies in the digital advertising industry ensure that they comply with the EU’s General Data Protection Regulation, when processing personal data or accessing non-personal or personal data on user devices.
GDPR Starts Right Now
Article 4.1: “personal data means any information relating to an identified or identifiable natural person (‘data subject’); an identifiable natural person is one who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to the physical, physiological, genetic, mental, economic, cultural or social identity of that natural person.”
What Does That Mean for Programmatic Advertisers on the Other Side of the Ocean?
While companies figure out how to comply with the new rules there might be a loss of momentum with data tech innovation. GDPR will require programmatic advertisers to obtain active consent from users to use their personal information, and also give them the power to erase their accumulated historical data from any database they wish, thus being more transparent.
With the rise of Machine Learning and Artificial Intelligence, there has been a lot of progress on the way programmatic advertising technology uses consumer data to provide intelligent and automated ad targeting. With these regulation changes we might see a halt in the progress made to enable automated and personalized advertising. The implications of GDPR could somewhat restrict the extent of the role that AI-driven data insights and intelligence technology plays in the future. This will create significant challenges for the innovation of programmatic advertising. That said, it is even more important today that programmatic service providers introduce other emerging technologies with the capabilities needed to address the goals of GDPR and ensure both secure and efficient advertising.
One emerging technology that could have a significant impact on programmatic advertising and how marketers deal with GDPR is blockchain. Blockchain has the ability to create a highly secure trading network for advertisers, by publicly storing data to create a permanent audit trail with an unchangeable record of all transactions that occur within the programmatic buying marketplace. This provides marketers with full visibility into their ad buy, to better track all transactions that are taking place automatically and a record of all transactions taking place throughout the ad-buying and selling process.
Possible applications for Blockchain to abide by GDPR rules and regulations:
Trust and transparency have been leading many of the conversations about programmatic advertising, and GDPR may serve to accelerate the industry-wide push for more accountability. Blockchain is one solution but there are other solutions waiting to be discovered and tried out. Over the next several months we will see more on how the EU applies GDPR in a practical manner, so the approaches and implementation of new technologies like blockchain should become clearer.
Programmatic advertisers, marketers and publishers may be held accountable for non-compliance by third party data providers, which means all players in the ad tech ecosystem will become more reliant on one another. What this also means is that the ad-tech ecosystem will be a lot pickier with who we choose as partners and how many partners and publishers we all work with. Contracts will need to be revised to ensure compliance, and for publishers it will be an opportunity to gain leverage to demand transparency regarding the data used by any of their partners or platforms.
For more information on the GDPR, its goals, what you need to do to be compliant, and Digilant’s commitment to the regulation, download our white paper below.
On Tuesday, May 8th we hosted dinner and conversation at 230 Fifth Rooftopin Manhattan. Digilant‘s Executive Chairman, Alan Osetek moderated an intimate dinner discussion on the next evolution in integrated digital marketing solutions with digital experts:
As programmatic technology becomes a commodity that everyone is using and has access to, it’s even more important to have integrated teams and strategies to get ahead of the competition. Today’s CMO will be delivering a single media strategy that includes search, social and programmatic. They will be partnering with agencies and businesses that can help them strategize, implement and optimize their digital media across audiences, formats, screens and inventory to most effectively deliver on business goals and objectives.
Alan kicked off the event conversation by asking: What industry buzzwords or shifts do you think will impact digital marketing this year?
Chris from Underscore was the first to respond by saying that he went to SXSW in Austin this year and that Artificial Intelligence (AI) was the number one thing they were talking about. Other topics were automation of data and predicting what that’s going to look like. From a data perspective that’s what people are interested in, using data to predict how campaigns will perform is going to be key. Lauren at eMarketer agreed that AI is definitely big as well as the focus on machine learning and analytics for understanding customers and what that will look like. Other topics that will be important are transparency, GDPR, Customer Data Platforms, voice search and what that means for advertisers. Rob from Venbrook responded that from an insurance standpoint the industry is slow to move. The cutting edge people are having a field day with concepts like AI and other big buzzy words. Not a lot is happening in terms of the insurance space yet but in his opinion, if you are a B2C broker then you start looking for a job because you will be replaced by a robot. Alan summed up by saying that just like mobile, we were constantly hearing that this was the year of mobile, AI will probably take some time to really develop and there still a lot of value in people pulling the levers, but it will be interesting to see how long it will take to effect our day to day.
What consequences do think these shifts have had on the marketing organizations and the way they are structured or the type of people they need to hire?
Are companies taking steps for connections to happen internally or is it the agency or the brand doing it for themselves?
Lauren continued by saying that brands are working in tandem with their agency or tech partners, they have to be responsible to the consumer. In order to do that they have to convey the message as best they can. Publishers are also being thoughtful about their technology partnerships, because they have an even bigger responsibility to be very clear to the consumer.According to Rob, the horse has left the barn, big data has gotten away from us. As a result I think we will see a shift back to the largest publishers controlling their data… like they did 20 years or so ago. Back then advertising was controlled by publishers. When advertising was more publisher driven, publishers had the advertiser relationships and would do the data analysis work themselves and then not share this audience data with anyone. An example is with big brands like the New York Times. I believe they will focus less on “mass marketing” and more on customer engagement. The Internet at its best is a one on one medium, not a mass medium. I think there will be greater attention paid to inbound strategies akin to Kevin Kelly’s “1,000 true fans” concept. Do big brands like the NY Times want to make an extra dollar on a CPM or do they want to sell something for a $100 to 1 million people? They don’t need to go to a third party to have the relationship that they want to with their consumers.
Do you think more companies are going to be investing in marketing attribution platforms and strategies and why yes or not?
So how do we collect the data? Chris responded. Instead of attribution, we should be asking, how is your marketing working for you. We can’t just look at a specific channel, otherwise attribution is something people are always going to chase. I have not run into someone that has a model I believe in. Lauren agreed with that response. Attribution is an understanding of the health of your org, whether it’s loyalty or sales, it has to a top level business moving KPI. I am more and more convinced that the biggest challenge for attribution is not technology but the organization, how people are compensated and ultimately how they work together that’s holding up the process.
So, how do you do it? Alan asked. Lauren continued, it’s a culture shift, you need people at the company who are advocates of attribution and collaboration, it starts at the top level of the organization and moves down.
Someone in the audience asked, what do you think the impact of the announcement that Google just made, about no longer being able to export DoubleClick IDs, will have on attribution?
Alan responded by saying that you should think about the other big networks like Facebook and Amazon who are closed, Google in comparison was more open. This move makes Google more like the other players while it also helps them be covered for privacy laws. If you are using a true third party attribution solution like Visual IQ it’s not going to affect you, but if you are only on the Google stack it’s going to be harder. Chris also chimed in by saying that if you are not talking to the top level of the organization, then there is no point in trying to talk about attribution, as in the lower parts of the org they are not going to be able or want to share the data you need to make the attribution possible. Companies that have Chief digital Officers, a new role that teaches organizations about digital, have more chances to make attribution successful. Also, today we have moved further along, where more CMOs are digitally savvy, makes it easier to implement attribution.
Shifting topics, Do you think CMOs should be thinking about bringing programmatic in-house and why?
I have been at an ad agency my whole career, started Chris, you can make it work but the talent will get stagnant. My experience is that you need to work on different things to make your career and company grow. The challenge is to find the same quality of talent in-house, that you would get at an agency that has a variety of projects and talent. I’ve thought about it for myself, if I moved to the brand side I would be doing the same thing in 5 years, not able to improve or grow. Lauren added that she is hearing a lot about in-housing but what’s really behind the momentum might be the impression of cost savings but in reality it’s the data question. As more people use first party data there are implications of where you put that data. Thinking of a lot about the guaranteed buys, premium video, you don’t want to put your data on open market. The strategic piece is an edge a lot agencies have because they are in the marketplace and have access to all the best inventory even, if the buying does move in-house. Chris added that it also comes down to the kind of talent you have, you are never going to be as cheap as the big guys, but we are going to be better, because it’s not a 22 year old running the business. Clients are investing in data and insights but not doing it alone, with the agency providing all our media data, they can apply it to the data on their side, letting them see a complete picture. In the past client and agency data were two separate data silos so they couldn’t put the picture together. The biggest shifts for agencies was to actually share their data to keep their clients from wanting to leave them.
Alan also added the at Digilant we noticed that people who are ramping up on our self-service platform nine out of ten times they don’t manage their actual campaigns and still need help to read and look at the data. On the other extreme companies are starting to hire data scientists who are experts at reading data. There is nothing really in the middle, you have to share the data. It’s a partnership, the technology and the agency are an extension of the brand. Brands are more willing to pay for data analyst than media buyers, according to Chris, even though the young people have no idea what they are doing, companies don’t see the immediate value of media buying experience. In the immediate future, brands want us to do the work and be pro-active on supporting them and telling them next steps, concluded Alan.
How are you defining transparency within your organization?
Transparency has been a huge battle for me internally for the last three years, said Chris. We are opening up the books now, data doesn’t lie and actually the opposite, it helps create a trust. It also puts other agencies on the spot if they don’t share their data with their clients. For Lauren there are several definitions for transparency, like tech tax, who is getting what cut, it’s a cool concept but for most companies if they actually had that data they wouldn’t know what to do with it. Most companies don’t have the right people who know what reporting should even look like. There are a lot of layers to it, but overall the vast majority, if they were given the info wouldn’t know what to do with it. For Rob there are two types of companies, ones who say they care about transparency but do nothing about it and others who are actually doing something.
As a last question Alan asked, what can marketers be doing with their display creative to enhance their media buys?
Chris said that cost is the number one challenge, our company doesn’t do creative, so how do you produce eight sets of banners, it’s too expensive. Creative makes the most sense to bring in-house, so that you get the ability to tell them what to do and don’t have to invest more money, that’s going to be the biggest challenge – taking a chance on a campaign though one creative. Lauren added that the sheer production of all the assets, and then the strategy is cumbersome, on top of what data am I using to power the campaign. For some it’s a legal thing, how do you get it all approved? For others, without understanding of the customer journey it becomes a gamble. Rob finished by saying that he agrees with Lauren and Chris, the customer segmentation process can be the holy grail or a nightmare, having an in-house creative team is a great idea and there are tons of creative people out there who want jobs.
Again, thank you to our wonderful panelists. We look forward to our next events in Seattle, June 5th, and Boston, June 12th. If you are interested in attending or speaking please reach out to us firstname.lastname@example.org.
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