There is no denying that we are entering a new age of digital marketing, one in which first-party data (1PD) will be empowered by Data Clean Rooms, or as they prefer to be called Data Collaboration Rooms.
In this article, 26's Commercial Director, Alex Blaikley, takes a deep dive into where the opportunity lies.
Firstly, what do we mean by a 'Data Clean Room'?
"The Secure Data Clean Room empowers organisations to instantly match and analyse data across unlimited datasets in real-time without sharing or moving data, eliminating the risk of exposure, leakage, or misuse."
"In prior generations of collaborative data relationships, ownership of the data was often lost as soon as data was handed over to a third party."
- Deloitte / WSJ
"Digital ecosystems are the future of marketing. Your success depends on connecting ecosystems to attract, engage, convert and retain customers."
Since 2010, the rise of digital advertising has outstripped all other media (£25bn in 2022 according to IAB UK) with video and display consistently growing fastest on the back of innovation, but also as a reflection of consumer behaviour. The old saying in advertising is still true; ‘revenue follows eyeballs’.
Privacy and ad fraud threatened to derail the digital advertising industry over the last few years, however, Google’s decision to sunset third-party cookies on Chrome this year has really expedited the role of data clean rooms as a solution to not only future-proof, but enhance your marketing strategy.
In 2022, Google announced a partnership with three leading Data Clean Rooms; Habu, InfoSum and LiveRamp named Google PAIR. Via PAIR, a brand can run programmatic campaigns on Google properties, excluding their existing customers (1PD). These partnerships are supporting Google by enabling data clean rooms in BigQuery, bringing the opportunity a lot closer to existing solutions and tech integration for emerging and connected brands.
Data clean rooms such as Infosum can provide brands a ‘bunker’ to match their 1PD with Nectar customers and deliver highly-targeted campaigns through the likes of Channel 4 and ITV as well as Boots and Asda.
Data Clean Rooms offer much more than effective delivery
All marketing is performance marketing. It depends on how quickly you want it to pay back.
For years, industry bodies and marketing experts have talked about the 60/40 rule for planning media campaigns. 60% of your marketing budget should be spent on brand-building activity, whilst 40% on sales activation or performance marketing.
Data Clean Rooms offer marketers the opportunity to plan and deliver campaigns to new or existing customers with a high degree of accuracy. The more a brand can layer its 1PD with partners, the more its audience segmentation becomes a source of competitive advantage. Why plan campaigns on ‘rules of thumb’ when there are far more personalised options available?
At a recent partnership event, Maria Thorpe, our Head of Data Science, presented a roadmap for brands to empower their 1PD through Data Clean Rooms and help marketing teams truly align with their IT, legal and sales functions, putting the customer at the heart of the business and future business growth.
"I love the idea of partnering with different organisations to grow our customer base. InfoSum presents an opportunity to do that."
– Rav Mall, Database & Analytics Manager at Mitchells & Butlers
"Our key goal this year is to drive brand awareness, we can see a route to this via partnerships facilitated by data clean rooms, such as InfoSum."
– Deonne Bateman-Smith, Global Head of DTC at Maybourn Group Limited
But not every brand will be ready to embrace Data Clean Rooms. Not every brand will want to…
"To embark on a Data Clean Room implementation, organisations should consider assessing their readiness in three key areas: commercial, customer, and technology compatibility."
– Deloitte / WSJ
What's our approach at 26?
At 26, we use a digital maturity index to guide sustainable growth for our clients. We tend to see clients in the ‘emerging space’ start to use 1PD in areas such as customer match, as well as audience and creative development. However, whilst a Data Clean Room isn’t only for brands with advanced CRM and 1PD, it will require a level of maturity and commitment to longer-term outcomes before we’d suggest buying into a bunker.
At some point in the future, the ability to understand, or even see, what a competitor is doing from a marketing perspective will be significantly harder – if it isn’t already. In 2016, whilst at Google, we stopped trying to present search and display benchmarking data at agency level, as the multiple bid strategies employed and objectives made the comparisons moot. As digital ecosystems continue to grow independently of one another and brands increasingly use 1PD to power all aspects of their marketing, it becomes less about competitor activity driving change, but change from within – led by marketing.
Much like you wouldn’t buy CTV inventory without a clear idea of what creative messaging to use, one wouldn’t buy a bunker without an outcome in mind. However, for brands with a test-and-learn culture and approach to marketing, renting a bunker for 12 months will support multiple business cases, encourage collaboration, and provide a source of competitive advantage when third-party cookies sunset later this year. The cost of renting a bunker for 12 months is not overly prohibitive, and whilst a business case will need to be made, the opportunity- cost of not embracing it will be felt over the next 2-3 years.
"In many instances, the information required to make large and decisive investments in the face of disruptive technology simply does not exist."
- Clayton Christensen, The Innovator’s Dilemma, 1997
I’m not sure when the next paradigm shift or genuine disruptive innovation will occur in our industry, however, the ability for brands to have confidence in their marketing from a consent perspective, whilst increasing efficiency, personalisation, incrementality and effectiveness is something that will sustain growth for the foreseeable future.
Want support in defining and activating your first-party data strategy? We're offering brands the opportunity to speak with one of our consultants to understand the data collaboration opportunity and use cases for your organisation. Get in touch.
Want to read more? We've compiled a few resources that you may find useful:
Secure and privacy-centric sharing with data clean rooms in BigQuery – Google, March 29th 2023.
Is Your Organization Ready for Data Clean Rooms, Wall Street Journal & Deloitte, June 2023.
Data Collaboration Playbook for Brands – InfoSum.
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