By Richard Knott, SVP APAC at Infosum
Media agencies have long played a pivotal role in the advertising industry. Acting as essential intermediaries between advertisers and media owners, their expertise is in navigating the complex landscape of media channels to maximise the impact of advertising investments.
In an ever-changing media landscape, this expertise must constantly evolve and expand to best meet their clients’ needs. Right now, this means helping brands adapt to a first-party data and privacy-first environment.
The industry is facing a significant shift caused by sweeping changes to global privacy legislation, signal loss from the deprecation of third-party cookies–which have always been bad for consumer privacy and offered brands minimal control and transparency–and the rise of numerous cookie-free environments like CTV, retail media, gaming platforms, display on Safari and Firefox. As a result, the tide has firmly shifted toward the use of first-party data to drive marketing outcomes.
Consequently, data collaboration is becoming increasingly essential, necessitating a data clean room solution – a secure and privacy-centric environment that enables collaboration between multiple parties using first-party data without ever sharing it.
To date, data clean rooms have been leveraged by first-party data owners, such as brands, media owners or data providers. However, over the last year, we’ve seen an uptick in the number of media agencies, both holding companies and independents, that are leveraging our data clean rooms for their clients.
This adoption has been driven by two key factors:
Driving innovation
It’s worth emphasising that a data clean room is a technology and not a product in and of itself. Whilst you need one to enable first-party data alliances and collaboration, it’s what you build on top of it that is the game changer.
This means that right now, data clean rooms are predominantly a place for experimentation as marketers explore new online identity solutions, targeting methods, and measurement strategies to enhance customer profiles.
Media agencies have a long history of innovation and sit at the intersection of buyers, sellers and technology providers. As such, they’re well positioned to help explore and experiment with what is possible. Furthermore, as solutions can be plug-and-play, they give agencies hands-on capabilities to generate insight, plan campaigns, measure success and facilitate transactions for media activations. This is a win-win situation for brands that may not have the bandwidth or capability for extensive in-house experimentation, but are no longer willing to cede control of their data to third party agencies.
This is particularly interesting to CMOs as they are urged by many industry leaders, most recently Sir Martin Sorrell, to regain control of their first-party data from external agencies. Data clean rooms ensure that agencies never have to take ownership, control, or liability for accessing their clients’ raw data but still allow agencies to work hand-in-hand with brands to drive innovation and improve outcomes.
Agency differentiation
It’s no secret that the role of media agencies is in constant flux. Margins are being squeezed, and agencies must find new ways to differentiate themselves.
Data clean rooms enable agencies to demonstrate value to clients in a competitive market as their usage drives improved marketing outcomes across all media use cases. To contextualise, our clean data room has been shown to deliver an average of 3x return on investment within just three months of implementation, meaning agencies can swiftly prove worth.
Further, as agencies often have their own first-party data assets and partnerships, they can also augment and differentiate a clients’ data strategies. For example, Omnicom Media Group’s data arm Annalect implemented our data clean room solution to enable them to incorporate data from other vendors to gain a more comprehensive understanding of consumers as its existing Data Management Platform (DMP) alone couldn’t deliver the granularity and the depth of breadth of data attributes it required.
A key driver of their decision was that once in a data clean room environment, there’s no limit to the potential number of first and second-party data sources that can be connected and analysed. As a result, it becomes straightforward to experiment with affinity and lookalike tools. For example, creating expanded segments based on audience behaviors like watching similar TV shows, purchasing similar products, visiting the same types of restaurants, or taking comparable commutes.
The future of data collaboration
The ability to navigate and innovate with first-party data will increasingly become a key determinant of marketing success. Data clean room solutions offer media agencies an opportunity to become indispensable allies and innovators for brands in a privacy-first, data-driven world.
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Top image: Richard Knott