• by Jay Friedman , Op-Ed Contributor, November 2, 2016

Much has been written about the walled-garden concept, where Google or Facebook only allow the data and/or inventory they’ve created to be used within their buying ecosystems. This worries marketers for many reasons. First, it makes buying less efficient, by having to plan and buy multiple times rather than through one system. Second, it prevents marketers from controlling ad frequency or messaging sequence across properties. Third, it makes these companies play prosecutor, jury and judge with their metrics, data and reporting.

Google and Facebook have been taking the heat for being walled gardens, but what about others? For example, does WPP’s recent acquisition of Triad Media cross over into walled garden territory? Let’s explore.

It bothers some buyers that when buying Google, a marketer’s ad is served in DCM (Google’s advertiser ad server), bought through DBM (Google’s demand-side platform), then AdX (Google’s ad exchange/supply-side platform) and served on the publisher side through DFP (Google’s publisher ad server.) Each of these is a Google product. It’s not a leap for a marketer to be concerned there may exist preferences within one Google product for another. And as the recent header bidding/EBDA scuttlebutt showed us, such a concern is probably not far-fetched.

The problems here could range from benign to pretty darn terrible, but Google’s scope is typically limited to the technology components and doesn’t extend into services. This is where WPP is different.

WPP owns or has a significant stake in the following:
-- Media research and spend measurement (Millward Brown/Kantar)
-- Media planning, buying, and execution (hundreds of agencies)
-- Advertiser and publisher ad servers (Medialets/Appnexus)
-- Ad exchange/supply-side platform (Appnexus)
-- Demand-side platform (Medialets/Appnexus)
-- Attribution (Medialets)
-- Media measurement (comScore)
-- Publisher representation (Triad)
-- e-Commerce data-management platform and measurement (Triad)

This means that WPP can control an ad being served, bought, and subsequently measured, represented, researched and attributed.

This isn’t just prosecutor, judge and jury. This is prosecutor, judge, jury, bailiff, court stenographer, the press and the prison bus driver.

Of course one-stop shopping has been a selling point for thousands of businesses over time. Having reduced red tape and friction between entities could mean increased efficiencies and faster time to market for WPP clients.

The question to explore is how such practices impact our industry.

Remember, the DOJ vs Microsoft case, which accused Microsoft of monopolistic practices for bundling Windows and Internet Explorer while suppressing competition and API access, was less about the exclusive control of a resource or service and more about the practices concerning access and coercion.

So here are the questions I believe we should consider as an industry:

1. Can the other holding companies compete without following WPP’s path? The answer will depend on marketers’ responses to the holding company’s strategy. If they flock to WPP for these resources, other holding companies will have to follow suit, but may be in trouble. There is a tremendous advantage to being a first mover in acquiring companies within limited-depth spaces. If marketers move away from WPP, it’s clear other holding companies are doing something right by being different.

2. What safeguards do current WPP (or Google, or Facebook or Amazon) clients need to put in place to ensure best-in-class solutions are always used to extract maximum value from their marketing investments, rather than defaulting to internally owned/invested partnerships? And this doesn’t even get into walled-garden/pricing/transparency concerns marketers may have.

3. Does the government need to get involved? Probably not at this point. Marketers have too many other comparable choices and alternatives. Within other walled garden platforms, though, the fact that data, inventory and buying platforms are inseparable very likely begins crossing into monopoly territory.

These are interesting times in that there is no marketing-related historical reference point sufficiently similar to use as guidance. In the meantime, marketers heavily invested in companies straddling this line can add one more thing to consider to their already overflowing list.