The advertising industry has been reduced to a whirling, swirling deluge of tech vendors. Each fulfills one, or maybe two, needs at a time.
So many black-box vendors smashing technologies together to run a single ad campaign is causing problems. Costs rise as performance wallows in mediocrity. Viewability, fraud and brand safety remain sore subjects. And when things fail, no one knows who to blame, because no one really knows who’s doing what.
It’s confusing, frustrating, and dumb. Call it the “advertising industrial complex,” (AIC), a play on President Eisenhower’s memorable 1961 speech warning of “the acquisition of unwarranted influence… by the military–industrial complex.” Eisenhower feared the military would become too bloated, and today’s ad industry elicits similar fears.
While data has promised to target the “right consumers at the right time,” using it is more complicated. Advertisers prefer first-party data because it’s linked to a real person. However, the instant data is passed multiple times between third-party vendors, it’s anonymized, diluted, and otherwise corrupted. Advertisers no longer know whom they’re targeting, and have no way of accurately attributing ad spend to actions taken.
Yet, as in the dire scenarios of legend, there are would-be heroes who right wrongs and save the world. In this story, we have two: the walled gardens of Google and Facebook.
Google and Facebook have consolidated the mess into singular marketing technologies fueled by massive amounts of consumer data. As of December 2016, Facebook had around 1.23 billion daily active users, while Google processed around 3.5 billion daily searches. No one else comes even remotely close to generating that much information.
Unlike the many vendors in the AIC — forced either to buy data from others or extract it from the bid stream (where accuracy is dubious) — Facebook and Google collect data directly from consumers at massive scale, with consent.
The walled gardens may deliver unmatched marketing efficacy and attribution through single, unified platforms, but they do it in a manner that is far from heroic. Advertisers need the performance and scale but are increasingly frustrated about the lack of transparency. Advertisers’ data goes in, but doesn’t come out.
In theory, publishers should replicate Facebook’s data collection and execution, but lack the necessary technology and critical mass of users to do so effectively. So in order to better monetize their content, publishers are forced to work with these “frenemies” competing for the same ad budgets. And Facebook and Google are winning.
Whenever there’s a bully on the playground, those bullied can run and hide or band together and fight. In this case, a number of publishers have attempted the latter. If publishers can just add more scaled data to the mix, they’d be able to offer advertisers the same capabilities as the walled gardens. The problem is that these partnerships simply aren’t enough. Publisher revenues continue to stagnate.
The walled gardens’ ability to grow powerful first-party, privacy-compliant data sets that are integrated with sophisticated advertising technologies should be the solution to the advertising industrial complex. The problem with the walled-garden approach is the wall. Instead, imagine an open solution allowing advertisers full transparency into campaigns as well as rich, accurate consumer insights.
That solution would scale. Google and Facebook together only command about 25% of total consumer time. That leaves 75% of consumer attention spread across independent publishers that would be accessible programmatically. Instead of relying on one source of data, that solution would bring together diverse sets of consumer-consented data from a variety of premium publishers.
Finally, that solution would allow advertisers to run effective, attributable marketing campaigns via a single platform. In turn, publishers could monetize their content without forking money over to a duopoly that’s competing for the same dollars. In short, this solution would fuel true people-based marketing at a scale competitive to Google and Facebook.
It wouldn’t be a walled garden. It would be a connected garden.