The first party data race is on: Can Australia's TV networks and publishers catch the duopoly?
The recent upfront season made it abundantly clear that publishers fully focused on first party data over third party data.
As stricter data privacy and tech regulations evolve, targeting prospects across the digital landscape has become harder.
As a result, marketers are searching for solutions that use fewer third party cookies or identifiers to target users across different browsers and devices. In effect, re-architecting each and every digital touchpoint to work as efficiently at targeting, without using the cookie-based technology that an entire industry has been built around.
To do this, they are looking into identity-based media buying strategies, as well as contextually relevant environments across various tech solutions from publishers and vendors to help them with the transformation.
If publishers can combine first party data and programmatic buying with connected TV, digital out of home and more, they may yet tuck into the digital duopoly's lunch.
Until very recently, it was the role of a data management platform (DMP) to simply collect data for a publisher as a third party targeting solution.
This data would then be enriched using other data sources, and then, by exposing that enriched third party cookie in real-time for auction, it became easy for buyers/agencies to acquire in real-time as an audience.
This was, however, always a passive activity on the consumer side. It just 'happened' and they were unaware.
Now, with the need to identify users at a first party cookie level (covered below), readers need to login / authenticate for the same type of targeting capabilities and, they also need to see some form of value in exchange for that data - because they are being explicitly asked to give permission for that data to be used for marketing purposes.
This becomes a problem when 30-40% of your traffic relies on a viral or content distribution strategy via Facebook or Google, and users are not logged in when they arrive at your site. They become 'unknown', and a much lesser value can be attributed to them.
Given that there was no real need for publishers to create a login data collection solution, it wasn't and hasn't been the main focus for many publishers.
Now, however, having that direct relationship with the consumer is more important than receiving traffic from third party platforms such as Facebook/Google. Publishers recognise the need to grow their ownership and relationship with users as a content destination rather than rely on 'renting' traffic from other sources, therefore, creating a better revenue strategy around addressable media and content.
By doing so, can they reliably offer media buyers a replacement to the giants of data-mining and segmentation: "the walled gardens"?
In last month's ACCC report, you may have read that of every $100 of Australian Digital Marketing Spend in 2019: $53 went to Google, $28 to Facebook and, only $19 to all other websites and ad tech.
You can see the urgency to pivot.
Suppose publishers make it easier for buyers to plan and buy efficiently through programmatic methodology, using publisher-owned first party data. In that case, it is easier to reallocate from walled gardens while also extending out across Connected TV, Out of Home, and more.
This shift is sorely needed in Australia, and we should help and encourage it.
The road to here:
The first most visible publisher removing their reliance on third party data (and cookies) was The New York Times.
Third party data (3PD) is collected from consumers as they visit niche locations across the internet (generally by cookies) that shows their intent or collects demographic data, etc.; it is attached to a device for targeting when that user is located across the open web via adtech stacks.
3PD, however, is being phased out from the ad ecosystem. It is not considered privacy-friendly due to a lack of opt-in permission and other such opaque rules hidden in terms/conditions.
It is still available to acquire and enrich targeting within regions where regulation has not forced the issue - yet. In the meantime, The New York Times and countless others still use it.
Tech and regulatory changes
Using third party data across the open web (anything that is not a walled garden or behind a paywall) has never been bullet-proof. However, programmatic solutions have delivered reliable revenue for publishers and made it easy for buyers to scale audiences.
With the deprecation of targeting options firstly via Safari Cookies and then via Google Chrome and seemingly ID For Advertisers (IDFA) within iPhone apps - publisher needs have also changed. They are losing these effective means of targeting. Losing targeting means losing the scale of inventory, which means losing revenue.
The move to first party data - and the authenticated web
Instead of using third party data attached to a media buy, first party signals (1PD) from a publisher can be passed into a media placement bid stream as it loads up. The Sell-Side Platform or Demand-Side Platform used, have the ability to pick up that publisher's ID, matched to 1PD, and deliver a targeted placement.
The data's volume and scale, however, depend on each publisher. The maturity of that publishers' data lake also determines the ability to activate it across an agency or advertisers' own needs
For the larger publishers, building on top of their first party data is possible by encouraging repeat visits. Offering fresh, unique content that creates a fair value-exchange for users in return for agreeing to log in and share data is vital. Why generate and produce a TV show to share with other networks if you can gain valuable first party data by streaming it as exclusive and enriching the offer to advertisers?
For smaller niche websites which are visited less frequently it is harder to scale or retain revenue through first party data. This is where contextual targeting tools and niche publishing networks will rise.
Conversely, it is hard for larger publishers to gain access to this type of intent data, given so many niche audiences are elsewhere across the open-web, and previously, they could purchase this data as third party. New ways of acquiring and distributing data in a compliant fashion have, therefore, become available.
Mi3 Special Report: Australia's looming $1bn retailer media market
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- US retailers are already displacing 'legacy' publishers.
- All retailers are eyeing media, not just supermarkets and FMCG.
- Mi3 supported by Resolution Digital have produced a 28-page report with cross-industry views on what you need to know.
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As much of Australia looks forward to emerging from long lockdowns in the coming weeks, there is huge pent-up demand for retail therapy. Scentre Group, which operates 42 Westfield shopping centres across ANZ, has polled thousands of customers on their Christmas plans. The results should give brands and retailers some pre-festive cheer.