MAdtech Point: Data Clean Rooms are the new age media agency

Data Clean Rooms helps the media agency to responsibly use the consumer data. While there are many use cases for clean rooms, it is the media agency that requires this technology the most, writes Gowthaman Ragothaman.

By
  • Gowthaman Ragothaman,
| January 8, 2024 , 8:44 am
With curation, publishers will be able to collaborate with data providers, brands, and retailers in a privacy compliant manner to build PMPs, package their first-party data with inventory from third-party publishers to sell to buyers. (Representative Image: PAN XIAOZHEN via Unsplash)
With curation, publishers will be able to collaborate with data providers, brands, and retailers in a privacy compliant manner to build PMPs, package their first-party data with inventory from third-party publishers to sell to buyers. (Representative Image: PAN XIAOZHEN via Unsplash)

When I started my career, as a media executive way back in 1990, there were quite a “ways of media planning” as doctrines that I came across. Amongst all, the one that stuck in my head is as follows: Media Planning is all about finding the right people, at the right place at the right time, often enough, under suitable environment to create the right response. Lots have changed in the media environment, but these principles have not changed at all. With one difference though. When these principles were written, there was an implicit understanding that we will be finding the right people with consent and not incessantly track them without their knowledge! Now after nearly 30 years, we are forced to have that called out as “responsible use of consumer data”.

Data Clean Rooms does exactly that. It helps the media agency to responsibly use the consumer data. While there are many use cases for clean rooms, it is the media agency that requires this technology the most. In fact, in the post cookie world, a media agency without a data clean room, will just not be able to perform their roles responsibly. Let us look at all the five pillars of media planning and bring a data clean room to life!

Finding the Right People:

In the analog world, finding the right people was easy, but broad and less accurate. Media planners lived with that. Panels and Surveys offered broad demographic cohorts under which audiences were segmented. Consumers did not have many choices either, so their behaviors could broadly be classified under these demographic cohorts. We didn’t miss the target. In the digital world, a http code was attached to the consumer’s behavior and that started offering better resolution to the choices consumers can make and that led to supposedly better targeting. We still didn’t deliver better targeting, apart from a few cases where that http code could be transmitted accurately. Today, this http code cannot be randomly attached to a consumer without his/her consent. We will need a data clean room to filter this consent and transmit it. Without a data clean room, finding the right people is not possible. Do watch out for “seller defined audiences” becoming popular, though.

At the right place:

For a good long time, right place, largely meant, towns or cities. Market planning was at a township level at the best. Brand sales were indexed with category sales to help prioritise markets (remember BDI/CDI!) and that is it. In the digital world, that http code, we attached to the consumer’s behavior offered us even deeper zooming in to the places. We could track the consumer as to whether he/she is in a theatre or a shopping mall. Under the premise of offering consumers better recommendations, we could collect these details.

The industry got carried away with knowing the consumers movements and occasions but forgot to follow it up with how this can help priorities markets/locations. Today, this http code cannot be attached without consent, and commerce platforms are jealously guarding this information for their own benefit in the form retail media network. They are not going to offer it free. We will need a data clean room to responsibly purchase this information for insights. Without a data clean room, finding the right place for occasions and locations will not be possible.

At the right time:

Campaign scheduling was largely limited to weekly planning. For a good long time, “an eight-quarter media investment plan” will be followed with an annual media calendar and that will have a deeper quarterly media plan. For further details, this media plan was further resolved to have day of week, weekdays, weekends, and prime time slots to make choices on media vehicles. Prime Time was the closed sharpness we got to finding the right time until the arrival of the http code. This code helped track the consumer round the clock, at an individual level. And so, we started to split the communication to time of day, day of week, week of the month and further across occasions and locations; and we could offer customization in the communication as well. All without consent. Today, this http code needs specific consent from the consumer at an individual level to be able to address him/her. We will need a data clean room to responsibly purchase this information for activation. Without a data clean room, finding the right time is not going to be possible.

Often Enough:

Whether it is Byron Sharp philosophy or any other customized insights, common sense, tells us that consumers hate to be chased too often. At a basic level, three times is enough. There is an old saying, “Tell them that you are going to talk to them, talk to them and Tell them that you have talked to them”. Three times is enough. Frequency capping is one of the hardest part of media planning. Every dollar that is spent beyond three times is a waste. Estimating the diminishing returns on media investment is the biggest thrill, I had in this job. Today, as the http code deprecates and walled gardens turning to become concrete jungles, frequency capping will be the biggest victim. It is simply not possible to cap frequencies across different concrete jungles; not to ignore the hard truth that it is not possible even within the platform itself. Significant dollars are being wasted beyond the diminishing returns in terms of advertising effectiveness. We will need a data clean room to build virtual identities across platforms to deduplicate. Without a data clean room, frequency capping is not possible.

Under suitable environment:

In the analog world, picking the suitable environment was the easiest job, so much so that this was almost taken for granted. Media planners along with the brand managers could chose the vehicles by name, page, and slot, so there was some quality control. An often-ignored responsibility, perhaps this behavior continued into digital advertising as well, but now paying the heaviest price when it comes to inappropriate adjacency of placing advertisements. Every single platform has been found guilty of ignoring this responsibility and paid the heaviest of the fines not to ignore the loss on brand reputation. Rampant use of made for advertising destinations that simply count the impressions goes totally unnoticed in the long list of “things to do” in a media plan. Despite initiating both “blacklists” and “whitelist” finding the suitable environment for placing advertisements at scale and speed is something that should not be compromised. We will need a data clean room that can match brand signals with that of publishers at a deterministic level to be able to offer quality inventory. Without a data clean room, placing ads under suitable environment cannot be 100% accurate.

To create the right response:

For good long period of time, effectiveness of a media plan was largely restricted to outputs only. If the TV/radio spots were carried, the print ads were published or the hoardings are put up, the job ended right there. Slowly we graduated to outcomes that are measured in the form of awareness, what we now popularly call as “top of the funnel”. Digital advertising came with huge opportunities to close the loop from awareness to action. Popularly positioned as performance marketing, when clicks or sales were guaranteed, it was seen as a huge leap from measuring just awareness. It is appropriate to note that while we measured awareness across all platforms, we measured clicks and sales, popularly called as “lower funnel”, individually for a platform. Despite being data rich with all possible and potential insights that can be sliced and diced, we are still not able to attribute right outcomes for the right actions. We will need a data clean room to be able to connect all the platforms in a trusted manner to be able to attribute outcomes. Without a data clean room, measuring the right response is not possible.

There is a huge opportunity for data clean rooms to play center stage in a media agency. And if I stretch this argument further, technically speaking, data clean rooms have all the capabilities to perform the role of a media agency. Digital transformation caught the media agencies off guard this last decade, under whose watchful eyes, emerged more than 50+ point solutions creating a luma scape of technologies. Responsible use of consumer data is a fantastic pivot, media agencies can rally themselves, to drive accountability on all the above 6 pillars of media planning.

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