First-Party Data Will Be Increasingly Valuable to Marketers. Publishers Must Step Up.

It’s been a busy fall. We held two FUSE summits in the past two months – FUSE Media and FUSE Digital Marketing, which focused on digital technology adoption strategies for publishers and brands respectively. Hosting these two executive summits provides a unique view of each side of the digital marketing ecosystem. There are some ground shifts underway affecting how marketers will buy advertising and work with customer data that publishers need to be aware of and should be able to play to their advantage. Namely, a combination of customer data privacy scandals (Cambridge Analytica) and legislation (GDPR, California Consumer Privacy Act) have placed a new urgency to existing efforts to use content marketing to attract audiences, grow first-party data, and act on that data. Below is a rundown of the opportunity and why publishers need to respond with greater urgency. The Opportunity: The Data Crackdown When it comes to digital media, marketing, and technology, there is one unifying factor, and that is unsurprisingly, data. It’s on the minds of everyone. How to get it, how to manage it in a functional way, and how to act upon it. And while data has been a big deal for quite a while, some big changes in the last 12-18 months are shifting the dynamics of the data economy and marketers are making some big adjustments accordingly. A quick refresher: The ongoing scandals and upheaval coming out of Facebook will have implications for years to come. Data privacy has been thrust into the mainstream conversation, never to return to the dark shadows of the digital advertising world. In an Adweek article titled “The Battle Between Data and Privacy Rights Will Become Even More Chilling,” Josh Sternberg says that data privacy has now become top-of-mind for people outside the digital advertising world, which will only increase as technology innovation and invasiveness progresses. Referring to three in-home devices from Facebook, Google, and Amazon with clear privacy implications, Sternberg writes: “All three of these products present ethical quandaries for users. How much of our privacy do we give up in order to turn on the lights by asking an assistant? Should our data be ours, or is it part of the unsigned contract we make with tech companies to use their free services. Next year will only intensify the chasm between the tech companies and legal entities that want to regulate them.” And while the public is not shutting down their Facebook accounts in droves, there’s been a clear inflection point here. This consumer awareness of customer data will alter the value exchange of customer data. There are already platforms emerging to help consumers better control their data. For example, Dock (dock.io) promises to give “internet users ownership and control of their data” using blockchain technology. I’m just waiting for platforms/exchanges that allows consumers to monetize their data in real-time programmatic auctions. Meanwhile, brands are coming to realize more and more that there are hazards of using customer data without direct consent, ranging from consumer backlash to actual legislation and penalties. The Facebook Fake News scandal, as well as issues of brand safety have also played an integral role in exposing the nefarious economics of the digital advertising ecosystem. Digital advertising exchanges effectively made it possible for advertising function entirely independent of the content next to it – until it became public knowledge that they were funding terrorist videos and other bad things. This too has been brought out into the light and many brands have reigned in the breadth of sites they place ads for this reason. Trusted Media Brands, for one, has made brand safety a big part of their sales pitch. The social platforms and digital Goliaths will continue to have to react to changing perceptions of data privacy. Facebook has already made big changes to its third-party data policy. Back in March Facebook shut down Partner Categories, the advertiser tool that allowed third-party data brokers (like Acxiom and Experian) to sell targeting data on consumer purchasing topics. This is a big deal. (See "Facebook Data Changes Create Sales Opportunities for Publishers.") Salespeople need to be aware and well-versed in everything that’s going on in this space. You can be sure there will be more scandals like Cambridge Analytica to come, involving other technology companies, and more consumer-focused regulations resulting. (Did you know Vermont passed the country’s first law regulating data brokers earlier this year?) One day we’ll look back at the Cambridge Analytica Scandal and the moment before GDPR became effective as the peak of laissez-faire customer data policy. What does this all mean? That marketers will shift toward consent-based marketing, looking for ways to acquire first-party data and work with partners that have clear relationships with and committed data from consumers, like publishers. As Northstar Travel CDO Matt Yorke said in his FUSE Media Summit keynote, B2B media should focus on their unique ability to leverage their rich behavioral data and marry it with the scale and reach of social platforms to deliver highly-qualified leads and demonstrate results in order to win marketers’ dollars. And now is the time to strike. The same holds true for consumer publishers. Hearst is making huge strides in connecting its content, behavioral data, commerce on behalf of brands to provide more value and earn higher CPMs. This is not at all to suggest that everything is rosy for publishers. Facebook and Google are expected to net 57% of digital advertising spend this year (and are responsible for nearly 75% of digital ad growth), and Amazon is making ground. But publishers should aggressively move to capitalize on this opportune moment, explicitly marketing value-versus-scale, and set their organizations up to succeed as such. The Challenge: Technology, Skills and Culture Of course, publishers are already working with brands to grow their first-party data set. But we should expect this demand to grow, especially on the consumer marketing side. Publishers also need to move further to the coveted 360-view of individual audience members across platforms. Publishers have made strides in these areas, but most publishers are not as advanced when it comes to audience data management as they often claim publicly. Even if they have the data infrastructure in place on paper, publishers need to be able to work with customer data in a timely, flexible way and communicate with clients to sell, implement, and report on digital marketing campaigns. Like, really be able to do it. Running complex digital marketing campaigns on behalf of clients is time- and resource-intensive. Publishers shouldn’t underestimate the time it takes to sell and support these products, especially if the right technology and culture is not in place. Recall that a lot of early-day native advertising campaigns exceeded forecasted budgets and timelines, and poor client experience and expectation-setting meant renewals were low (that’s finally changing). The hope is that a slew of digital technologies will essentially enable publishers to reassemble their audiences that have been so fragmented since the emergence of the web (and mobile, apps, social, etc.) into audience segments that can be nurtured from an editorial perspective and packaged for the needs of advertisers. Customer data platforms (CDPs) have become a big focus in the industry in the past three years as a promising tool for connecting all the pieces of customer data in a way that non-data/technical media people can use. But even the CDP is not a cure-all. During at panel on CDPs at the FUSE Media Summit, the panelists expressed the biggest obstacle to earning ROI on CDPs was clearly people and process. In many cases, publishers don’t have the right skillsets and should seek to hire true digital marketers, perhaps poaching talent from digital agencies. Likewise, workflows need to be overhauled to perform agency-like duties. As an aside, another reason why this is an opportune time for publishers to buddy up with marketers is that an increasing number of brands are bringing their programmatic buying in-house instead of relying on agencies. This presents a big opportunity for publishers to work more directly with brands once they have the know-how to execute direct programmatic buys and for publishers to make the case directly the benefits of engaging with high-quality, known users. Publishers will also continue to face challenges in selling data-driven programs if their sales people are not equipped to consultatively sell based on first-party data and content marketing objectives. An understanding of how digital marketing campaigns function and a competency with speaking about data is a must and management must support this. Samuel Monnie, director of digital transformation at Campbell Soup Company, who spoke at the FUSE Digital Marketing Summit, made an important distinction between “training” and “capability building” when it comes to technology adoption by an organization. Training is the one-hour session you require staff to participate in for a new email or analytics platform. But capability is a process of embedding a technology in workflows and culture, measuring, and improving over time. To fit the data needs of marketers, publishers should ask themselves: How are technology and data built into our workflows? What role do they play in meetings, conversations, and performance reviews? Become the Data Pipeline in A Time of Need The good news is that publishers by-and-large are well ahead of brands when it comes to data procurement and management. Many brands lack the mechanisms for producing content that will attract customers and yield first-party data, and then tracking customer engagement and extracting data insights that can be acted upon in a meaningful way. And their tech stacks are even more fragmented than publishers and face even bigger organizational hurdles than publishers when it comes to unifying technology objectives, buying, strategy, and implementation. To be sure, though, brands are working to solve these problems from a technological and organizational standpoint. It's currently their top priority. So publishers have a window of opportunity to solve brands’ content and data needs and embed themselves as a first-party data pipeline. This need among marketers will diminish over time as they stand up customer data-centric marketing stacks. Now is the time hook up your pipeline.

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First-Party Data Will Be Increasingly Valuable to Marketers. Publishers Must Step Up.

Denis Wilson

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