Data clean rooms (DCRs) are a priority area for many marketers, but raise tough questions for the industry as adoption spreads, a report from the Interactive Advertising Bureau (IAB) found. 

Steep investments are required to maintain DCRs, both in terms of building the underlying tech and the talent needed to manage it. That puts smaller brands, agencies and publishers at a “tremendous market disadvantage,” per the IAB — one that may curtail in-housing trends. The IAB also views DCRs as needing data interoperability to reach their full potential, an area where marketers have historically struggled. Among surveyed DCR users, 39% pointed to challenges with data interoperability and customization, while 38% called out a lack of internal resources and 32% did so for privacy hurdles. 

DCRs have become a fixation point for marketers as they try to address the pending deprecation of third-party cookies. The technology allows advertisers and platforms to dump their aggregated first-party data into one place in a privacy-safe fashion. Different data pools can then be matched up to refine targeting and address problems like audience duplication, among other functions.

Platforms and publishers have quickly wised up to the business potential. Amazon has expanded clean room capabilities powered by its AWS cloud-based computing juggernaut. Disney Advertising also enhanced its existing DCR through a VideoAmp integration. 

Broadly speaking, companies are expected to invest 29% more in DCRs in 2023 compared to 2022, according to the IAB. The research conducted by Ipsos draws on 200 surveys and 20 in-depth interviews with stakeholders from across different industry categories. 

“There is growing demand due to loss of signals, and wanting to share data with partners without sharing sensitive data,” said Jeffrey Bustos, vice president of measurement, addressability and data at the IAB, in a statement. “This may show that companies are understanding what’s required and ramping up their investments accordingly.”

But the trade group’s report also emphasizes that the resource intensiveness of DCRs could leave smaller and mid-size marketing players behind at a critical juncture. 

DCRs are often leveraged in tandem with other ad tech like customer data platforms, data management platforms and consent management platforms. The compounded annual costs of these stacks can climb above $2 million, per the IAB.

Nearly one-quarter (23%) of marketers spent over $500,000 on their DCRs alone in 2022, while 62% put a minimum of $200,000 toward the technology. The heavy price tag could be more of a drag in a downturn, when marketing departments are often among the first to feel cutbacks. 

Time is another consideration, with respondents stating that standing up a DCR offering can take up to two years. Meanwhile, Google has slotted cookie deprecation to take effect in 2024. On the talent front, roughly half of DCR users have teams of six or more people dedicated to the tech and 30% have a minimum of 11 specialists.

Looking beyond the barriers to entry, the IAB believes DCRs could be held back without full data interoperability. That’s a level of standardization and unification that’s been called for in digital marketing and ad tech for years, while the landscape in reality has often remained fragmented and controlled by walled gardens.

“It’s in everyone’s interests for closed ecosystems to provide access so that advertisers can effectively analyze their campaign activity,” said Bustos. “Advertisers need a window into the data.”

Heineken applied attention-based measurement for the first time in a globally tested campaign and achieved better-than-expected results, per details shared with Marketing Dive.  

The beer brand’s Rock in Rio 2022 sponsorship was deployed with agency Dentsu and programmatic ad-tech platform Teads, which used Lumen´s Research LAMP program and a metric called APM to track success. The technology is based on a predictive attention methodology that’s based on knowledge of consumer behavior in digital environments. Heineken’s APM was five times higher than Lumen’s digital benchmarks while its view rate was two times higher. The marketer also received the highest level of brand recall among Rock in Rio sponsors, according to a news release. 

Discussing the Rock in Rio results, Heineken representatives said the brand prioritized an attention-based approach to see a “more qualified vision of impact.” 

“In an environment where people dedicate less than 10 minutes of their attention each day to advertising, we need to find other ways to evaluate engagement,” said Fernanda Saboya, director of consumer connections at Heineken Brazil, in a statement. “By surpassing expectations, results show we are on the right path to creating more assertive campaigns that capture attention in a much more effective way.”

The effort utilized “disruptive” display formats and social placements highlighting giveaway promotions before and during the event and used data to target three sets of festival goers: Gen Zers, alternative music fans and vintage enthusiasts.

The APM metric, or average attention per 1,000 impressions measured in seconds, is part of the emerging attention-based methodologies that solutions providers like Teads are championing. The attention economy has become a marketing buzzword as holding people’s interest for even a few seconds proves challenging in a busy digital world. Attention-based forms of measurement have subsequently gained industry traction as brands try to assess not just whether a person saw an ad, but also if they engaged with the media on a deeper level. For example, someone served a spot on YouTube or connected TV might check their phone until the video ends, meaning the marketer reached a degree of viewability without actually producing a high-value interaction. 

Agency partner Dentsu has also attempted to push past a square focus on viewability, believing the metric alone is insufficient for gauging effectiveness based on complex factors like an ad’s format size, length and page position. 

The search for richer forms of digital measurement comes as mainstay tactics experience disruption. Third-party cookies, one of the most popular ways of keeping tabs on consumers online, are set to be phased out in 2024. Mobile platforms like iOS are also implementing privacy changes that make targeting and measuring campaigns more difficult.   

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By ARM Treasure Data

Leveraging the power of machine learning and the increasing availability of data, companies increasingly use predictive analytics to identify customers’ intent, design experiences tailored to individual preferences, inform product development decisions, and improve business operations.

Predictive Analytics Use Cases

Marketers must constantly find new ways to engage customers so it’s no wonder that predictive analytics are most commonly used to predict customer behavior. However, other functions such as supply chain, operations, product, and service can also leverage predictive techniques to improve business results. Here are six use cases where data insights can quickly make a difference.

1. Identify Customers Likely to Churn
   Predictive retention models can identify which customers are most likely to churn — companies can reach out to them with education on products or tailored promotions. Predictive models can also identify common behaviors of loyal customers. With that knowledge, companies can attempt to steer likely churners to adopt those desirable behaviors. 

2. Recommendations for Cross-sell and Upsell
   When selling a variety of products, predictive modeling can help improve the “recommended for you” engine by analyzing historical data and applying customer profiles to target optimal conversion. For example, someone who has purchased hiking boots might be shown other outdoor gears. 

3. Prediction of Features for Product Development
   Predictive analytics can help determine which features to include in upcoming releases. A recommendation engine can be used to score features with various attributes. Information such as what competitors are doing can also be incorporated. 

4. Inventory Forecasting and Pricing Strategy
   Businesses can use predictive analytics to get insights from combinations of data, such as inventory across a large number of SKUs, categories, and locations overlaid with geographic sales data. This can identify buying patterns to inform pricing, promotional strategy, and optimal inventory levels. 

5. Calculation of Risk
   Predictive analytics is also useful for the banking and insurance industries: to calculate risk. Predictive scoring models can evaluate prospect lists and provide an indication of the relative risk of a potential customer. The predictive model could examine hundreds of risk indicators, narrowing characteristics down to small details, and predict expected losses.

6. Predictive Maintenance and Quality Fulfillment with IoT Monitoring
   If you are responsible for customer support or hardware maintenance and repair — perhaps monitoring through IoT devices — knowing which components are most likely to fail would allow you to be proactive rather than reactive, thus avoiding unscheduled downtime. Replacement or maintenance of parts can be planned based on real-time data rather than schedules. 

Benefits of Predictive Analytics

Predictive scoring gives marketing teams the ability to allocate budgets wisely — focusing on getting the right message to the right people at the right time — and improve campaigns ROI. An analytics system makes it easier to identify customers with shared traits and finding look-alike customers from your install base. Once the customer segments have been identified, marketers can create custom messages and campaigns targeted to those segments, creating special offers designed just for them and activating on the channels they prefer.

Making Predictive Analytics Accessible

Arm Treasure Data’s Customer Data Platform (CDP) is purpose-built for marketers — developed with both data availability and accessibility in mind, designed to bring marketing and data teams together. The technology behind the Treasure Data CDP is a scalable, enterprise-grade big data platform. It combines pipelines of clean, unified customer data with a robust and reliable open source machine learning library.

This puts powerful machine learning tools into more hands, allowing more people to gain greater understanding of their customers, and building business practices around the customer.

As the industry prepares for the depreciation of third-party cookies in 2024, data mastery will only become of increased importance. Yet, despite an increased emphasis on the importance of data in marketing, only 53% of marketing decisions are influenced by data, according to a survey by Gartner.

The consulting firm predicts that 60% of CMOs will cut the size of their analytic departments in half due to “failed promised improvements.” Inconsistency and difficulty of access were listed among the top reasons analytics were not used when making decisions. The survey, which was conducted during the summer of 2022 and polled 377 users of marketing analytics, reflects the ongoing challenges marketers face as they attempt to integrate data into decision-making efficiently.

As Google begins to phase out third-party cookies, marketers have been making increased attempts to gather and leverage their own data in preparation. Media networks of all stripes have made bold promises to marketers on their data and targeting capabilities. Analytics teams and software have become mainstays in marketing departments. However, the Gartner study questions whether those investments are paying off.

No matter how involved analytics are in decisions, marketing departments don’t always see the returns. Organizations are more likely to agree they are unable to prove marketing's value if analytics were used in fewer than 50% of decisions. On the flipside, if analytics influenced more than 50% of decisions, there are likely diminishing returns for the organization, according to Gartner’s findings.

“CMOs often believe that achieving marketing data integration goals will lead to greater influence and increased value of marketing analytics,” said Joseph Enever, senior director analyst of the Gartner Marketing practice. “The reality is that better data won’t increase marketing analytics’ decision influence alone. CMOs must address the real challenges — cognitive biases and the need for a data-informed culture.”

The survey found that one-third of respondents said decision-makers cherry-pick data that supports a decision or opinion they’ve already formed. Cognitive biases were cited as a major barrier to marketing analytics influence.

Additionally, when information was provided, it wasn’t always used. Twenty-six percent of respondents said decision-makers did not review the data provided to them, 24% said decision-makers rejected their recommendations and 24% said decision-makers went with their “gut feeling” to make a choice.

According to the report, if CMOs want analytics to be successful they have to take a few things into account. First, they should track decisions that are made with analytics to pinpoint areas of improvement. Then, they should avoid cherry-picking. Leading by example and establishing analytics upskilling programs were also recommended.

NEW YORK – Emerging technologies such as AI and virtual try-ons have enhanced the consumer experience in the post-COVID landscape, said Ophelia Ceradini, vice president of digital technology and innovation at The Estée Lauder Companies.

Ceradini, whose comments were made during a panel at National Retail Foundation’s (NRF) Big Show, pointed to the quickly changing relationship between brands and consumers. Despite returning to stores, consumers do not want a separate online and offline identity, per the exec. Instead, the beauty consumer’s online identity should follow her when she reaches the store and vice versa. 

“It’s all about using the data you have...making her feel like one person,” said Ceradini.

Ceradini was joined by Nicolette Bosco, vice president, divisional business manager for beauty at Macy’s and Kelly Kovack, the founder and CEO of BeautyMatter. Kovack served as the moderator of the panel, titled Beauty’s blush with technology. The trio discussed how technology is changing the industry, including the impact of AI and the difficulty of keeping up with trends. 

AI is for everyone

Despite increases in both online and brick-and-mortar sales, the rate of merchandise return has remained steady or dropped, indicating a more satisfied consumer. Technology is one potential reason behind the shift. Software enabling virtual try-ons leaves consumers guessing less about what they want. This means that the consumer is usually more informed and has a better idea about what they are purchasing. 

However, technology carries its own assortment of issues that marketers must deal with. For example, the human population is incredibly diverse, and catering to all body types and ethnicities has proven elusive. Making sure all customers are seen is incredibly important, especially for beauty brands, per the panelists. For example, Estée Lauder has made an effort to cater to every type of eye shape with its virtual try-on technology.

There’s a virtuous circle for brands when they can use technology to provide value for consumers, who are more comfortable sharing data with the company if they are able to get something out of it, according to Ceradini. Such data can help marketers further optimize their messaging and activations. 

A more individualized experience has also been beneficial on the retail side, according to Bosco. For example, Macy’s has introduced an auto-replenishment system which allows consumers to set how often they want a product sent to them.  

“Once you've found something that you absolutely love, you can go on and set it and almost forget it,” said Bosco.

Power to the beauty experts

Both on the retail and brand side, there has been an effort to empower beauty advisors, according to panelists. By granting consumer-facing employees the ability to keep up with trends, they are able to help consumers find what they are looking for even if the brand itself has not had time to pivot toward what the latest TikTok trend is. 

That doesn’t mean the brand itself shouldn’t be on top of trends, according to Ceradini. It’s important that brands try to predict what they can and pivot their advertising when necessary. On the retail side, it’s important to make the most of the inventory in stock, according to Bosco.

However, allowing floor beauty advisors to be on devices and to look up the latest trends gives them the power to meet the consumer where they are. From there, the imperative becomes letting consumers know where the latest trendy product can be found. 

“But then really pivoting the market to tell consumers, ‘Hey, we have it here,’” said Bosco.

Nearly 61% of hotel brands have implemented a first-party data strategy, and of them, 81% reported an increase in revenue after implementing the strategy, according to findings by travel marketing company Sojern.

First-party data strategies have become increasingly valuable as marketers prepare for the looming end to third-party cookies. With their widely used loyalty programs, credit-card partnerships and other data-gathering initiatives, hotel brands are sitting on a wealth of first-party data that can be used to better cater to target consumers. 

Sojern’s study, which surveyed 74 executives representing a cross-section of hotel companies in North America, Europe and Asia Pacific, indicates how hotels are already seeing results from leveraging their first-party data. Among other benefits, the majority of respondents saw an increase in campaign performance, increased brand value and stronger customer relationships. Two-thirds of respondents expect to see more benefits in 2023.

Additionally, 57% of respondents indicated they saw an increase in guest satisfaction at their properties, 76% reported that they saw an increased campaign performance, 68% reported stronger customer relationships and 64% said brand value increased. 

The survey also indicated that 59% of hoteliers have already implemented a first-party data strategy, 62% of whom said the strategy was “very important” for digital marketing. Of those who had not yet built a first-party data strategy, 75% said they want to build one. Eight-six percent view a first-party data strategy as being useful in maximizing overall revenue. 

While first-party data is clearly important for hotels’ marketing efforts, it could also prove valuable should any more hotel chains opt to create their own media networks. Already a growing channel for retailers, proprietary media networks offer companies an opportunity to use their owned media channels — like in-room television and digital screens in hotels — to host paid advertising from other brands. 

Marriott International launched the Marriott Media Network earlier in 2022, the first such network for the hospitality industry. The media network will initially target travelers in the U.S. and Canada, but Marriott said it would expand the platform globally giving advertising access to the 164 million members of its Bonvoy loyalty program. 

“It’s no surprise that three-quarters of hotel executives want to build a first-party data strategy,” said Kurt Weinsheimer, chief solutions officer at Sojern, in a release. “With a cookieless world coming, it will disrupt the entire industry, and marketers must use this time wisely to prepare.”

Meta is rolling out a new machine-learning solution for reducing algorithmic bias in its advertising in 2023, according to a blog post. The Variance Reduction System (VRS) was developed over the past year with the Department of Justice (DOJ) as part of a settlement agreement over alleged discriminatory practices in the way Meta’s housing ads were served. 

VRS, which is rolling out now in the U.S., carries implications beyond the housing category as well. Meta plans to implement the system for other areas of its sprawling ads business that are affected by federal discrimination laws, including employment and credit ads, later this year. The DOJ is positioning the new resolution as not just a power check on Meta, specifically, but also a wake-up call for other platforms that rely on algorithms to deliver digital advertising at scale. 

“This development marks a pivotal step in the Justice Department’s efforts to hold Meta accountable for unlawful algorithmic bias and discriminatory ad delivery on its platforms,” said Kristen Clarke, assistant attorney general of the DOJ’s Civil Rights Division, in a press statement. “Federal monitoring of Meta should send a strong signal to other tech companies that they too will be held accountable for failing to address algorithmic discrimination that runs afoul of our civil rights laws.”

VRS is the outcome of a lawsuit that saw Meta, formerly known as Facebook, come under fire for its housing ads. According to the case, the company applied algorithms that could serve ads based on characteristics federally protected under the Fair Housing Act (FHA), including sex and race and ethnicity, resulting in discrimination. 

The social networking giant in June settled with the DOJ, with VRS one of the more substantial ways it’s trying to remediate the situation and ensure its advertising is equitable. As part of the agreement, Meta is also sunsetting a Special Ad Audience tool that targeted ads at lookalike audiences and is removing targeting options for housing advertisers that describe or relate to FHA-protected characteristics. 

A third party selected by Meta and the DOJ, Guidehouse, will review the VRS to ensure compliance, with the courts having the ultimate authority to resolve any disputes that arise. The DOJ called the resolution “groundbreaking” and said it hoped other platforms would follow the social media firm’s lead in tackling algorithmic bias.  

The news shows Meta’s advertising coming under direct court oversight for the first time. It’s another sign that years of controversy surrounding data and ad-targeting practices are starting to catch up with the Facebook and Instagram owner. Meta was also recently fined roughly $275 million by Irish authorities over its approach to ads personalization.  

 

NEW YORK — Metaverse activations and game-like experiences continue to be on the rise in 2022 as marketers look to reach digitally driven consumers, but until such plays are seen as an experience versus an experiment, valuable success metrics will likely remain out of reach, according to Eric Pulier, CEO of Web3 enterprise class platform Vatom, who discussed metaverse marketing tactics during an Advertising Week panel. 

In recent years, brands have leveraged the metaverse in a variety of ways, whether it be a virtual storefront, collection of mini-games, augmented reality experience or as a pathway to nonfungible tokens (NFTs). The number of users visiting such activations and the time spent per session offers some insight to performance. However, a data gap lies in the inability to track success beyond walled gardens, begging the question of whether or not such channels are worth it.

“In the end, the data that you’re getting is similar to doing a very successful television commercial — it’s exposure,” said Pulier. “You’re not really building a relationship with that audience, you’re not getting the first party data, you’re not then following up and creating that ongoing experience that is really the essence of a communication strategy.” 

In its current stage, Pulier defines the progression of marketing in the metaverse as the “first inning,” and to move the needle, brands need to be adopting an always-on mindset that keeps the end-consumer in mind, he said during the panel titled “Marketing in the Metaverse,” which also featured panelists from Procter & Gamble and iHeartMedia. 

In one example, the exec pointed to PepsiCo’s Frito-Lays and its FIFA World Cup campaign. As part of the campaign, consumers who buy select Frito-Lay products can scan a QR code on a product bag to be prompted to take a selfie, which will then appear on a giant, digital soccer ball. The experience, perhaps the largest cumulative art project in history, Pulier said, offers an initial trade-off — data in exchange for an experience — but also holds the potential for FIFA fans to check back in to see new faces and a finished product.

“You have this notion of this experience that you’ve taken part of in a virtual plane that now results in an emotional experience and an ongoing dialogue with the brand that is positive — value is on both sides,” he continued.

Global stage

IHeartMedia has already begun making good on the concepts outlined by Pulier with the launch of its always-on iHeartLand in Fortnite. The space, which boasts a virtual concert arena sponsored by State Farm, has plans to host more events.

Building iHeartLand meant stepping back and unpacking what the team believed the metaverse was in order to move forward intentionally, said Rahul Sabnis, chief creative officer at iHeartMedia. A key priority throughout is ensuring digital spaces are easily accessible, opening the door without potentially complex add-ons, like cryptocurrency or blockchain technology, so that a wide range of consumers would feel compelled to play and brands, like State Farm, have the opportunity to tap into multiple audiences.

“It’s not just a one and done but creating an ongoing dialogue with our communities where they are,” Sabnis continued. The concept has proven successful so far — Charlie Puth headlined the first concert hosted at the virtual arena, and in one weekend, Puth had the audience equivalent to 50 performances at Madison Square Garden, per the executive. 

IHeartMedia also partnered with Vatom to create a platform built off a scannable QR code that takes existing live events and creates a blended reality opportunity intended to enhance experiences on site with exclusive opportunities and perks that wouldn’t be accessible otherwise.

“That’s the exchange of data that we feel is very transparent,” Sabnis said. “One of the things that we look for when having people come to our concerts is that they can take more control of their identity and have an ongoing relationship with events.”

The scannable QR code that makes up iHeart’s strategy is representative of the evolution from Web2 to Web3, Pulier said. In the past, fans scanning a QR code would likely be prompted to download a plethora of apps for exclusive benefits. Now, consumers from a single connection point can opt-in to individually, legally and ethically have a relationship with every brand partner that iHeart brings to the table. 

“Those ongoing relationships are how you measure success,” Pulier continued. “Did you get the data, did the experience create value for both sides, and do you have an opportunity to follow up? It’s marketing, advertising and loyalty all collapsed into one.” 

Changing behavior

Procter & Gamble is still nailing down their metaverse strategy, according to Kimberly Doebereiner, group vice president, Future of Advertising and head of P&G Studios, but it’s already found brand-exclusive ways to offer value to consumers. 

In one example, the exec pointed to a tie-up with Vatom and Tied to create a program as part of its “Turn to Cold with Tide” sustainability campaign that allowed consumers to log how many cold laundry washes they do for the chance to level up and earn prizes — 80% of consumers said they would enjoy doing it again, Doebereiner said. In a similar example, she referenced the P&G LifeLab, a virtual world that focused on sustainability education with highlighted brands like Charmin and its forestry efforts — the average session length in the world was 20 minutes.

“It’s not always on yet, but it is a way for us to create those in-depth people experiences that allow them to have information the way they want to receive it,” she said.

A promising value exchange could also be centered around accessibility. Doebereiner pointed to a Snapchat augmented-reality tool created by Pampers that allows a storybook to come to life for parents to have the opportunity to read to their children. The fact that 40,000 books have been read nods to the potential for consumers to not only come back to the experience, but even integrate it into their routines, she said.

“That’s an amazing way for Pampers to serve the parents who may or may not have access to books all the time,” she said. “To me that is moving us along, how do we create more immersive personalized experiences that the consumer is in control of that the brand is able to serve.