Which Telco Will Be The First To Challenge Facebook And Google?

"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Matt Keiser, founder and CEO at LiveIntent.

The telcos are uniquely equipped for the battle of the people-based marketing crown.

They have the best mobile data, which is crucial for building the identity graphs that power people-based marketing. Telcos also have offline, validated and billable people data. Platforms can tie a mobile ID or email hash to a cookie, device or anything else, but rarely can platforms tie them to a real person that’s been “offline verified.” Because of the billing relationship, Telcos have access to phone numbers, credit card numbers, addresses and the number of rooms in their customers’ houses.

Telcos, as I’ve argued before, stand at an advantage for dominating the people-based marketing era. Logins and log files are at the center of identity graphs, and telcos have access to logins, billing data and log files from their proprietary media at scale.

All that telcos need to create industry-leading cross-channel identity graphs is fill in the gaps by adding algorithms and business rules to these vast data sets as Telenor did when it bought Tapad. And they must add probabilistic data: Deterministic data is too sparse on its own.

Telcos Need Probabilistic Data

Verizon may know everything about my iPhone, but it only knows a bit about my iPad because I never use it to log in to Verizon. However, the iPad is active 300 days a year alongside my iPhone. I may have also logged into Gmail on a shared computer and opened an email Verizon sent.

That would give Verizon a deterministic match between my deterministic ID and the shared device. However, using deterministic data to target that shared device stops being accurate the moment I log off. Probabilistic techniques combined with deterministic data can create a more complete picture of consumers, but only for those that wield data at the execution layer.

In a world where everything is mobile, telcos could emerge victorious. However, the telcos still need varying amounts of expertise in technology, people-based marketing and identity.

That’s why AT&T’s hire of GroupM’s Brian Lesser is so important. He can help AT&T, a neophyte in people-based marketing, acquire the technology it needs to build out its capabilities. This puts it at the forefront of telcos making the plunge into people-based marketing alongside competitors Telenor, Verizon/Oath and Singtel. Lesser walks into a situation unencumbered by data privacy restrictions that plague Verizon (thanks a lot, Turn zombie fiasco) and buoyed by the reputation of one of America’s oldest companies.

Regions that went mobile first like Asia (Singtel/Yahoo Japan) and Europe (Telenor) learned that you need deterministic data at scale and probabilistic capabilities to tie enough devices together for true journey-based marketing, measurement and attribution. This will create a new term: probabilistic people-based.

The identity graph, at its core, is about mapping devices to intent data, login data and people, which is no small feat in a world of multiple devices, browsers and email accounts. Telenor bought Tapad because brands insist on personalized customer experiences that span browsers and devices. Journey people-based marketing requires combining vast deterministic reach with probabilistic capability to solve resolution across devices, channels and platforms.

Much of our time spent in digital is in the sandboxes of app, video players and email inboxes, where the cookie is only available in each environment, unavailable to third parties. The problem is ad tech is built on commercial cookies – third-party cookies available across websites. This is why wielding identity is important: It’s the connective tissue that binds together the customer journey.

The Horse Race

I predict AT&T, Singtel and Verizon will be the first US behemoths to embrace probabilistic as a way to tie together deterministic data. They already have enormous deterministic reach. With probabilistic capabilities, they can double or triple their ability to resolve audiences as people cycle through their devices and validate the quality of deterministic data needed for targeting and building probabilistic models. They own the entire customer journey from device to proprietary media and intent.

The fact that Verizon, Singtel and AT&T have a closed loop means they can wield their proprietary data like Facebook and Google and measure bottom-line success instead of leading indicators, such as accuracy, precision and recall.

The very nature of processing data, building aggregates and providing data as a service is a double-edged sword. The data is easier to consume, but like pasteurization, which sterilizes milk, processing sterilizes data at the cost of the metadata critical for probabilistics.

This is why telcos must own their own identity data and the associated metadata. By doing so, they can examine the performance of the data and optimize for results. As such, I believe the move to acquire and activate probabilistic capabilities is imminent, and will signal an actual understanding of the challenges that people-based marketing solves.

Verizon is closer to being battle-ready for the duopoly. While the telcos still own tons of data that connects to real people, one weakness is the frequency of logins from primary email addresses. Most email addresses that telcos provide are not primary, rarely touched and never used to register for an app or sign up for newsletters. This is where Verizon sits apart.

Verizon, by nature of its AOL and Yahoo acquisitions, owns active email addresses checked dozens of times per day. Add to that its stack of Convertro (AOL), BrightRoll (Yahoo), ad.com (AOL) and Adap.tv (AOL) and a leader in Tim Armstrong, and it has an advantage understanding what drives performance.

Driving performance is the point of building identity graphs. Which will be the first to realize that the best identity graph is the one informed by an understanding of performance, not on irrelevant metrics? Verizon and Singtel, with Amobee and Turn respectively in tow, have a huge head start.

I had argued previously that the most brazen challenger would be a cloud. I now believe it could be a telco, with the consultancies and Amazon looming in the background.

Follow Matt Keiser (@mrkeiser), LiveIntent (@LiveIntent) and AdExchanger (@adexchanger) on Twitter.

1 Comment

  1. Matt, you are right on the money as usual. The mobile phone number is one of the most persistent keys of identity (I've had the same one for 15 years). My question is--do telcos open up and provide services for marketers, or do they just become the 4th, 5th, and 6th walled gardens after AMZN, GOOG, and FB? I think it may be inevitable that government regulates consumer online identity the moment people data starts to be valued on balance sheets. They won't be able to resist the "revenue" (tax) possibilities.

    Reply

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