"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.
It was one year ago during Advertising Week that Facebook introduced people-based “marketing” with Atlas. I consider that phrasing to be PR, at best, since marketers are forced to upload known data into Facebook’s platform in a way that keeps marketers from closing the loop on measurement and attribution.
That inconvenience means that marketers’ known first-party data is used for targeting and modeling but is converted into anonymous aggregate data before it is returned for reporting and attribution. It’s a step forward for advertising but the inability to close the loop on data is a step backward for marketers.
Regardless – or perhaps because of this – several contenders have entered the melee, lured by the siren song of people-based marketing, including Salesforce, Verizon/AOL, Criteo and Oracle, among others.
The Battle Of Voltrons
In the animated TV show “Voltron,” a super robot would form from five robotic lions to do battle. I see a parallel in the fight for people-based marketing dominance as companies amass the right parts to conquer the field. I continue to enjoy that metaphor, no matter how nerdy.
Facebook's Voltron was first and has a head start. Its people-based advertising platform combines multiple technologies built on top of its super power: the identity graph generated every time a Facebook user logs in.
This identity graph forms the heart of Facebook’s Voltron, empowering it to target people, not pixels, while providing a vehicle to affix to its other ambitious technologies. Its main weapons are LiveRail for video, an optimized audience network appendage allowing advertisers to extend the use of their first-party data from their Facebook ads to other apps and, of course, its big gun: Atlas. Until now, its throne was unchallenged.
Atlas was engineered to beat Google, but everything has changed. With Atlas, Facebook made Google’s PixelTech (DoubleClick) antiquated overnight. Facebook’s completed Voltron, with its ability to target people far beyond Facebook’s walls, created the playbook for rivals to follow.
Facebook has been the only one that had amassed anything like it. Google, even with its ad server, supply-side platform (SSP), demand-side platform (DSP), mobile ad network and marketing attribution arm, was no match without the ability to target first-party data cross-channel and cross-device. What Google still truly had, as Kelly Liyakasa noted, was a dependency on the cookie.
But with last week’s news, Google's Voltron will no longer be hobbled by cookie dependency and forced to market to pixels. Now it can market to people using CRM or first-party data that nearly every brand has in droves. And Google has intent data, which is superior to things liked on Facebook or the web.
But will this battle for supremacy really be limited to just two players?
The Potential Rival Voltrons
Salesforce would be a natural contender, but it isn't as aggressive as it could be, in terms of closing the loop with paid media. Salesforce recently announced it would integrate with partners so its customers could leverage any of the primary advertising networks and technology platforms they already use. Since Salesforce is choosing integration over doing the heavy lifting itself, this strategy may seem guarded, leaving money on the table, but I think it is reasonable, given its focus.
Adobe is well-known for its acquisitions, but is conspicuously lacking ad-serving capabilities. Adobe did buy Demdex and Efficient Frontier before getting cold feet. Just recently, Adobe upgraded its DSP but the competition is fierce and conquest is hard without a way to clearly demonstrate superiority. It’s been quiet and operating somewhat behind the scenes, but with all its assets, it has a very broad set of capabilities.
Criteo has amassed a large identity graph. More than 80% of its clients participate by leveraging its cross-screen solutions. However, Criteo flies under the radar in people-based marketing because it wields the power of the graph silently. Its automated approach and behind-the-scenes use of its identity graph makes it the leader in mining intent data, which is needed to retarget the right product to a person irrespective of device or browser. Until now, it was without rival, but Google enters the fight with the intent and data science to compete. But Criteo is considered the standard to which all aspire: fully integrated from the collection of intent data to its use across device and browser. It should be watched very carefully.
AOL/Verizon’s merger earlier this year was savvy. AOL had previously acquired Convertro, which provided a top-of-the-line attribution solution and, I believe, is the solution for AOL/Verizon’s identity graph. If Verizon can match its data to AOL’s capabilities, the impact is impossible to overestimate. It’s not, however, an insignificant “if.” They’ll need to execute while managing privacy. That sounds simple, but is incredibly complex. It is by no means a done deal and eyes are on them.
Yahoo was once so ahead of the game. It bought Right Media in 2007, a crown jewel brimming with talent like Brian O’Kelley, founder and CEO of AppNexus, but never got its act together. It went from first-mover to also-ran, although there are signs it is joining the people-based marketing game. Yahoo Japan is leading the way with the most comprehensive people-based platform built on open architecture. Perhaps Yahoo has incubated the model for domestic success in a different market than the US.
Can Oracle’s Voltron break through the garden’s walls? Oracle asserts it doesn’t want a walled garden, and there’s a thirst for that. Brands resent walled gardens, which require that they hand their data over for one-way use.
Oracle is attempting to let advertisers bring the same cross-platform and cross-device utility that people-based advertising offers without restricting that utility to those walled gardens, thus making it people-based marketing, not people-based advertising. This isn’t out of altruism. Since it doesn’t have its own data trove, Oracle must give more than it takes, offering openness as compensation. Oracle is aggressively arming its Voltron to do battle as a central hub for pushing data into walled gardens and open platforms.
Given its acquisitive track record, how long before Oracle acquires assets to put its identity graph and associated intent data directly to use, as Criteo has?
Think of all the resources poured into RTB: DSPs acquired, SSPs built, DMPs optimized, all designed to give brands the ability to target, manage, measure and do attribution across buys on any platform or network, as well as 360-degree attribution on first-party data.
The cookie’s limitations required these complex workarounds and necessitated the complicated, inefficient and expensive cookie syncing at the heart of RTB. People-based marketing taps directly into CRM and first-party customer data, making cookie synchronization unnecessary for onboarding into platforms that support people-based marketing, although cookies are still central to ad serving.
Many RTB innovations could be for naught because walled gardens move us back to the portal, with its siloed data. We’ve ended up back in closed proprietary systems where data only flows one way, from brands to Facebook, Verizon/AOL, Twitter and now Google.
Change Around The Corner
Brands control ad budgets and have learned from the past, which is why they are investing aggressively to become publishers. In my opinion, the ball is in their court. If they prioritize budgets to open platforms, they will force many walls to crumble. With a little pressure, companies will be forced to support integrations that allow for true people-based marketing, not just people-based advertising.
Now that Google has responded to the Atlas threat, it may address Oracle’s Voltron by being a fast follower. Google could easily provide an alternative to the walled garden it has erected around its data to confront Oracle while holding Atlas at bay. It would need to allow DFP customers to participate in a co-op, which would give it the largest graph of all, assuming publisher participation.
Will Google follow Oracle and amass the power of its customers’ data in a public graph available to all its customers as a second act? Oracle published its recipe just like Facebook did, so Google now has what it needs to replicate the success and be a fast follower, as it did with Google Drive (Dropbox), Google Docs (Microsoft Word), Google Cloud (AWS), Google Search (everyone) and, most recently, Google Custom Match (Facebook Atlas). It already has the tags on the pages, mobile and desktop. That means it has the technology and the relationship.
If Google can deliver the promise of people-based advertising combined with Google intent data, without the onerous step of asking customers to change platforms, Facebook Atlas needs to be on high alert. Google’s done it from a standing start before and won (RIP Right Media).
Are more Facebook innovations on the way to differentiate further? It could extend Atlas to other media channels that act like logged-in media, which would provide Facebook the ability to add these channels to attribution models without sharing data beyond its walls. This is possible because every impression in logged-in media and in email, which acts like logged-in media, has a deterministic match to the user.
I predict the last Voltron standing will have the most reach across online and offline. The race is on to see which most cleverly wields its identity graph ax.
[Editor's note: This is an updated version that reflects Salesforce's decision to integrate with external ad tech partners. The original story incorrectly stated that Salesforce would not integrate with ad tech.]