Who Can Challenge Facebook In The Deterministic New World Order?

faacebookatlasNo one’s going to say that walled gardens don’t have their perks. Just look at Facebook and the new and improved Atlas.

Facebook’s long-awaited announcement of a cross-device user ID solution, made Monday as part of Advertising Week in New York City, invites advertisers into a putative Eden that gives them access to what could be 800 million cross-device logged in users. The solution comes with a new reporting tool, released in August, that tracks ad performance across devices.

But what advertisers don’t get is true data portability.

“Yes, companies like Facebook and Google have logged-in authenticated users and a lot of PII [personally identifiable information] which makes it easy for them to connect the dots across multiple devices and platforms, but that data still exists somewhat in a silo and there’s a limited reach,” Forrester research analyst Jennifer Wise told AdExchanger.

The latter point is particularly noteworthy, Wise observed, as scale “is going to be a problem for Facebook and the others, at least in the short term” – and that’s because there’s no standard cross-platform device ID.

“Google and Facebook obviously have a leg up on everybody because they’re bigger and they have IDs and everybody gets that,” said Lotame CEO Andy Monfried. “But what would be really good is if Facebook would give the IDs back to the marketers that spend with them.”

As Merkle CEO David Williams recently pointed out in a chat with AdExchanger, Facebook is in a strong position to close the cross-device loop, “but the underlying problem with addressable audience platforms like Facebook is that it might solve the issue on Facebook, but what happens outside the walled garden?”

While there’s certainly great value in the authenticated user identity the deterministic players can provide, that value is arguably limited by the lack of a single ID that advertisers could use for true attribution. (Though it's only fair to note that Facebook seems to be aware of the attribution issue, which is conceivably why it chose Omnicom as an Atlas launch partner.)

“Advertisers are spending tens of millions of dollars through Facebook and Google,” said Surag Patel, VP of global product management and marketing at Experian-owned security and fraud protection company 41st Parameter. “I wouldn’t be surprised if advertisers are giving them pushback on the data ownership issue.”

That's not to say Facebook couldn't come up with a potential solution to bypass the ID portability issue. For example, as AdExchanger previously noted, one thing Facebook could do is give other data platforms and advertisers the ability to build tech on top of Atlas along the lines of how preferred developers leverage Facebook's Ads API.

But as it stands now, first-party advertiser data goes into Atlas, but cross-device user profiles don’t come out. At least not in a way that advertisers can use them to match up with existing audience data or to inform their campaigns through other platforms. David Jakubowski, who presides over Atlas and the Facebook Audience Network, said as much in a previous interview with AdExchanger: “You would be able to access all of the people-level reporting inside of the Atlas wall and inside of the Atlas reporting interface.”

In other words, outside players will not be getting their mitts on what Jakubowski called “the translation layer” – although some certainly want to.

“Brands and agencies are wary of being at the mercy of companies like Facebook, Google and Apple,” Amobee CEO Mark Strecker told AdExchanger. “They’re saying, ‘I don’t want to be beholden to these three companies.’ It’s a big battleground. Who is going to be the de facto standard when you log into things? Facebook has logged-in user data, Google is trying to do it with Google Plus, Apple has its Apple ID – and that can be extremely powerful, if you can be the one.”

But if what happens in Facebook stays in Facebook, at least from a data ownership standpoint, advertisers might need something to help them connect the cross-platform dots in a broader way. They could jury-rig their own identifiers for a cross-channel customer view – or perhaps there’s room for an industry coalition.

If players with logged-in user data like Twitter, Pandora, Verizon and others with the ability to deterministically device-match all banded together to create a universal cross-device ID, Facebook and, ostensibly Google, although Google’s cross-device plans are unclear at the moment, would have a serious run for their money.

Or would they?

“That would be great if cross-device tracking in the US was the only problem Atlas addressed,” said Marc Poirier, founder and EVP of performance marketing company Acquisio. “However, except for Twitter, none of these companies have significant global reach, and even if we only consider the US, they just don’t have the depth of insight into who their users are that Facebook has.”

What, then, about the probabilistic contingency? Companies like Drawbridge, Tapad (both of which introduced analytics solutions over the last few weeks) and Experian’s AdTruth use statistics to try and identify user IDs by tapping into multiple sources of non-PII customer data. On the surface, it might seem like Facebook is “better” because it can determine with 100% exactitude who’s who, but the statistical model can also provide value.

As OpenX GM of mobile Rob Kramer noted at an Advertising Week session Monday on mobile programmatic, “[f]irst-party data is extremely valuable, but in combination with third-party data it becomes even more interesting to the buyer because they can add additional audience data to specific users.”

And just because these solutions aren’t deterministic doesn’t mean they should be dismissed out of hand.

“The Conversants, Tapads and Drawbridges of this world have collected some fantastic data on hundreds of millions of anonymized users across multiple environments and in multiple locations,” said Ben Phillips, global head of mobile at MediaCom. “This data, especially its flexibility, is hugely valuable to advertisers.”

As Wise put it: “Players like Tapad and Drawbridge have a good opportunity to connect the dots because their data is all third-party, so there’s no chance of violation of privacy, and they can potentially be integrated with anything to provide scale.”

But while Phillips is optimistic about the cross-device players and their ability to integrate with other media channels – “the big device ID players want to keep users within their environment only,” which, he said, “presents an opportunity for probabilistic cross-device companies to innovate” – Acquisio’s Poirier is less convinced, though he has a feeling that Facebook’s move might finally spark some action from Google.

“I don’t think being unable to port one’s data would limit the effectiveness of their campaigns, [but] it does mean that if advertisers want to use Facebook user profile data to target their ads across devices they will need to use the Atlas ad server, not [Google’s] DFA [DoubleClick for Advertisers] or any other third-party ad server,” he said. “Because this data is in high demand. and the only way to have it is to use Atlas, this puts immediate pressure not only on Google’s DFA product, but also on the entire display-buying ecosystem as advertisers will likely flock to Atlas in droves.”

But that still doesn’t solve for what some see as the industry’s ultimate need – that of a true universal cross-device ID.

“The reason people love cookies is because they work on the computer and a successful replacement needs to be open so that everyone is able to use it, privacy-safe so people feel comfortable with it ... something which different platforms can collaborate around,” said David Wong, VP of product at Nielsen, speaking at a Monday Advertising Week session on the quickly crumbling cookie.

Although Facebook “is trying to solve the cookie problem by using Facebook identity,” Atlas managing director Erik Johnson noted during that same session that, “[w]e don’t think any one company can do this on their own.”

In fact, Facebook partners with a variety of companies and agencies, including holding company Omnicom and its data arm Annalect, Neustar (where Jakubowski used to work and whose DMP Annalect standardized on last November), Kenshoo, Marin Software and Nielsen to extend Atlas’s reach.

“What’s important for the ecosystem as a whole is to embrace these companies and find a way to work together,” Johnson said.

To that end, the question could be more a matter of industry want rather than industry need, said Joe Laszlo, senior director of the IAB’s Mobile Marketing Center of Excellence, who noted that while there may “be a strong desire for a universal cross-device ID solution for the market,” he wouldn’t go so far as the say that the industry requires one.

“I do think, however, that there's a need for a clear, concise set of principles for how these emerging cross-device IDs are generated, used, disclosed to the consumer, and how consumers should be enabled to control them,” Laszlo said. “But a single, universal solution would tend to stifle innovation, and more importantly it creates risks for the industry associated with having a single point of failure.”

 

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