Gowthaman Ragothaman
Dec 11, 2020

Back to basics: Saving digital marketing in the era of walled gardens

To ensure digital marketing’s survival, we need to return to the internet’s decentralised roots, argues the CEO of Aqilliz.

(Shutterstock)
(Shutterstock)

Over time, the growth of the digital economy came not only as a great equaliser in terms of access and opportunity for consumers, but also competition. Today, businesses across the world traverse a borderless commercial landscape, each competing for every tap, click or purchase. Now confronted with the abundance of choice, consumers have had to navigate a crowded commercial arena as brands vie for their attention. Compounded with data, the rise of hyper-personalisation has enabled a new breed of audience targeting, whether it’s based on consumer interests or behavioural patterns—and consumers have come to expect it.

To win and retain consumer spend, 84% of surveyed shoppers cited that being treated like a “person, rather than a number” was critical, pointing to the persisting need to constantly monitor, understand and adapt to consumer needs.

To stay ahead, brands have relied on walled gardens with their lucrative ecosystems of service offerings that warrant the voluntary exchange of personal data for access. Over time, the growth and dominance of walled gardens have effectively shaped the digital marketing landscape as we know it today. In the US alone, some of the world’s largest tech companies account for almost 70% of all digital adspend in the country, having formed the backbone of how companies big and small choose to engage with their consumers. In light of this reliance, that number shows little signs of changing.

Simply put, the open web, as we know it, is under threat. Where do we go from here?

The crumbling cookie and first-party data plays

As months fly past, we find ourselves drawing ever closer to 2022: the fated year wherein support for third-party cookies will be eliminated on Google’s Chrome browser. With existing audience targeting tools and identity-management systems now being called into question, the appeal of walled gardens—which allow for deterministic matching, seamless log-in environments, and end-to-end visibility—is too valuable to pass-up.

For better or for worse, the presence of services offered by big tech, be it search engines, email providers, web browsers, or social media, are here to stay, and these offerings have largely become intrinsic to our everyday lives. Brands will continue to invest in these platforms, prompting a cyclical give and take, due to the lucrative potential for each click, like, view and follow to possibly translate into a purchase.

But as an industry, we need to look beyond that—and publishers are taking note.

For months now, several publishers have made a concerted first-party-data play, leveraging significant pools of subscribers. The New York Times, notably, announced that it would be limiting its reliance on third-party data for audience targeting by 2021. Across its over 6 million subscribers, the publisher has since built out 45 new first-party audience segments for the purposes of targeted advertisements with categories spanning age, income, demographics and interests, to name a few. Meanwhile, the past summer saw The Guardian implementing a registration wall to bolster its first-party data strategy, which effectively kills two birds with one stone: It not only reduces reliance on third-party cookies but also boosts subscriber retention efforts.

Other publishers are following suit across the world, and the progress thus far is certainly promising. But more work needs to be done. While it may be tempting to fall into the trap of generating multiple first-party data ecosystems, data silos ultimately only serve to limit, rather than strengthen, an effort to move away from walled gardens.

Embracing fundamentals

In fact, the construction of structures that stipulate ownership across the internet is very much at odds with the nature of the internet itself. Built as an inherently decentralised network that allows for peer-to-peer information flows, that is the very model we should strive towards.

The temptation to stick to what we know—an expensive, centralised third-party that offers limited visibility and remains plagued by the same inefficiencies we see in the martech ecosystem today—needs to be overcome. It’s clear that as we move towards an increasingly privacy-centric ecosystem, the industry simply wants the best of both worlds: the safety of walled gardens with greater data sharing capabilities.

Rather than limiting ourselves to disjointed first-party data pools, what we need is a trusted ecosystem that enables data collaboration at scale: an environment comprising participating brands and publishers who are able to share ethically obtained first-party data in a seamless, secure manner. This effectively mitigates our tendencies to go towards data silos, instead encouraging publishers and brands to share their data points within a fair, trusted, and decentralised marketplace.

This can be supplemented with emerging technologies such as distributed ledger technology to track a record of all activities and transactions conducted within the federation. With this, brands and publishers can be assured that all their record-keeping processes are compliant with even some of the most stringent data protection laws. For one, Article 30 of the European Union’s General Data Protection Regulation which demands that businesses can provide records of processing activities. As a demonstration of compliance, these records must show why and how data is being collected and processed. The recently voted on Prop 24, also known as the California Privacy Rights Act, demands the same from American businesses.

Most importantly, however, is that a federation such as this is poised to scale, ensuring that all participating stakeholders and the data that passes through are held to the same standards and in accordance with relevant frameworks. And the best part? It’s all embedded in the code.

A realistic way forward

As the industry gradually seeks to tear itself away from the existing monopoly of walled gardens, technology will continue to play a pivotal role as we attempt to chart a sustainable path forward. Amid dwindling budgets and far more modest spending throughout the past year, we’ve been given the much-needed impetus to step back and re-evaluate existing practices and approaches. Already, promising progress has been made with The Trade Desk's Unified ID 2.0 and when coupled with the advancements made within Google’s Privacy Sandbox, this exploratory phase is set to reap some rewards in the long run.

In re-examining approaches to audience targeting and identity management, we need to go beyond reframing them: we need something new. The success of walled gardens is a testament to the extent to which innovation played a role in their conception, alongside an acute understanding that one day, they would become intrinsic to the advertising ecosystem of the future. Rather than being limited by our past and our present, we need to do the same and continue to look forward.


Gowthaman Ragothaman is the CEO of Aqilliz.

Related Articles

Just Published

6 hours ago

In-housing is here to stay and growing

As digital communications have become more central to the way that companies do business since the pandemic, it makes sense for brands to invest in their own capabilities – whether external agencies like it or not.

6 hours ago

David Beckham finds escape in global Maserati ...

This is the debut work for the car brand by Droga5 London.

6 hours ago

Agency giants can continue renaissance with more ...

Agency holding companies have seen their share prices recover in the past six months. Now is the time to take on more risk by partnering smaller and nimbler tech-focused players to drive growth.

6 hours ago

John Hegarty invests in freelance matchmaking ...

BBH co-founder says AI interface that matches briefs to creatives is "the answer" to the ad industry's need to "access the growing freelance workforce with speed and effectiveness".