How cloud technologies are helping media companies unlock the value of data collaboration
Bill Stratton, global head of media, entertainment and advertising vertical, Snowflake
Many of today’s media businesses and advertisers are redefining their business models in response to shifts in consumer behavior and the availability of new technologies. For instance, over the past few years, content creators such as Disney, NBCUniversal and HBO have begun selling their content directly to consumers via digital streaming services.
As they work to drive revenue from these new direct-to-consumer offerings, media companies are relying more than ever on the intelligent use of first-party and third-party customer data. They know that the most effective way to precisely target new and existing customers and deliver a relevant ad experience is to combine their own data with that of partners. To do so, they need solutions that meet their strict requirements for data governance, security and privacy.
Addressing secure data sharing
As these brands and advertisers move beyond their former roles in the industry, they find themselves taking on responsibilities that they’d previously outsourced to trusted third parties. In particular, they have to address the data governance, privacy and security issues that come with handling consumers’ personally identifiable information (PII) themselves.
The old approach to sharing data between a brand and its advertiser — using an anonymous cookie or taking snapshots of relevant data and sending copies back and forth — is no longer effective or sufficiently private and secure. In addition, the information wasn’t dynamically updated or always-on, so it was less valuable.
The evolution of data clean rooms
The concept of a ‘clean room’ originated when companies going through an M&A process would upload all their documents to a “clean room” operated by an independent legal entity. The term was expanded and used when two companies would send their customer data to a trusted partner like Acxiom, Experian or Merkle. The third party would conduct the matches between the companies’ data and share whatever insights emerged. However, as more groups within a media company sought access to those insights, it became challenging to provide it at scale.
As cloud architecture developed, it opened the door to additional solutions that allowed brands to operate their own data clean room or collaborative environment and design their own rules for data sharing and matching. This means that restricted consumer data elements can be shared securely while retaining the consumer’s privacy because the data never actually leaves the owner’s environment. Previously, tech giants such as Google have run their own privacy sandboxes. Now, the technology to enable this concept is available to a much broader set of organizations via managed cloud services.
Key to understanding the data-clean-room concept is the idea that the brand’s or advertiser’s own data is never moved or copied. Instead, it’s a single instance of the up-to-date information sitting in a cloud database that is being accessed or combined with other data within set security and privacy parameters.
What’s possible inside the data clean room
Considering an example in which a brand wants to place an ad for its running shoes on a media company’s streaming service, the brand already knows a lot about its customers’ demographics and purchase behaviors from prior interactions, while the media company is familiar with the programs its customers watch.
Both companies want to combine their data to arrive at a target audience segment most likely to be interested in buying the brand’s running shoes. This could involve upselling to current customers or tuning out current consumers to only target new audiences.
Using a data clean room, the brand and the media company can each confidently provide their own customer data without revealing any PII to the other party. Double-blind data joins can be performed involving data encryption on both sides and the creation of secure functions to compare data. The companies may opt for an overlap analysis to see where they have customers in common. Alternatively, they may conduct a lookalike analysis to determine which of the brand’s customers resemble those of the media company for expansion opportunities.
Any data queries within the data clean room are restricted to guard against the re-identification of any PII based on a process of elimination and to prevent any repeated malicious attack campaigns. The data clean room participants also have full visibility and control over who is accessing which data and can revoke access at any time.
Early days for data clean room adoption, but demand Is growing
While the data clean room concept is still new to many, demand is accelerating for two main reasons — the deprecation of cookies and changing expectations regarding how CMOs demonstrate the value of their marketing spend. With tenure at its lowest level since 2009, CMOs are under increased pressure to show the precise business outcomes of their ad and marketing campaigns, and this is information they can extract from a data clean room.
Advanced marketers and big media companies are positioning their data clean rooms as highly secure environments where their data, and their clients’ data, are protected and can be combined in joint analysis in adherence with privacy standards. The insights gained will help them assess and plan for current and future consumer content needs.
The future for the media industry is clear: Data collaboration and trust will drive the future of the advertising ecosystem. Data clean rooms are a crucial solution to help companies participate in the ongoing digital transformation of the media and advertising landscape.
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