The Future of Data-Driven Marketing Is Inside Data Clean Rooms

This article by Matt Kilmartin, CEO, Habu, describes how forward-looking brands are working directly with their most important and strategic partners within a data clean room to power their marketing initiatives.

Savvy marketers shrugged when Google announcedOpens a new window it would no longer support user tracking in Chrome come January 2023. They had seen the writing on the wall long ago and were deep into building a far more accurate and sustainable approach to data-driven marketing: distributed data ecosystems that support privacy-compliant data collaboration (more on that in a bit).

There’s something to be said for accepting reality and getting on with things. Consumers have been unnerved about data tracking, and the regulators are stepping in. As a result, our industry has experienced a steady decline in the volume of available data and identifiers, and companies that once willingly sold it have been shutting down sales. Even Google, Facebook, and Amazon have turned off their spigots.

At the moment, user IDs for targeting are highly fragmented, which will make it difficult to enable the industry to pick up where it has left off. The time has come to reimagine digital marketing and advertising as we know it, and we’re fortunate that some forward-looking marketers have been doing just that. After getting their feet wet with Google Ads Data Hub and Amazon Marketing Cloud — and seeing the insights that stem from unlocking the data that’s available there — innovative brands view data clean rooms as instrumental in the post-cookie world.

As I speak to more and more marketers, they’ve shared that while 2020 was about education, 2021 is about taking action and identifying their most important and strategic partners to collaborate within clean room environments.

Learn More: 3 Ways AI-Powered Predictive Insights Can Help Publishers Overcome Identifier Loss

More Than Audience Overlap

It’s a common misconception that data clean rooms are simply a secure environment for two brands to share their data for basic audience overlap. But that’s just the tip of the iceberg. Modern clean rooms have an intelligence layer and offer end-to-end solutions that enable brands to take action on insights gleaned, include audience segmentation and activation, customer journey analysis and closed-loop attribution and measurement.

I’ll give you a simple example. Let’s say you’re a financial services organization, and you launch an advertising campaign to promote mortgage options that appear on CNN.com. You can set up a data clean room with CNN to understand the upper funnel activity of which of their users saw your ad and then visited your website.”

To add mid-funnel activity to your customer journey, setting up a clean room with a publisher in your sector, say a Trulia or Zillow, would then allow you to see which of those users moved further down the funnel path toward conversion. By bringing yet another data source of highly valuable conversion signals into a clean room, you’re now closing the loop on the journey and getting a much clearer picture of a customer’s path to purchase than was possible before. 

Learn More: 5 Steps To Integrate AI Into the Fabric of Enterprise Marketing Automation

Embracing Living With Data Silos

Our industry has gone through a number of about-faces since its inception, and we’re actively undergoing another one. After 15 years of declaring data silos as the enemy of marketers, astute brands understand that in a privacy-first era, data must remain distributed. They understand that they need to work with partners who can access that data from whichever environment it resides and extract the insights to answer the questions they need to drive growth for their business. Data clean rooms provide them the ability to access disparate data sets wherever they live. (This notion of working with data where it lives is the distributed data ecosystem that I mentioned at the top of the article.)

Privacy-safe distributed data ecosystems give brands the freedom to utilize data in many ways and for many use cases — assuming there is a strong data governance layer in place that enables the data owners to determine which data is seen by the analytics layer, the exact use case for the data, and the timeframes for which that data may be used. This privacy and governance protection allows brands who never considered sharing data before to do so with their most strategic partners in a secure and compliant way.

Learn More: Customer Success as the Flywheel of Corporate Growth and Profitability

Data Democratization

At present, data clean rooms are mostly designed for data scientists, and that needs to change if distributed data ecosystems are to flourish. To thrive in this new era of disparate data, we need to realize that there will be multiple people within a brand who’ll use the tool, most of whom have no background in data science. 

So while data clean rooms will always need tools that enable data scientists to run complex query analysis and modeling, they also need business-friendly pre-packaged analytics tools that everyday marketers can use to measure and optimize their campaigns quickly. This is particularly important given that distributed data is the new realityy, and technology needs to serve across multiple business functions. And this notion of distributed data also exists beyond advertising, so it’s exciting to see innovative brands are leveraging data clean rooms in transformative ways that drive value to many facets of their business. 

As cookies and other identifiers become obsolete, and data remains distributed, smart companies are turning to data collaboration in secure environments to continue to deliver the business outcomes that benefit their brand and consumers alike, and that’s a positive development for all of us.