By Jessica Shapiro, Chief Marketing Officer, LiveRamp
Advertising Week New York 2022 saw the return of advertising’s biggest conference to in-person, where we had much to catch up on as an industry. Whether it was contemplating retail media networks’ next move or exploring the promise of data clean rooms, one of the most prominent themes at this year’s event was data collaboration.
Data collaboration delivers highly-personalized customer experiences, powers precise measurement and analytics, creates competitive differentiators and forges strategic partnerships among internal or external teams. It’s indisputable that data collaboration will have a major role to play in 2023 marketing successes as the industry navigates economic uncertainty, new privacy legislation and ever-evolving customer expectations. Here are three predictions on where we’ll see data collaboration provide the biggest boost to our industry.
1. Marketers Will Take Ownership of Data
The role of the CMO is broader and more technical than ever before, requiring new skill sets, passion and capacity to stay abreast of changing technology. Compounding this is increasing pressure to prove ROI ー and fast ー something top of mind for 77% of global CMOs according to a new survey from LinkedIn and YouGov.
Data collaboration is an avenue for CMOs and marketing teams to meet these heightened expectations, enhancing the ability to use forecasting models to predict how campaigns will perform or develop attribution models that inform the C-suite on the full value of their investments. In 2023, we will see tech-enabled marketers with stronger go-to-market plans and the data they need to justify use cases they’ve long advocated for.
CMOs are also the voice of the customer and a core foundation in deepening customer focus is having the right data to determine the next course of action. The data must be comprised of deep qualitative and quantitative insights, both of which are critical to driving the business and meeting customer needs. This makes it imperative for the CMO to ensure their CIO, as well as product and sales organizations, also have these powerful insights.
2. Retail Media Will Be a Key Anti-Recession Tactic
As budgets tighten in times of economic uncertainty, technology is not an area to trim. It’s technology that streamlines processes and ensures advertising performs better and works harder. This is especially true for the measurement of media and related activities, which is how marketers prove ROI.
In the case of retailers, this means retail media networks. As retailers look for ways to increase measurement and drive revenue and profit into the new year, they will dedicate resources to strengthening and differentiating these data collaboration environments.
Using first-party data, third-party appends and lookalikes to collaborate with key partners in a privacy-first way will make data as rich as possible to improve performance for brands and suppliers. Retailers will offer more benefits to entice partners and grow revenue, helping to offset any reductions in topline sales amid an uncertain economy.
3. Data Clean Rooms Will Enable a Privacy-First Ecosystem
On Jan. 1, 2023, the California Privacy Rights Act (CPRA) and the Virginia Consumer Data Protection Act (VCDPA) will go into effect, followed by other privacy laws in Colorado, Connecticut and Utah in July and December. The industry will need to be able to comply with this expanding patchwork of state legislation without slowing business or dulling the customer experience.
This will put demand for data clean rooms at an even higher rate than the buzz we saw in 2022 and for good reason. These data collaboration environments are designed to optimize security and privacy without losing data utility, creating a durable foundation for companies to unlock new audiences and enhance personalization, optimization and measurement.
While privacy protections are inherent to these solutions, not all data clean rooms are equal. As more brands, retailers and media players tap into this advantage, the data clean rooms that use people-based identity to remove personally identifiable customer information (PII), offer configurable privacy between partners across brands, publishers, retailers and platforms and use federation to minimize data movement will become clear leaders in the marketplace.
Whether data collaboration takes place within a single enterprise or between a brand and media partner, it delivers more valuable business outcomes, be that unlocking new revenue streams, activating strategic partnerships or deepening brand engagement throughout the entire customer journey.
Data collaboration, when executed in a way that preserves privacy and enhances customer experiences at scale, will transform business. I can’t wait to see what 2023 has in store.