Why IBM May Control The Future Of Digital Media

christopherskinner“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Christopher Skinner, CEO at MakeBuzz.

It’s all about the data, right? At least that’s what everyone says about digital media.

In today’s LUMAscape-driven world of data-driven marketing, getting your hands on differentiated data makes the difference between delivering mediocre performance for brands and becoming a “must buy.” Google and Facebook have cracked the code of digital marketing, mostly because they get more data than the brands themselves. However, in the case of display marketing where commoditized cookies are king, getting access to first-party data and knowing how to leverage it is what separates the ad-tech men from the boys.

But who is getting the client data these days – and what does data access portend for the future of digital marketing? Let’s look at two types of data, and who gets access to them:

Media Data

When a digital campaign runs, the data collected, such as audience, content, performance and pricing data, is always closest to the vendors. The DSPs, publishers, data providers and DMPs get the data first. Agencies also get campaign data but are often at arm’s length from the real data, and sometimes only get an aggregated or delayed view of granular performance data. Unless you control the “pipes” through which programmatic media runs, you are never going to be the first to know. Vendors don’t trust agencies with raw data feeds, and certainly do not trust agencies to safeguard their client data and not leverage it in wider use.

In a world where first-party data is king, agencies seem to be at arm’s length from the information that really matters. For example, when you see Babs Rangaiah talk about the partnerships Unilever has created to engage digital consumers, you see big, deep engagements with publishers and platforms like Twitter and Facebook – the publishers that are closest to their users’ data.

Sales Data

What about first-party sales data? That’s the real gold. Facebook didn’t get truly interesting for CPG marketers until Datalogix used offline sales data to prove that its campaigns could move soap from store shelves. Point-of-sale data, combined with CRM data, is getting mixed into data-management platforms and helping marketers target consumers with the right message at the right time – the holy grail of marketing that we were promised 18 years ago when the first banner ad launched.

So, who is getting this data? It is certainly not the agencies. They might give hashed CRM files over to a retargeting company, or even provide some cookie data for a “lookalike” campaign, but real sales data stays in the client domain.

But it’s more than sales data that keeps agencies and media vendors at bay. To get a seat at the boardroom table and really be a partner, the conversations start to become about not just growing awareness, but about growing revenue. How can media move the sales needle, drive profits and optimize corporate efficiency? Where do the new customers need to come from, and what existing customers can spend more? Those are the questions that, if answered, really move the needle. Clients are not even having those conversations with their largest and most strategic media partners.



So, who can have those conversations? If not the agencies or the media vendors, then it’s management consulting firms. The McKinseys and IBMs of the world are used to looking at deep client data, including sales and CRM data. They are also good at talking at the board level, and understand how marketing tactics can impact the P&L. They don’t have a stake in the media game, either.

If you look at the drawing above, it’s clear that consultants can get their hands on both media data and client data directly – where they are in the perfect position to make recommendations that can impact a brand’s real P&L challenges. It’s hard to argue that agencies or big media platforms can put themselves in such a position, especially given the challenges around media arbitrage, and the inherent conflict of interest that engenders.

Look at some recent consulting and digital agency tie-ups.  Agencies like Olsen, which recently acquired PulsePoint, an Austin, Texas-based firm, are looking at acquiring management consultancies so they can get closer to the boardroom. Conversely, Deloitte’s acquisition of Banyon Branch, a digital marketing specialist, looks to match boardroom strategy with digital and social media execution.

Want to make a bet on the future of digital media? If you think having access to client and media data makes all the difference, then I would go long on management consulting firms – or a new breed of media consultant that can get access to the data that really matters.

Follow MakeBuzz (@MakeBuzz) and AdExchanger (@adexchanger) on Twitter.

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  1. Very nice analysis here. If agencies want a seat at the boardroom table, they are going to have to show clients they can build the marketing frameworks capable of *creating* new customers in the digital channel. But that does indeed mean getting more access to the first party data that matters. Not sure that can happen without more transparency in media practices.

  2. I can confirm that agencies are already building these platforms and they are using companies like Unified Social to connect the dots between media data and customer data. My thesis is that big enterprise companies like IBM, Oracle, SFDC and Adobe will not execute effectively and social cloud marketing platforms will win. My experience is that large enterprise companies move too slow and this industry is moving in real-time. Their own bureaucracy will hurt them.

  3. Capitalizing on existing consumer demand and converting it to a new customer is largely commoditized at this point. Converting the low hanging fruit at the ‘bottom funnel’ demand requires access and mastery of media data. But market leaders need to do more than just convert existing demand…they need to create new demand in the right prospective customers.

    Moving up the funnel to have a dialogue with consumers who are not presently in market and actually create new demand requires access to first-party client data for both the targeting and measurement of campaign success. It is this next generation of media consultants that gets a seat at the table and changes the dialogue from transactional “buys” to strategic initiatives that have direct P&L client impact. The discussion moves away from “last-click vs. view-through” to analysis of incremental new customer growth and the profitability of those new customers.

  4. Consulting firms have no more access to first party data than most agencies do. They have plenty of experience in analyzing data and integrating systems but do not generally have direct access to 1st party media or sales data. In my view, you have left out an entire industry segment that not only has “access” to first party media and sales data but actually builds and maintains the infrastructure necessary to manage it. This would be the Database marketing/marketing service provider space. Companies like Acxiom, Epsilon and Merkle have been building and managing marketing technology stacks that include both 1st and 3rd party data for years. Clearly management consulting capabilities are becoming more important in an addressable world to drive oganizational transformation. My bet is it will not be the managemet consulting firms that win this battle.

  5. If you pull it all the way back, the genesis for success is built with the accurate connection of the online and offline consumer data that is then woven within and across the digital world. The absence of this vital connectivity is like trying to applaud with only one hand.

    We all agree that the accuracy of cookies is questionable at best and their future will be cut short. The holy grail is awarded to the trusted companies that connect first party data and third party data within a privacy compliant solution that scales to the digital world.

    These companies have solid foundations built from billions of data points that create a beautiful consumer symphony enabling pinpoint targeting accuracy. Gone are the days of looking for needles in a haystack. This plethora of analyzed and finely tuned Big Data enables the creation of segmented stacks of needles, not hay, that when reached increase revenue, improve marketing ROI and create a very engaged loyal customer/prospect. They have earned the moment of truth in real time with the consumer and can measure the impact with the back end data.

    I agree, the management consultants will have their part in the orchestra of digital marketing. However, in the end it will be the data maestros of the industry that earn the standing ovation from the advertising world. And that applause will be with both hands from the consumers who are reached!

  6. Thanks for your comment, David. As you point out, the one exception I would make is great CRM agencies like Merkle that are trusted with their client’s first party data. However, my larger point was that—in order to really impact the bottom line—agencies and consultancies have to get access to the boardroom and be involved in conversations that go beyond marketing to build new, disruptive digital frameworks that can actually change the business itself. Very few agencies are having those types of conversations now, because they require real data-driven frameworks and deep understanding of a client’s business, down to the P&L level.