Pay To Play: The Future Of The Marketing Cloud

carlaholtzeData-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 Carla Holtze, CEO and co-founder at Parrable.

During the really early days of digital media, AOL and CompuServe were basically the only two consumer portals and total digital ad spend was less than $1 million. It seems like we have come a long way since then, but have we really?

Today, there are currently close to 1 billion websites in the world. As supply of ad inventory becomes more diverse and fragmented, marketers find it is increasingly challenging to achieve addressability as users bounce around the web with the touch of a finger.

The grim future of the cookie is only part of a much larger story. In some marketplaces, the use of hashed PII and device recognition technologies will help prop up the use of open-source tracking tools for a period of time.

Over the long term, however, it is time we all admit that the future of digital media and addressability is going to be a pay-to-play endeavor.

Increasingly, it will cost money to get advertising through the plumbing needed to reach customers and prospects. I’m not referring to the media, data, ad delivery or reporting costs. Rather, the sheer ability to recognize users on a device over time has become something that gets monetized.

Whomever owns the digital media tracking technology of the future is going to do one or more of the following: They will charge for its use, they will control how it gets used and/or they will subtly attempt to thwart competitors from using it at all.

As a current example, look no further than Apple. Without wading into the politics of Apple’s rationale for its changes to iOS 10 with respect to IDFA, Apple is now attempting to exert even more control over how its advertising identifier gets used.

And so it is from that perspective that I’ve been watching Oracle, Adobe and, more recently, Salesforce build out their respective marketing clouds over the past two years. Oracle might be further along in terms of acquiring a comprehensive addressability technology stack, but others – including the data brokers – are not too far behind. As these companies compete to create more effective addressability, there are a few themes I see emerging.

As The Cookie Crumbles

The problem with the marketing cloud tech stacks is that they are primarily built with HTTP cookies. Sure, back when HTTP cookies were essentially the sole mechanism for ad delivery and reporting, that’s what everyone used.

Over the past few years, an arms race has emerged. Today, there are large entities with access to millions of logged-in users across a myriad of websites, which doesn’t bode well for the future of cookies. If the name of the game is persistence and accuracy, traditional cookie-based technologies will have a difficult time competing with those who have actual logged-in users.

Sharing Is Caring – You Will Fail Without Scale

We’ve seen that many of these large non-walled garden companies with access to logged-in users are all building their own omnichannel graphs and marketing clouds independent of each other. There is very little sharing of data from one entity to the next.

Will those efforts will be hampered by the lack of shared identity across the myriad of tech stacks? The relaunched DigiTrust might be able to address some of these issues. In any event, I see scale and interoperability – or lack thereof – as significant impediments, to say the least.

Relying Solely On Someone Else’s Ad ID Can Be Risky

Everyone is building out a cross-device offering these days.

Oracle bought Crosswise to enhance its cross-device offering. Adobe is building its own publisher co-op for cross-device. Live Ramp is creating its own omnichannel offering. And Saleforce will almost certainly bolster what appears to be a robust offering from its recent acquisition of Krux.

However, all this building thus far has done little to address a key challenge for addressable media: Addressability is only as strong as its weakest link.

For example, the core pain point for just about any cross-device offering today is that they all essentially link to an advertising ID that is owned by another company, such as Google, Apple or Microsoft. However, that approach is only valid for as long as the owner of the advertising ID doesn’t decide to change its terms of use. All of the respective marketing cloud companies probably realize this – and are therefore likely to take steps to seek alternatives.

And that will be the moment when the race to build the ultimate marketing cloud is going to get really interesting.

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

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