For years, digital marketers were caught in a market dominated by Facebook and Google. These walled gardens, which are online environments where user access to network-based services and content are controlled in order to keep them engaged, were appealing because they provided a level of targeting and measurement unseen in the history of marketing. These environments had limitations, however, because their control constrained the advertising options available to brands and the audiences they could reach.
In 2023, the Facebook/Google duopoly has no doubt ended, but the reign of walled gardens appears to be continuing. With the rise of retail media networks (RMNs) and ad-supported streaming, there is now a range of channels that, similar to Facebook and Google, allow marketers to purchase advertising based on the platform’s first party data. While these new walled gardens offer a lifeline to targeted advertising in the wake of third-party cookie depreciation, the closed platforms are far from paradise for advertisers, as they can present a challenging obstacle course of burdensome administration, high costs (more on that later), limited insights, and limited reach.
In order to successfully navigate the new walled-garden landscape, brands should consider the following tips and best practices.
Surveying the Walled Garden Offerings
From Walmart and Target to Kroger and Albertsons, nearly every big box store and grocer to date has launched their own media network. The trend has now found applications in other industries as well, with Netflix recently joining other streamers in building a media network. Brands in the travel sector, such as Marriott, and the ride-sharing space, such as Lyft, have also launched their own media networks in the past couple of years.
These media networks excite marketers largely because they offer unique customer insights, and, in the case of retail, they have proven to drive conversions. However, these networks also present a sense of dread because of their sheer volume. According to a recent survey from the Association of National Advertisers, 56% of CPG brands are working with five or more different RMNs. Because brands cannot spread their ad budgets across an infinite number of media networks, marketers must determine what each of these walled gardens offer and which work best. This analysis requires a look beyond audiences and into the data enablement capabilities that each provides.
Balancing Different Walled Gardens
Despite being in the early stages, some CPG brands have already developed sophisticated campaigns and strategies with retail media networks. Brands have shown, for example, the capacity to give customers access to coupons so that when they visit a certain online store, a suite of promotions is available right on the digital store shelf, attracting different buyer segments with highly relevant messaging. While this can be relatively easy to set up through one retail media network, the challenge grows when attempting to do the same in additional walled gardens. Beyond the hassle of having to use different platforms, all with their own interfaces and protocols, these closed media networks can be overwhelming because of the different data sets they yield. As a result, marketers should consider adding data management solutions to their tech stack, which can serve as a centralized repository for all of the data they are collecting.
One of the main differentiators among the media networks is cost. Facebook and Google dominated the ad market over the past decade because they understood that limited supply plus high demand equals higher prices. While Facebook and Google have operated separately in their own spaces when it comes to advertising, they both offer only limited transparency into competing bids, as well as a lack of options to scale. So it’s not just the cost associated with higher pricing, but also limited insights into results, that force businesses to spend even more money to achieve marketing goals. The new media networks must keep this in mind when building relationships with advertisers, as the old model was not sustainable for most brands.
Combining the Value of Multiple Walled Gardens
Data enablement solutions that have capabilities to resolve identities across all systems will help brands start to break down the barriers that walled gardens put up by connecting the dots across various customer touch points. In the ideal scenario, a brand is able to leverage a closed media network, say Disney’s, and its proprietary data with an Amazon or other retailer, so that marketers can derive granular insights, like whether a certain audience is in the market for back to school and 30% of those are gamers. By breaking down these silos with customer data platforms and identity solutions, brands can begin to access insights that allow for a truly personalized customer experience.
At the end of the day, walled gardens are not inherently bad. The fact is that there are many benefits to be gleaned from them. However, the reality is that there needs to be a balance, and advertisers need to make sure the scales are tipped in their favor. How? By leveraging the pros of walled gardens, which include being able to be more targeted, while mitigating the cons, which include higher pricing, less attribution, and limited visibility into the details of your campaign. Be informed, be strategic, and be purposeful.
