According to eMarketer, almost 70% of all U.S. digital advertising spend goes to ‘walled gardens’ such as Google, Facebook and Amazon. This shift is due to the perception that these environments will continue to offer them real-time, optimised audience targeting at scale. But are there viable options outside of these safe havens?
In this blog we’ll discuss:
- The concept of ‘walled garden’
- What it means for B2B marketers
- The growing importance of data democracy
- The life outside of these walls
So, what is a ‘walled garden’ and are they taking over?
A ‘walled garden’ is a closed ecosystem in which all the operations are controlled by the ecosystem operator.
In simple terms? It’s where organisations like Facebook, Amazon, Google and LinkedIn as well as some ‘membership’ style media groups that hold all the cards (and information). They have a lot of data on their users from age, gender, location, interests and even browsing behaviour. While the ‘walled gardens’ know a lot about the users in their logged-in environment, they—by necessity— can’t share their data with marketers without running into privacy concerns.
Sorry, you can’t take anything with you is the general message you receive as a marketer when you employ marketing campaigns on ‘walled gardens’.
For example, LinkedIn lets marketers run targeted campaigns, but doesn’t share any other information about where the ads are, what time they’re running etc. It’s only if and when the user interacts with the ad, the marketer will know about it. The marketer will not know who actually viewed the ad unless the user fills in a form, however, this is all still information LinkedIn has.
It’s the wall that keeps getting higher…
Marketers are spending more on these ‘walled garden’ digital advertising platforms. According to the Competition and Markets Authority, 80% of all UK digital ad spend goes to Google and Facebook. And with Google’s announcement that it will phase out third-party cookies by 2022, it’s clear that those walls, which keep so much of the data inside, are about to get even higher.
What does this mean for B2B marketers?
The beauty of these walled gardens lies in their abundance of owned and constantly updated first-party data. Marketers can use this to deliver and measure targeted, brand-safe ads to users with reduced risk of privacy compliance violations or other customer data blunders.
But it’s not all roses…
The more time B2B marketers spend on these platforms the less they could understand about their customers. By using walled garden campaigns you sacrifice any useful data insights as it can’t be tied back to your CRM database, leaving it floating around like tumbleweed. This leaves brands in the dirt in terms of knowing exactly who their customers are and if their content is reaching the right audience.
Gartner has recently released a report, looking into why large brands are retreating into these closed ecosystems and analysed over 1,100 brands across six industries between Q2 2020 and Q1 2021 to uncover an industry-agnostic view of the top trends taking place across digital advertising today.
The report states that the main reasons marketers are attracted to ‘walled gardens’ is due to ‘their abundance of owned and constantly updated first-party data … and marketers are able to use these advertising tools found on these platforms to deliver and measure targeted, brand-safe ads to users with reduced risk of privacy compliance violations’.
Here, we deliver our top takeaways and how B2B marketers could be affected.
Unique advertising features B2B brands are seeing better returns on their marketing investments by taking full advantage of all the unique characteristics ‘walled garden’ platforms have to offer. Home Depot capitalised on Facebook’s copious abundance of first-party data to target the 90 million (and counting) small business owners on the platform. They used a variety of ads to target contractors and trade professionals to highlight the audience to their job delivery, bulk material pricing and mobile app, increasing traffic to the companies web properties. Cross-selling is made easy Brands can capitalise on the customer data and the behavioural implications it has. For example, Amazon isn’t just an online retail marketplace. The company continues to expand its reach outside of digital commerce into categories such as online video streaming (Twitch, IMDb) and even physical retail (Whole Foods). This gives brands the opportunity to cross-sell between various platforms, each with different places in the customer journey.
There’s a hole in your bucket (and strategy) Before taking the leap to ‘walled gardens’ it’s important to consider whether they are a sustainable strategy. Walled garden strategies may only bloom for a certain amount of time. It’s sensible to keep one eye on politics and ensure that you apply a multi-media mix across walled gardens. The ‘stop hate for profit’ Facebook boycott in 2020 saw major advertisers withdraw spend from the platform, causing many smaller businesses to follow suit. It’s also worth considering that walled garden marketing strategies might wear out over time as they lose effectiveness with the target audience due to an increase in competition. There’s also the issue of focusing on a channel focused strategy, rather than an integrated, cross-channel media strategy. By focusing solely on walled gardens you lose connection with the customer when they’re outside of the garden. For certain campaigns it’s important to be everywhere your customer is, for others, a single walled garden strategy is okay.
The growing importance of data democracy
Effective marketing starts with knowing who your customers are. This includes understanding each prospect across various digital channels. This requires marketers to understand the data on ‘walled garden’ platforms – but is this even possible?
Using platforms such as Facebook and LinkedIn means marketers are forced to make decisions blindly and never truly understand the customer journey.
But in order for marketers to improve and be innovative for future campaigns, as well as controlling the user journey across other platforms outside of the ‘walled gardens’ they must own the rights to their audience data. If it’s not transparent, marketers can’t make these informed decisions – which means they can’t evolve effectively.
Right now, ‘walled gardens’ have the power – this means there is very little momentum for them to democratise their data assets.
There is life outside of these walls…
The majority of user journeys take place outside walled gardens.
OpenX’s survey states that American consumers spend about 66% of their time on the open web – which is defined as any online property, website or app not owned by a major tech company such as Facebook, Amazon or Google, despite those sites only receiving about 40% of digital ad budgets. By only using walled gardens, brands could be missing out on a huge chunk of the customer mindshare.
Within the open web, marketers have access to a broader range of metrics and information, allowing them to understand the results their campaigns are delivering. It is important for marketers to see this opportunity as this will pressurise ‘walled gardens’ to operate in a more transparent way.
The stark truth of platforms and ecosystems for B2B marketing is that there will never be one dominant platform that everyone accepts and leverages. In fact, there will almost always be several segmented platforms across any industry, making it very difficult for B2B brands to operate in a ‘walled garden’ only environment.
Navigating these spaces can be challenging but essentially it all goes back to basics. Making sure your brand is cohesive and effective while constantly thinking about what else your ideal customer wants, where they reside online, and how to diversify from your competition in the shared eco-system that is digital marketing.