The expected changes to the Australian Privacy Act and the recent announcement by Google that it will finally start to deprecate third-party cookies for one per cent of Chrome users in early 2024, makes it clear that the world of data collection and usage in Australia is set to change – and organisations’ mindsets and plans towards it must also change accordingly.
First-party data is the pot of gold all brands want, and the ability to build quality audiences will become a key priority.
Due to the current macroeconomic landscape and aggressive inflation, organisations are placing more focus on marketing investment that show a ‘real’ return. This will be particularly important when considering that while total advertising expenditure remains strong, market growth has slowed down compared to previous rates according to IAB Australia Online Advertising Expenditure Report.
This bodes well for media owners who already hold these data insights thanks to their direct contact with audiences. They are building substantial, engaged, loyal audiences that they can derive value from in a number of ways.
For brands, it is not quite as simple. To reach the right people with the right message at the right time, access to appropriate media networks is required which is becoming increasingly expensive.
As a result, we are seeing an upswing in brands starting to think and act more like media owners, with these brands considering how they can build relationships with their audience that go beyond a simple vendor-customer model.
When it comes to audience and data insights, the historical divide between brands and media owners is blurring. Here’s how:
The rise of retail media
There has been a lot written about the rise of retail media this year with forward-looking retail organisations already monetising valuable data assets for brands by building out their own advertising networks – retail media networks (RMNs).
Online retailers are collecting more data on shopper behaviour and outcomes than ever before, and they are in a unique position to utilise this data and collaborate with brands who need more effective ways to reach their current and potential customers. This all takes place through RMNs.
Retail media networks empower multiple companies to unlock rich, actionable customer insights, deliver powerful marketing and achieve accurate measurement.
Major retailers like Coles and Woolworths have already made significant headway and they could be set to dominate the entire retail media ad market as they provide unique targeting and attribution solutions for brands. PwC estimated Australia’s retailer media market stood at $850m in 2022, and to have taken $1 billion from the Australian ad market last year, forecasting revenues to hit $2bn by mid-2025 in its central forecast.
Retailers are now exploring ways to offer even richer media experiences, bringing together data from multiple parties and creating expansive ecosystems which also include media companies, tech partners, and brands. To do this, they are using secure data collaboration technologies such as data clean rooms to connect datasets across multiple organisations without requiring any data to be moved, centralised, or commingled.
Analysis of the data allows them to resolve identities across their various data sets, unlocking consumer insights, letting them build and activate high-value audiences and measure the success of those campaigns without risk. Data clean rooms are enabling these activities not only across the retailers’ owned property but also through off-site activations across the media companies’ audiences.
How brands can build their own pot of gold
Alongside these collaborations, brands should be considering how they can build their own first-party data assets at scale. Just as traditional media owners build their audience around compelling and captivating content, so must brands create experiences that resonate and provide value to their audience.
To build and scale an audience, brands first need to build and scale their content creation capabilities. Content marketing is one of the key components of audience growth brands can deploy, but it requires investment. It also requires a coherent strategy, in harmony with all other marketing activities. This is an opportunity to become an educator and a reliable source of information or entertainment that brings an even larger audience to the brand.
For example, sportswear brand Nike has expanded its business empire – and its audience – through content creation. Nike’s Training Club app offers users workout plans, tips, nutrition advice and celebrity interviews and is updated with fresh content daily. Recently, Nike also branched out onto Netflix, launching workout session content on the streaming platform.
Beauty giant L’Oreal also gained traction from branching out into content production. It opened its Content Factory in 2015 to develop creative content across social platforms to encourage engagement with its brands and drive business. Both could now be considered ‘media’ companies, and both have achieved this status through considerable investment.
Ensuring privacy guard-rails
Identifying customers across various devices and channels is essential. But in order to leverage data effectively and comply with incoming privacy regulations, brands must prioritise establishing consent frameworks that empower consumers to control the collection of their data in a transparent and fully consented manner.
Consumers expect privacy and security as top priorities, so it will be vital for brands to foster trusted partnerships and implement robust data collaboration technology and processes. Put simply, data must be safeguarded at any cost. Any audience-building strategy must begin with a careful evaluation of how to extract value from the data and collaborate with partners without compromising customer security or privacy.
The success of retail media should be a source of great inspiration for brands to securely and compliantly build data assets, forging stronger audience connections. By embracing a media owner mindset, brands will be able to enhance audience value and establish ownership within their media properties.
Richard Knott is general manager of ANZ at InfoSum.