Five Steps To Thriving Amid The Walled Garden Duopoly
With an effective combination of inventory, buying platform, infrastructure and data, these two walled gardens appear to offer everything brands need to reach their audiences. But by spending their entire budget with the duopoly, advertisers enter into an asymmetrical relationship where they have limited control. The non-transparent nature of Google and Facebook leaves advertisers wondering how their valuable data is being used and whether they are inadvertently assisting their competitors.
Here are five steps brands can take to reduce their dependence on the industry giants and regain some control over how their budgets are spent.
Step 1: Understand The Status Quo
Before brands can begin to reduce their reliance on the duopoly, they first need to accept that they are in fact dependent. Advertisers will always need to use Google for search, buy YouTube inventory for video and invest in Facebook for social. And the bigger the brands are, the more they need the walled gardens. Once advertisers accept this situation, they can establish their own objectives and guidelines for how much to engage with the duopoly and can find ways to pull back a little here and there, ultimately reducing dependency.
Step 2: Implement A More Diverse Strategy
Once they have accepted the status quo, the most important step for brands is to revise their approach to inventory buying. Rather than building a strategy with Google and Facebook at the core and then adding other properties to fill the inventory gaps, brands must instead turn the process on its head.
Advertisers should assemble as much high-quality, premium-publisher inventory as possible, at the most reasonable cost. They can then inform Facebook and Google how much budget there is left to capture and let them compete for the win. Brands must get their agencies on board, providing them with clear direction on this strategy and compensating them fairly for the extra work it inevitably requires.
Step 3: Create An Independent Infrastructure
Buying some inventory from Google is unavoidable, but that doesn’t mean advertisers must host on its infrastructure. Ad serving on Google’s platforms gives it access to vast volumes of brand data insight, and using its attribution solutions results in a skewed view of measurement. Instead, advertisers can create their own independent infrastructure using neutral providers and can build and manage their own valuable data assets rather than giving them away.
Step 4: Make Use Of Third-Party Measurement
When advertisers buy from Google and Facebook, they need to make use of third-party verification from an objective measurement and analytics provider; otherwise, the duopoly is effectively marking its own homework. Google has heard the outcry over transparency and invited certain third parties to take part in its measurement program, including brand safety verification with DoubleVerify and IAS and reach measurement with Nielsen, comScore, Kantar and Meetrics.
Equally, Facebook now has partnerships with more than 40 measurement providers in specialties such as marketing mix modeling, viewability, reach and mobile app measurement, so brands must make use of these. While it is positive the duopoly is creating options for third-party measurement, advertisers should be aware the rules are still set by Google and Facebook and could therefore limit a brand’s ability to independently validate ad performance.
Step 5: Band Together With Other Brands
Right now, the industry is so reliant on Google and Facebook that it is overlooking the potential power of collaboration. If advertisers come together, they can combine their buying power and create leverage, working with trade associations and lobbying the government to take action on anti-competitive or unfair practices. Brands can use their agency partners to find like-minded allies and work together to take back some control from the duopoly.
Google and Facebook have a forceful hold on today’s digital advertising industry, meaning brands can’t walk away from them, but they can reduce their dependency. There is an urgent need to start building a more open ecosystem where brands have greater choice and more control. By following these five steps, advertisers can nudge the industry in the right direction while learning to thrive amid the walled garden duopoly.
by John Nardone, CEO
Originally published on Forbes Technology Council