1、INPARTNERSHIPWITH TheStateofData2018 AWinterberryGroupReport|December2018 Acknowledgementsand Aimstohelppractitionersbenchmarktheirowninvestments inlinewithanevolvingmarketplace Anykindofcommercialinformationusedtoidentify consumerandB2Baudiencemembers,asdefinedbyavast rangeofbothstructuredandunstru

2、cturedidentifiersthatmay include: Name,emailaddressand/orpostaladdress IPaddressand/ordeviceID;and Variousdemoandpsychographicattributes,historical behaviorsand/orpreferences Thisinformationmaybeoriginatedofflineoronline,inferred (probabilistic)orexpressed(deterministic)andgeared primarilyforuseinde

3、velopinginsightstosupport(among otherusecases): Planning,strategyandaudiencesegmentation Targetingandexecutionofvariousadvertising,marketingand mediaefforts;and Measurementandattribution WhatIs“TheStateofData”?Whatis“AudienceData”? ResearchMethodology 7 Dozensofindepthinterviewswithseniorlevelmarket

4、ers,aswellaspractitioners representingawiderangeofdata,marketingserviceandtechnologyproviders operatingintheU.S.marketplace(allgearedtoharvestingquantitativeinsightondata expendituresaswellasqualitativefeedbackonthedemandtrendsdrivingthose expenditures) Aggregationofpubliclyavailablefinancialinforma

5、tionondataproductinvestments, publiccompanyrevenuesandassociatedfinancialdynamics Refinementandintegrationofvariousquantitativemodelsgearedtoestimate spendingonthirdpartyU.S.audiencedataanddataactivationsolutions,including thosethatconsider“bottomup”(estimatingthecollectivedatarelatedrevenuesof comm

6、ercialdataandotherservice/technologyproviders)and“topdown”perspectives (consideringdatasproportionateshareoftotalspendacrossarangeofaddressable paidandownedmediachannels) Reconciliationofmodelconclusionswiththoughtleaderfeedbacktosupport findingsthatalignwith“realworld”experiences Indevelopingthefin

7、dings presentedinthisreport, WinterberryGroup undertookanextensivedata collectionandanalysiseffort thatincorporated: TheApproach:SizingtheU.S.AudienceDataMarket 8 Whatsincluded? Spendingondataassetslicensedfromthirdpartyproviders,aswellasservice andtechnologyorientedofferingsthatsupporttheuseofaudie

8、ncedatafor U.S.marketingandadvertisingpurposes,including: Commerciallylicensabledataand/oraudiencesegments,typically correspondingtoactionabledeploymentmedia(includingdirectmail, email,onlinedisplayadvertising,websitecontentoptimization, addressable/connectedTV,etc.);and Anythirdpartysolutionsupport

9、ingthecollection,management, segmentation,analysisand/ordeploymentofaudiencedata Whatsbeingmeasured? AggregateU.S.expendituresonthirdpartyaudiencedataanddataactivation solutionsthatsupportadvertising,marketing,mediasalesandassociatedusecases Whatsnot included? “Insourced”datarelatedinvestments,inclu

10、dingspendingontalentand developmentofhomegrowntechnologies Datarelatedexpendituresthatsupportmarketresearchandotheraggregate insights,ratherthatcampaignorientedmarketing;and Datarelatedexpendituresthataredirectedprincipallytoenterpriseprioritiesother thanadvertising,marketingormedia(mayincludefinanc

11、ialmanagement, regulatorycomplianceandriskmanagement,amongothers) Whatschangedfrom2017? ThisyearsStateofDataanalysisincorporatesawiderangeof structuralimprovementsfromlastyearsinauguraleffort(which, insomecases,haveledtotherecastingofpreviouslypublished estimates).Amongotherchanges,theseinclude: Mer

12、geroftheformer“Integration,processingandhygiene”and“Hostingand management”categoriesintoanewDataManagement,Processingand LocationdataexpenditureshavebeenmovedtotheDigitaldatacategoryfromtheformer Specialtydatacategory,reflectingthegrowingmaturityofthoseassetsandtheir addressableinmarketusecases Brea

13、kingDowntheMarketplaceofThirdPartyAudienceDataandData ActivationSolutionsintheUnitedStates 9 U.S.firmsinvestinawiderangeofthirdpartyaudiencedatatypesandassociateddataactivationsolutions, typicallycorrespondingtotheirassociatedmarketing/mediachannels,usecases,verticalmarketapplications andproviders.F

14、orthepurposesofsimplicity,wehavebundledthesemyriadclassificationsintosevencore categorieswithfivecorrespondingtoaudiencedatatypes,andtwocorrespondingtotheassociatedactivation solutions.Theyinclude: Digital Terrestrial/PII Transactional Specialty/Emergent Identity Typesofdata availablefor licensethro

15、ugh thirdparty providers DataManagement, Processingincludes locationdataaswellasonboardingservicesthatenablethelinkingofofflinedatawithonlineattributes $2.677$3.66636.9% Terrestrial/PII Personallyidentifiableinformation(“PII,”includingname,address,emailaddress)usedtoidentifycustomersand prospectsand

16、indicatewaystoengagewiththem;typicallyforuseacrosstraditional(directmail,offeroptimization) channelsandforcrosschannel/omnichannelmarketingcampaigns $3.530$3.6182.5% Transactional Purchasehistoryassociatedwithaudiencemembers/segments;oftenprovidedinaggregate,usedtodetermineinterests andneedsandusedt

17、osupportsegmentationfortargetedmarketing(includescredit,prescriptionandcooperative datasetsthatsupportmarketing) $2.700$2.7963.5% Specialty/ Emergent Insightsintocustomerandprospectbehavioracrossnewandemergingchannelsandspecialtyfunctionsnoteasily integratedwithotherdatatypes(including“Internetofthi

18、ngs”/wearables,etc.),enablingcustomer/prospectprofile enhancement,segmentationandmarketingengagementplanning;typicallydescribesalternativedatasourcesor enhanceddataproductsthatofferuniqueattributesnotcommontothemarket $0.674$1.01750.9% Identity Informationthatsupportsthereconciliationofcustomerandpr

19、ospectprofilesbuiltacrossarangeofdisparate touchpoints;cansupportdevelopment/enrichmentofprofilesinsupportofcrosschannelmarketingoptimization $0.563$0.84650.3% Total$10.144BB$11.943BB17.7% Morethantwodecadesintoitscommerciallifecycle,onlinedisplaymediacontinuestogrowin excessof20%eachyear.Recently,m

20、uchofthatnewinvestmenthasbeendirectlylinkedtothe emergenceandmaturationofdigitaldatasources,whichhavespurredthedevelopmentofa vasttechnologycenteredecosystemofsolutionsengineeredtoenablemoreefficient placementofmedia(andeffectivetargetingofcontenttodesiredaudiences) Notsurprisingly,dataalsorepresent

21、sasubstantiallylargercomponentofdisplayadvertising budgetsnowinthevicinityof10%to12%ofeverydollarspent,upfromlessthan5%justfive yearsago BehindtheNumbers:WhatsDrivingInvestmentinThirdPartyAudienceData? 12 “Theevolutionofpeoplebasedsegmentationhas madetrueomnichannelareality.Anumberofthe brandswework

22、witharecentralizingtheiraudience strategyaroundtechnologytoprovideasingle sourceoftruthfortheircampaigns” CEO, AudienceManagementPlatformDeveloper “Increasingly,thebuysideisstartingtodelineate betweenthequalityofdataproviders,whichhelps thosewithhighperformingdatasets.Preferred providerrelationships

23、areincreasing.Rightnow, qualityissovaried,andtheabilityofthebuysideto judgethedifferenceislimited,thatdistribution platformsareputtingintheworkthemselvestodo evaluatedataquality” CEOandDMPs,whichmanageanonymousdigitalvisitorindicators)withalongterm viewofestablishingacentral,actionableviewofbothpros

24、pectandcustomeraudiences Morethan90customerdataplatforms(CDPs),forexample,nowcompeteintheU.S.market complementingotheremergentplatformsforshareofmarketersgrowingdatatechnology budgets BehindtheNumbers:WhatsDrivingInvestmentinAudienceDataActivation Solutions? 15 “ThedevelopmentofCDPsoverthelastcouple

25、of yearsisagoodstarttobreakingdowndatasilos, combiningstructuredandunstructureddataandbeing abletocrosspollinatevendordatasets.Butyouneed applicationsontopofthattotranslatedatainto audienceinsights,segmentation,targeting” President,DataDrivenMarketingProvider “Marketingdepartmentsaregettingtheirbudg

26、ets back,buttheyrenotgettingtheirpeopleback,which meansoutsourcedspendondataservicesandthe developmentofmarketinginfrastructureisgrowing” Presidentcertainagenciesandsystems integratorsareinvestingaggressivelyindataintegrationandrelatedservicesoftenwiththeaimof advisingtheCEOandCMOontheimportanceofda

27、tadrivenbusinesstransformationwhileothers, includingsometraditionalmediaagencies,havebeenmarginalizedbythenarrownessoftheirown competenciesandabilitytoevolve BehindtheNumbers:WhatsDrivingInvestmentinAudienceDataActivation Solutions?(Contd) 16 “Brandsaremoreinterestednowinknowingwhere andhowtheirmedi

28、abuysarebeingexecuted.We findourselvesbeingpulledintomoreconversations withbrandsandagenciestomorecloselytrackand analyzethosetransactions” VicePresident,DemandSidePlatform “Offtheshelfaudiencesalesareshrinkinginfavor ofcustomizedaudiences” CEOlawsuitsaimedatmajordataprovidersremainpending oWhileU.S

29、.companiesweregenerallyinsulatedfromthemostdirecteffectsofGDPRspendingonthirdpartydatadidnot materiallydeclineuponimplementationofthenewlawtheregulationhasnonethelesshadamajorimpactondataproviders andusersalike.SomeproviderswereforcedtoeliminateorstreamlinetheiroperationsinEurope,whilevirtuallyallda

30、tausers andprovidershavebeguntoadopthigherstandardswithrespecttodatacollection,consumerprivacy,preferencemanagement anddatatransparency OfmuchlargerconcernintheU.S.aretheCaliforniaConsumerPrivacyAct(CCPA)passedin2018totakeeffectin2020anda hostofstateandfederallevelregulationslikelytofollowinitswake;

31、marketersanddataprovidersarelookingattheeffects ofGDPRasalikelymodelforhowCCPAmayimpacttheavailabilityandactionabilityofaudiencedataintheU.S. Thesenewregulationsaredrivinganexpanded,industrywidefocusondatatransparencyandquality,withagrowingfocus onestablishingclearnewstandardsforthebenefitofconsumer

32、s,aswellasbothmarketersanddatacompilers oFormarketers,theevolvingchallengeisstark:adheretoheightenedstandardswithrespecttodatamanagement,consumer rightsmanagementandsecurityevenasconsumerscometoexpectmoreseamless,personalized,integratedexperiencesthat spantouchpoints(andrelyonbothwidespreadcollectio

33、nandintelligentintegrationofdata) oManyindustrystakeholdersarehopefulthatuniversalstandardswillalsohelpconsumersbetterunderstandandfeelconfident inhowpersonalinformationisbeingusedtoreinforcethevalueexchangeofdataforimprovedcommercialexperiences 17 18 LookingAheadto2019: RegulatoryCompliance,Drivefo

34、r“Customer Centricity”toProvokeNewInvestmentinDataManagement,Governance Amongotherdevelopments,ourpanelofmarketersanddata/solutionproviders saidthefollowingdynamicsarelikelytodefinehowU.S.brandsengagewith audiencedatain2019andbeyond NewTransparencyStandards:Industryleadersandtradeassociationsareresp

35、ondingto theneedfordatatransparencydriveninlargepartbynewregulationbyworkingwith technologyproviders(includingblockchaindevelopers,inparticular)todevelopapplications thatwilltracktheprovenanceofdataandensuregreatersupplychaintransparency ClosertoSolvingAttribution:2019wontyettrulybethe“YearofAttribu

36、tion,”butidentity resolutionismovingthemarketclosertosolvingforthatlongstandingchallenge.While 2018sawmanyinsourcethetaskofmeasurementandattributionfromtheiragencies,2019 and2020arelikelytoseeashiftbacktotheoutsourcingofthesefunctionsnottomedia agencies,buttodataproviders,consultanciesandotherpartne

37、rsthattypicallyenjoya broaderperspectiveondatasroleinsupportingenterpriseobjectives MachineLearningandAIDriveDemandforData:Theincreasedadoptionofmachine learningandAIarelikelytodriveanincreasedappetiteforfirst andthirdpartydatatofeed triggersandrealtimedecisioning.Duetotheblackboxnatureofmachinelear

38、ning processes,thiswillcreatenewcompliancechallengesfortheindustrytosolve IncreasedSpendingonDataManagementandGovernance:ThearrivalofGDPRandCCPA haveelevateddatamanagementandhygiene(alongwithconsumerpreference managementanddatasourcevalidation)to“musthave”investmentprioritiesforall brands,drivingcon

39、tinuedinvestmentinthesefunctionsasenablersofmarketing performance(andhedgesagainstthebusinessrisksassociatedwithnoncompliance) AboutUs WinterberryGroup&IABsDataCenterofExcellence AboutWinterberryGroup 20 WinterberryGroupisauniquemanagementconsultingandresearchfirmthatleveragesacombinationofdeepopera

40、tingexperienceandindustryexpertise intheintersectingdisciplinesofadvertising,marketing,information,technologyandcustomerexperience.HeadquarteredinNewYork,thefirmhelps brands,publishers,marketingserviceproviders,technologydevelopersandinformationcompaniesaswellasthefinancialinvestorswhosupportthese o

41、rganizationsunderstandemergingopportunities,createactionablestrategiesandgrowtheirimpactandvalue.Itsservicesinclude: Businessassessment Strategicplanningandroadmap development BuysideM&Atargetidentificationand qualification Targetcompanyassessment/ commercialduediligence Marketlandscaping Posttransa

42、ctionstrategicroadmapping Integrationplanningandsupport Dataanddigitalbusinessplanningandimpact assessment Dataactivationstrategy Marketingprocessandplatformarchitecture, designandRFPmanagement Marketingorganizationprocessengineering Customresearch Thoughtleadership DATADRIVEN MARKETING TRANSFORMATI

43、ON Additionally,WinterberryGroupisdifferentiatedthroughitsaffiliationwithPetskyPrunierLLC,theleadinginvestmentbankservingthetechnology, media,marketing,ecommerceandhealthcareindustries.Together,thetwofirmsprovideoneofthelargestandmostexperiencedsourcesofstrategic andtransactionalinsightsintheiraddre

44、ssablemarkets. Formoreinformation, MARKET INTELLIGENCE CORPORATE STRATEGY M&ATRANSACTION SUPPORT AboutIABsDataCenterofExcellence 21 TheIABDataCenterofExcellenceisanindependently fundedandstaffedunitwithinIAB,foundedtoenhance existingIABresourcesandtodrivethe“dataagenda”forthe digitalmedia,marketing,

45、andadvertisingindustry.IABDatas missionistodefineboundaries,reducefrictionandincrease valuealongthedatachainforconsumers,marketersand theecosystemthatsupportsthem. Gatheringindustrythoughtleaderstosellthedataagenda Fundingindustryresearchtoprovidebenchmarksandactionable insightsondatamanagementacros

46、splatforms Developingrelevantstandards,service,andbestpractices Creating educationalmaterialsincludingcertification,videos,and webinars Hostingdatafocused eventsthatfeatureindustryluminaries Leadingselfgovernanceinitiativesandprivacysethicsbestpractice Formoreinformation, IABDataCenterofExcellenceBoardMemberCompaniesInclude StrategicPartner