Rival industries eye advertising revenue from customer data

Rival industries
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Engaging, relevant, informative content used to be the gold standard for advertisers seeking to put their sales messages in front of potential customers. But working with non-publishers that have access to huge stores of behavioral data has become increasingly attractive for brand marketers. Here are five rival industries with the first-party data to challenge publishing’s advertising dominance.

  • We wrote earlier this month about the first ever confirmation of the value of Amazon’s rapidly growing ad business. Valued at more than $30 billion, the company’s advertising  operations place it in the top three of global ad sellers with Meta and Google.
  • Amazon noted that a large proportion of overall ad spend is tied to its e-commerce operations, where it captures unrivaled levels of buyer-intent data. Commentators speculated that the surprise announcement was about positioning Amazon as a post third-party cookies powerhouse.
  • Writing for Ad Exchanger’s Sell Sider column, Paul Childs, of mobile ad platform Moloco, says companies other than publishers are looking to get in on the advertising action, arguing that their data is more actionable than other digital ad channels. He says:

Data has never been more plentiful, and the machine learning algorithms and technological infrastructure required to deliver relevant, personalized ads are here.

Rival industries

In his Sell Sider column, Childs took a look at five industries with the customer data to challenge publishing’s claim to be the premier online advertising environment.

Childs says Walmart and Target are trying to win over big brands by arguing that their data is more actionable. Facebook knows what its users like and Google, what they are searching for, but retailers know what products customers are actually browsing for and buying. Using customers’ purchase history, retailers take ad personalisation ‘to a deeper level’.

Online grocery
The growth of online shopping and the data stream that it creates mean grocery stores know a lot about buying behaviours. Childs believes online grocery suppliers are perfectly positioned to upsell or cross-sell related products. Kroger in the US, Carrefour in France and Sainsbury’s in the UK already offer retail media programs to brands inside and outside their regular product ranges.

Food delivery apps more than doubled their revenues in 2020. Instacart launched a self-service advertising program early in the pandemic to allow brands and agencies to run product ads. DoorDash followed in 2021, letting restaurants stand out from regular listings by leveraging data on location, delivery and capacity. Childs says companies in the “people delivery” business, such as Uber and Lyft could also join this group.

Financial services
Banks, credit-card companies and mortgage brokers capture a lot of data about their customers at crucial times in their lives. These life events are some of the most effective predictors of future spending patterns and can enable unprecedented levels of ad personalisation. Childs highlights the Swedish fintech company Klarna and the 2021 launch of its comparison shopping platform.

Travel companies, with their unique understanding of where their customers are located and where they are going, are well positioned to deliver location-based advertising. Childs says airlines, hotels, car rental companies and travel aggregators can all use location data to target ads for local restaurants or entertainment venues.

The lesson for publishers, as always, is to develop your first-party data and your understanding of your audiences.

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