Mark Haviland, EVP Global Development and MD of Rakuten Marketing Europe discusses why tech giants Google and Facebook are playing by their own sets of rules
Late last year, Labour minister Chi Onwurah called out tech giant Google and its popular competitors for their lack of transparency. The speech covered their algorithms which control everything from timelines to search results, as well as the issue of "fake news". Onwurah stressed the point that these tech companies cannot expect politicians and the public to simply take their word that the mathematical formulas they use are legal.
Certainly in the marketing world, we are seeing the emergence of a two-tier industry where ad tech giants such as Facebook and Google are effectively able to play by their own set of rules. Last year, Sir Martin Sorrell argued that the solution to these debates should not lie with Facebook or Google. We cannot have the players being the referees, he said, suggesting that the rest of the industry needs to take action.
In order to combat walled gardens and to earn the trust of advertisers, the digital world needs to be increasingly transparent. In December, Facebook admitted to its fourth set of measurement blunders and, whilst advertisers are still not ready to abandon ship, many are now calling for more impartial analytics and accountability.
Changing relationships with advertisers
Exposing skewed reporting will naturally make brands wary of investing in digital and will only have a detrimental effect on their relationship with advertising. In fact, Sorrell made his statement following news that Procter & Gamble would be cutting their investment in targeted Facebook advertising.
Ultimately, the continuation of a two-tier industry will only impede new customers. It could even result in budgets being switched to focus more on traditional channels, such as TV. Audience measurement and TV ratings are provided by the BARB industry standard, giving that sense of transparency advertisers are looking for. With internet adspend amounting to £8.6bn in the UK, it is imperative that marketers are able to effectively assess what they are investing money in. to do this, the industry will need to provide more objective measurement tools.
Three's a crowd
In 2017, the gap between the tech giants and other players in the industry will widen unless all companies work towards third party measurement as the standard.
Now, it is unlikely that a company like Facebook will completely rid itself of its walled garden. For one, having a closed marketplace is a way for Facebook to protect its users' data. However, Facebook has gone to great lengths to be increasingly transparent since its measurement discrepancies came to light. For example, it has assured advertisers that it is assessing its measurement tools to fix previous issues, as well as moving towards more third party measurement.
Companies like Facebook now face a tough decision. Brad Smallwood, VP of Marketing Science at Facebook, described the "metrics situation" as a learning opportunity. He said that "the takeaway for us is to focus on the concept of transparency" and, going forward, this may be what saves the company from losing the trust of advertisers completely.
Technology aiding transparency
Attribution is one technology that can play a role in solving the problem of transparent and accountable measurement for brands working on multichannel campaigns. Traditional last click measurement takes into account only the final marketing channel the consumer interacted with before making a purchase. Now, marketers have the technology to see the influence of a combination of channels - across the entire user journey - on consumers' final decision to buy. The modern journey is complex, taking place across multiple channels, devices, and both online and offline. Brands must have a transparent view of all of their marketing channels, and how they work together throughout the path to purchase, if they are to truly understand the value of their multichannel campaigns.
It is unlikely that walled gardens will completely derail tech giants' places in advertisers' budgets. However, marketers need to be constantly diligent about gaining transparency into their measurement by pushing for third party standards, as well as using technologies that give them a clear, considered view of their spend.