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Digital marketers face an ongoing challenge in the form of “walled gardens,” closed online ecosystems where it is difficult to access user data. As we get ready for 2024, it’s more important than ever for marketers to evaluate the current challenges and opportunities surrounding walled gardens and to take stock of the impact of walled gardens in marketing as an industry.
What is a walled garden?
A walled garden is a closed online ecosystem controlled entirely by one tech company. Advertising on these ecosystems is fairly locked down, as major tech companies with walled gardens tend to tightly control access to the user data, content, and advertising that appears within the ecosystems.
Some examples of walled garden ecosystems include Google, Facebook, Amazon, and Apple. These walled gardens have particular advantages, like access to massive user bases and precise targeting within the individual ecosystems. It can also be difficult to reach said audiences outside of the ecosystems, reducing the amount of control you have over your advertising strategies.
Learn more about walled gardens.
Learn the differences between walled gardens and hedged gardens.
Integrated marketing is more important than ever
Today, it’s become more crucial to connect with consumers over multiple touchpoints, which can be done from tech like connected TV (CTV) to websites, mobile devices, and even shopping in a physical store. However, as integrated marketing gains utility, many platforms with walled garden ecosystems have increased, making a truly integrated and personalized marketing strategy more difficult in many situations. As a result, many marketers have realized the value of a more streamlined marketing approach, emphasizing the importance of fully integrated advertising strategies.
Though there are surely marketing advantages to gain from walled garden ecosystems, especially in audience size, the challenges they pose will require you to innovate and find more creative ways to engage with your audience from platform to platform.
Perspectives on walled gardens from Cannes Lions 2023
Offering a poignant view of industry trends and ideas, the Cannes Lions International Festival of Creativity of 2023 had much to say about the significance of walled gardens in the marketing world. Let’s look at two key takeaways from this year’s festival.
Retail media
In recent years, many retail companies have started selling ad space within their own walled garden shopping platforms, dubbed “retail media.” Platforms like Amazon and Walmart have developed their own particular advertising ecosystems where they sell ads to marketers within the shopping environment itself.
Navigating the sell-side of retail media’s walled gardens
While retail media offers marketers unique opportunities, it’s not without its challenges. For one, ad space in these environments is limited, so the competition can be difficult on the sell-side, leading to higher ad costs. Additionally, this shift in dynamic also forces marketers to change how they prioritize their marketing channels, looking closer at the results of their efforts rather than focusing on particular channels within the platforms themselves.
Opportunities in the buy-side of retail media’s walled gardens
Brands on the buy-side see various benefits from advertising within retail media channels and walled gardens. By browsing in an online shopping environment, the users in these ecosystems are likely high-intent shoppers, people who are further down the sales funnel and who are ready to make a purchase soon. Shoppers can also be precisely targeted within these environments, as marketers are given the ability to access very specific audience segments based on details like shopping behavior, preferences, and even purchase history.
Omnichannel marketing
To more effectively engage audiences even among an abundance of walled garden ecosystems, speakers at the 2023 Cannes Lions Festival discussed the importance of omnichannel marketing. By emphasizing strategies that reach the consumer through multiple touchpoints, marketers can deliver a unified brand experience across channels. This allows marketers to focus more on results than specific advertising channels, including walled garden platforms.
Walled gardens aren’t going away in the near future
Though various challenges are associated with walled gardens in advertising, they aren’t going anywhere. So, what’s the current state of these environments throughout the industry?
Efforts are being made to break down walled gardens in tech
In a handful of countries, regulatory actions have been put forward to address how dominant many major tech companies are in their respective markets. One major example of this is Meta and Google’s entanglements in Canada. Currently, neither company can display news on their websites in the Canadian market. This decision was reached to give Canadian news agencies more control over their advertising revenue since, previously, the tech giants received more views and, therefore, gained the ad revenue. Though relatively small, this does indicate a certain shift in dynamic.
Why companies are resisting
Despite their challenges, walled gardens in 2023 persisted, mainly because they are particularly adept at generating revenue for the tech companies that control them. In 2022, 78 percent of global digital advertising revenue came from these closed ecosystems, and projections expect that figure to rise to 83 percent by 2027. From the viewpoint of a company that operates in a walled garden, the idea of releasing their control over their environment represents losing out on a stream of vast revenue, making letting go of a walled garden ecosystem an unattractive prospect.
The future of walled gardens
As time progresses, what can digital marketers like you expect from walled garden ecosystems in the near future?
A cookieless future
A huge element to consider is the transition to a cookieless future. Many major browsers have begun phasing out the use of third-party cookies. In the wake of this decision, many are looking for reasonable alternatives that allow for behavior tracking and more personalized advertising experiences. Solutions like Experian’s identity resolution can provide a strong alternative option, allowing marketing strategies to adapt to the current landscape.
An influx of mini gardens
You should also anticipate the proliferation of various smaller, specialized walled garden ecosystems in the future. These so-called “mini gardens” specialize in more niche audiences and industries, and they can present their own challenges and opportunities.
Alternative IDs
As you search for new identification methods outside cookies, various alternatives have presented themselves, requiring further exploration and experimentation. Among these are privacy-compliant solutions like Unified ID 2.0, which allow you to serve more personalized ads without compromising the consumer’s privacy.
Navigating the evolving landscape of walled gardens in 2024
As we begin 2024, you will continue facing opportunities and challenges regarding walled gardens. The 2023 Cannes Lions International Festival of Creativity re-emphasized how important it is for marketers to stress omnichannel marketing within walled garden environments and become well acquainted with identity resolution solutions as we move into a cookie-less future. All of this requires you to become comfortable with walled gardens being here to stay and innovate to navigate an evolving and developing landscape.
We’re here to help you navigate the evolving landscape of walled gardens in 2024. Contact us today.
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Hashed Email is a privacy-safe digital identifier that can further enrich and expand the functionality and utility of The Tapad Graph with access to Tapad + Experian’s universe of email data. This provides maximum coverage for targeting and measurement when combined with household and individual IDs such as Cookies, MAIDs, CTV IDs, and IP Addresses. Gain back a clearer view Recent data from DMA shows that 51% of people have held the same email address for over 10 years. Email address data by its nature is authenticated and reliable due to its longevity. When leveraging Hashed Email as an extended functionality of The Tapad Graph, we are able to link on average 5 email addresses to each individual, reaching up to 90% of households across the US. Hashed Email expands the customer view by adding new email address identifiers into The Tapad Graph that associate with traditional digital IDs and cookie-less IDs emerging in the marketplace. Reduce fragmentation; and instead of viewing the emails as multiple customers, with Hashed Email they can be viewed as one user profile. When enabled, clients who wouldn’t traditionally have access to first-party customer emails are able to associate and link privacy-safe emails to individuals and their households. Brands and retailers can use Hashed Email to extend these linkages across offline purchases associated with each email; connecting traditional digital identifiers between walled gardens, activation in programmatic media buys, and addressable TV. With the holiday season quickly approaching, access to Hashed Emails will instantly increase scale, connectivity and improve measurement when efficiency, personalization and holistic attribution are pivotal to marketing strategies. Let’s visualize how quickly the customer journey can become fragmented when email addresses that belong to the same person are not associated. Mary has 3 email addresses that she frequently uses. One for social media accounts Email ID 1, one for shopping accounts Email ID 2, and another for work Email ID 3. Mary is a brand loyalist to a top national retailer and whenever there is a new season, there is a high likelihood that she will purchase the latest seasonal decor from that store. She recently did some holiday shopping in-store where she purchased nearly the whole holiday line. Email ID 2 was used to send her a receipt. However, Mary annoyingly receives the store’s ads on Facebook for holiday decor that she had already purchased. This is because the retailer has not yet identified that Email ID 1 and Email ID 2 belong to the same consumer. If the retailer were to leverage Hashed Email, they would be able to identify that both email addresses used belong to Mary. This association connects her multiple email addresses together, enables her offline purchases to sync with her online activity, and helps to determine the most accurate ROAS. Hashed Email is a cookie-free added view into consumer behavior for control over messaging and for measurement. When leveraging it’s possible to report back across all channels and devices in a universal format to know when and how conversions are taking place. Don’t leave valuable data on the table Hashed Email has use cases beyond reducing wasted media impressions. Hashed Email’s full capabilities extend to campaign measurement and attribution modeling. When utilizing The Tapad Graph combined with Hashed Email, know from the first touchpoint to the last where your customers are engaging. But more importantly, know where households and the individuals inside of those households are converting across all of their digital devices, by using traditional digital IDs, cookie-less IDs, and Hashed Email to associate, measure, and correlate online and offline purchases. Imagine what your campaigns could look like this holiday season if you expanded your graph with up to 5 additional IDs per household. This impact could be a game-changer to scale this holiday season. Hashed Email is a reliable cookie-less digital identifier that expands your customer universe that connects online and offline activity while improving the customer experience and reducing wasted media spend. Enabling Hashed Email for the holiday season is not an opportunity that should be passed on. Where do you sign up, you ask? Get started with The Tapad Graph For personalized consultation on the value and benefits of The Tapad Graph for your business, email Sales@tapad.com today!
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