In this article…
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.
Latest posts
One of the biggest challenges marketers face when planning digital advertising campaigns is getting an adequate number of impressions that yields measurable results at the lowest possible cost. As agencies, operators and advertisers are increasingly challenged about media budget, it is more important than ever to plan campaigns that generate enough information at the lowest possible cost. Through our design, deployment and measurement of advertising on a variety of platforms, Experian has developed best practices when planning digital advertising campaigns. We share some of these here, to help marketers with future campaign planning to maximize marketing effectiveness at a minimal cost. Using Path to Purchase to Determine the Right Number of Touch Points The Path to Purchase Funnel provides a framework to determine the number of touchpoints required to turn a prospect into a buyer. There are various phases the consumer goes through at each contact, and these phases dictate the number of touch points (or ‘touches’) required to induce a purchase. In the table below, we’ve described what these phases are, and the number of touch points required for those phases. The required number of touches will vary greatly among marketers, who must consider the expected time for a prospect to make decisions, competition in the marketplace, the novelty of the offer, and the level of engagement of the audience. For example, 15-second or 30-second audio and video ads played during scheduled breaks in programming may require more repetition than an ad played at a moment of high engagement, such as when the user interacts with the app, or during a “pre-roll” advertisement view prior to streamed content. Determining the Target Number of Impressions Needed to Persuade The next step involves determining how many exposures will be required to get the impressions or touch points needed to satisfy the consumer’s path to purchase. Let’s say a marketer has decided that four impressions are enough to make the case for the consumer to purchase, and that the marketer plans to reach 1 million prospects during the campaign. Perhaps the most intuitive solution is to provide four impressions for each reached prospect, such that 4 million impressions would be served during the campaign. However, during a normal digital campaign, some prospects will have zero impressions while others will have many. Because of this, we recommend planning to reach a target fraction (typically 80%) of the audience to receive the required number of impressions for purchase. The following table shows the predicted percent of audience exposed by average number of impressions served. Factoring Advertising Half-Life into Impressions Required Advertisement decay, or the fading consumer memory that reduces ad effectiveness, should also be factored into determining the right number of impressions for a successful campaign. For example, if a campaign length is planned to be 6 weeks, but the half-life of the advertisement is only three weeks, then more impressions would be needed to attain the number of touches required for the path to purchase. When planning campaigns for our partners, we adjust the target mean exposure frequency by the square root of the proportion of campaign length over advertisement half-life. For example, assuming a 3-week half-life and a 6-week campaign, we should multiply our target 5.5MM impressions by to get 7.78MM impressions. In the table below, we’ve demonstrated several scenarios of varying advertisement half-life. Other Considerations During Post-Campaign Analysis Once the campaign is completed, Experian recommends analyzing the distribution of impression frequency to determine how closely the actual impression frequencies matched to what was predicted. If frequencies do not align with the predicted, check to see if these assumptions are met: Make sure that advertising impressions are independent of each other. If rules are in place such that a prior impression affects the likelihood of a subsequent impression, this can affect the impression frequency. Check that the entire targeted population is on the ad platform long enough to be available for targeting. Some campaigns may have been instructed to be deployed in phases, which could limit the number of impressions to be delivered. Confirm that exposures can only occur one at a time, so that the impressions are deployed at distinct time intervals, giving the consumer the opportunity to view the advertisement Planning a successful campaign is critical for a test-measure-learn environment for an agency, operator, platform or advertiser. While initial up-front costs can be expensive, the long-term value to the business is significantly greater if tests are designed and administered appropriately. As a result, spending a little extra time thinking about your consumer’s path to purchase, exposure frequency, and the half-life of your advertisement can pay significant dividends in developing your digital advertising strategy.
To our valued customers and partners,It’s been an exciting week here at Tapad! As announced in a press release this morning, Tapad is now a member of the Experian family. We’re thrilled to continue to grow as a leader in identity resolution under the umbrella of a global expert in data, analytics and technology. Tapad and Experian are deeply connected by our commitment to serving the needs of our customers; and with a focus on quality of the data we provide, we have a common goal for the future of identity in the advertising ecosystem. As part of this announcement, we wanted to assure you, our valued customer, that we remain deeply committed to serving you today just as we always have. Nothing will change in your daily operations with Tapad. Experian immediately recognized that the success and growth of Tapad was directly tied to the strength and depth of its team members. As such, the acquisition will not result in any changes to day-to-day contacts at Tapad, or processes with weekly graph deliveries and other product support. Experian’s faith and investment in Tapad’s future and the future of identity resolution underscores what we’ve always believed our products could achieve and that we will be able to continue serving brands, advertisers, publishers, and the advertising and marketing ecosystem for years to come. On a personal note, I am excited to be transitioning my role as Chief Operating Officer of Tapad to the General Manager position of a global business that’s achieved exponential growth over the past several years; culminating in this strategic acquisition that will no doubt bring even more value to our customers in the future. We remain committed to open communication and welcome any questions you may have. Thank you, Mark Connon | General Manager, Tapad
Addressable TV has been through a transformation in the past year. Streaming content has become the most coveted space for creators and advertisers with the rise of new apps and platforms; but the influx of stay-at-home orders around the country have shifted television viewership as we know it, and streaming apps are popping up in droves to take advantage. So, how can you? With no shortage of opportunities to advertise on addressable TV and CTV, how does it fit into the media mix? And furthermore, how can you attribute this household-level device into your overall strategy? Tying it all together Layering addressable TV within digital ad campaigns couldn’t be easier today — but applying the right targeting and cadence between all of your digital efforts; and tying them together in attribution takes the right kind of data. Marketers can use CTV identifiers coupled with other device identifiers available in The Tapad Graph to not only target impressions but also map addressable TVs within the consumer journey; and unify strategies between household decision makers to better personalize messaging. Let's get to work, together At Tapad, we provide actionable insights for marketers to deliver better ad experiences to their consumers through identity resolution. Interested in learning more? Contact us today at sales@tapad.com for a more personal conversation about your identity strategy. 1 The Trade Desk Q2 2020 Earnings Call Transcript, August 2020; 2 iSpot Report, via Deadline, July 2020; 3 Flixed.io, January 2020