Will The Walled Gardens Turn Clean Room Tech Into Yet Another Platform Plaything?

Most data clean rooms claim to be interoperable, but the largest exceptions. And this leads to confusion.

Independent data clean rooms focus on interoperability, while walled garden advertising platforms care little about interoperability.

And walled-garden-based clean rooms—Google’s Ads Data Hub (ADH), Amazon Marketing Cloud (AMC), and Meta Advanced Analytics—are where the money goes.

Alex Bloore, Senior Director of Products and Data at Goodway Group, said walled garden clean rooms have built-in advantages compared to open clean rooms. Besides having good first party data, Alphabet, Amazon and Meta don’t really need to work together. This means you can focus on your individual business priorities.

For example, the ability to optimize ad spend across Google properties is more valuable than having advertisers and publishers collate data to run clean room campaigns across the web.

The open issues are: Can anyone other than the Big Tech giants win in the clean room category?

big two

Google’s and Amazon’s respective clean room services lead in terms of advertiser and agency mind share.

Both follow similar principles, but take radically different approaches.

Google was the first to release ADH and was the first walled garden platform to do audience targeting via clean rooms. ADH also has many additional features for advertisers, such as a modeled frequency capping tool.

But ADH is also a strange hybrid business for Google. ADH is primarily used by advertisers and agencies, as it is actually part of the Google Cloud Platform (GCP).

The strength and ubiquity of Google’s advertising business makes GCP powerful for account registration. But ADH is so deeply embedded in Google’s advertising business and identity graph that Google can’t open up in the clean room like Amazon.

For example, in October LiveRamp was announced as the first identity partner to sync with ADH. While there are strict guidelines for this integration (which is for measurement purposes only, no viewer inquiries), the partnership is a breakthrough for his LiveRamp, Bloore said. increase.

One week after the LiveRamp/ADH announcement, LiveRamp, Habu and InfoSum signed on as the first clean room vendors to partner with Google PAIR, a clean room style product for third party measurements. And way back in 2021, LiveRamp was the first identity partner to integrate with GCP.

According to Bloore, the bottom line is that Google’s MO is to take a slower approach to ADH. Also, when Google hires a third-party technology company, he works with one or a few vetted partners during a lengthy testing phase.

LiveRamp was also a pilot partner for AWS Clean Rooms, which launched in November. But Bloore says AWS has a more open cloud developer perspective. AWS is generally happy to add additional vendors that customers desire or need. Amazon Advertising priorities are not considered.

“That’s the differentiator at AWS, the philosophy they built their business on,” says Bloore. “I’m not sure you can say that Google has built its business by giving consumers more choice.”

ADH’s day-to-day business is to generate more value from Google’s media and advertising empire. In comparison, AWS is interested in deepening relationships with cloud infrastructure developers and adding queries. This is because it is paid for by the compute load.

Crowded clean room

After Google and Amazon, there is a second tier of clean room operators, clean room revenues are not big, but ambitious and not used to being a “second tier”. Includes Meta, Disney, Roku, and Walmart.

Meta Advanced Analytics is a key component of the overall advertising platform, but Meta doesn’t have a cloud infrastructure business of its own, so it’s not an opportunity for growth.

Advertisers who spend a lot of money on Facebook and Instagram and need more in-depth creative testing can get real value from Advanced Analytics, said Bloore. But the value exists only for marketers who rely heavily on Meta’s platform to reach their customers.

Disney and Roku also fall into the “Tier 2” data clean room category.

They follow in the footsteps of Google and Amazon in that they both launched walled-garden-style clean rooms, but with one big difference. Roku is backed by Snowflake, Disney relies on his InfoSum, Habu and Snowflake.

Disney and Roku’s clean rooms went the third-party route and are limited to narrow use cases. For example, Disney advertisers can use clean room technology to create more accurate frequency caps, but only for Disney-owned media. Still, rather than using Google DSP to force him to create audiences at ADH, advertisers can use his Disney clean room and his The Trade Desk.

And while Google combines YouTube, Maps, and web browsing data, Roku’s Clean Room uses CTV viewer data, walled garden DSP data (formerly dataxu, now Roku OneView), and data from pilot partner Foursquare. Integrate data from

Louqman Parampath, Roku’s vice president of product management, told AdExchanger at the time that data clean rooms are an important service for TV advertising.

For example, an advertiser onboarding data for a large holiday campaign will have a matched audience that can be targeted and analyzed during the course of the campaign. Next year, brands and retailers will have to do the same and get new anonymous match groups.

But within a data clean room, advertisers can retain anonymized audience sets over time to see if the same audience will be more or less receptive the next year, or what kinds of new buyers later turn into loyal customers. You can identify what happened.

As Snowflake’s growth as an advertising and media player shows, there is great demand for hybrid walled garden clean rooms in this category.

There are a mix of other independent clean room providers such as InfoSum, Habu, Optable, and LiveRamp, but Snowflake has significant scale.

Snowflake has invested in Habu and OpenAP, a data clean room provider co-owned by NBCUniversal, Fox, Paramount and Warner Bros. Discovery, with enough traction to continue investing in startups that can piece together as a first-party network I have.

Privacy Pro

But what about privacy? This is one of the main selling points of Data Clean Room.

Snowflake’s ownership of OpenAP and Habu provides potential air cover for sharing and merging data, even if a strategic commercial partnership could theoretically achieve the same goals. This is because for many important media channels (where Apple’s and Google’s advertising data policies apply), privacy is about first-party data ownership, not specific tracking tactics.

A key advantage of platform-based clean rooms compared to open clean room technology is that it paves the way for Google, Amazon, Meta, Roku, and others. It’s not a way to help a third party company track someone else’s customers.

For example, Google tracks users and combines data from Maps, Gmail, Chrome, its advertising network, Search and many other subsidiaries. It is considered kosher. However, when advertisers, major publishers, and a few data or ad tech companies combine data using cloud-based infrastructure providers like Snowflake, the same privacy-preserving technology is put in place and a contract not to publish profiles. Even with the promises above, it is often not possible. go.

The magic of privacy is neither in encryption nor in the extent of unknown users being tracked online. It’s whether the data is held in the hands of his one company.

In that sense, the walled garden clean room is attractive.

To be fair, third-party clean rooms that connect to identity solutions are more private than current systems, says Paul Bannister, Chief Strategy Officer at CafeMedia.

But that argument does not find the support of European regulators.

“Informed consent will be required and the bar the EU will set for informed consent will be so high that it will basically be impossible to obtain,” Bannister said.

When advertisers, publishers, some data companies, and cloud providers (such as Snowflake) partner on clean room analytics, each company requires informed consent from all individuals. It’s hard to scale. But Google does a good job of bundling its services into one identity spine.

“The integration between publishers and DSPs is starting to grow over time,” said Therran Oliphant, senior vice president of data and technology at Essence.

But when advertisers don’t even rely on platform solutions like Google ADH or Amazon Marketing Cloud, going through third-party clean room vendors, DSPs, and even a handful of publishers can be cumbersome.

“Today, it’s resource-intensive and prohibitively expensive to make it work,” said Oliphant.

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