Pablo Martínez Flores
CEO and Co-Founder
Klustera
/
Startup Contributor

Data Must Tell Its Own Stories

By Pablo Martínez | Thu, 03/18/2021 - 09:18

Polanco, 2011. A crowded conference room, packed with digital marketing executives, entrepreneurs, personalities, and a 24-year-old statistician: yours truly.

After a long afternoon of deliberation, we were the elected (as representatives by our coworkers and peers) purveyors of the best campaigns, agencies and advertisers of that good year of our Lord. Entire livelihoods and career destinies were in our jittery, power-tripped hands, as everybody who has — or has not — won an award, knows (I’m being sarcastic). Interest-based media outlets and Wanamaker’s old adage were still kind of relevant (and not yet a truism or cringeworthy), and you had to pay a very hefty price to really reach a lot of people, even if their TV was on mute. It always amused me that decisions involving budgets larger than that of some sovereign nations, were taken upon data from 2,000 houses.

My job was very interesting because I got to watch the old status quo as things changed rapidly: Facebook advertising tools were still at an embryonic stage, and Twitter hadn’t rolled out decent marketing capabilities (have they yet?), but Google was eating everybody’s lunch. As you may not know or remember, dear reader, there was a time when the marketing industry wasn’t captained by Ph.D.s in Mountain View, but by overpaid, high-charging executives in New York and Miami, heirs and simulacra of Don Draper. Programmatic advertising was insignificant compared to deals closed with a handshake.

Google’s data absence from the association’s records in the previous year turned former factual studies into very educated guesswork. They also were syphoning all the senior talent, growing by double-digits every year and disgracing long-cherished traditions, such as the “agency kickback.” Their personnel sometimes struck many as entitled; and how would you not, if the company you are working for is basically printing money? Last week, they made an announcement, and a vow, not to track individual behavior across websites, to not develop a similar technology and to, basically, make third-party cookies a thing of the past.

This is the beginning of an era of extraordinary customer dedication because relationships will have to be cultivated and developed directly by the company, not by-passed through a broker. First-party data, meaning the data for which you personally opt-in with the company, will be key for monetization and growth in 2021.

So, what’s the difference between first- versus third-party data? Starting with the Web on Desktop (very good example), there is a data pool: all the cookies that you delete when you delete the cookies. This pool can be read by data brokers and tools and resold as audiences. That clearly exposes user privacy and generates a messy ecosystem. On the other hand, if you have a direct relationship with the brand, such as in an app, all transacted data stays between you. Look forward to seeing a log-in or finding a lot of (X)s!  We await the next generation of AdTech companies that can leverage the new challenges posed by a web that is evolving around not only expendable users, but of digital citizens with rights and power of choice.

As you might have suspected, there was a cake already baked for this scene: a browser-based technology called Federated Learning of Cohorts. This is one of the most promising alternatives, along with TURTLEDOVE and SPARROW, for the cookie-less future ahead. The mechanism is available via API and gives “95 percent of the ROAS from heavy cookie usage” with a resolution of thousands of user/browsers, the browser acting as a sort of double filter to effectively protect user privacy.

What awaits entrepreneurs navigating walled gardens? AdTech has always been a rough business, ironically as it’s the money pipeline for the whole internet. Decentralization and blockchain pose major alternatives and opportunities for making things differently and retaking control from the dominant players. Initiatives like the BAT and the Brave browser help us start reimagining a future where data hoarding is not possible and instead, we can rely on the power and anonymity of the network itself. Because I have yet to know one single person who gets angry when receiving free stuff and promotions on their birthday — and that’s very PII.