As a Digital Marketing Strategist, I am often asked what the most concerning issue facing the Digital Marketing industry is. To be completely honest, that’s a really tricky question.
The first thing that comes to mind is Data Privacy and related issues such as those exposed in the Facebook / Cambridge Analytica scandal of 2018 (HERE is a great article by The Guardian on Cambridge Analytica). But when it comes to issues facing small businesses in both large and regional cities across Australia, the one thing that continues to cause me great concern not only as a Marketer but also as a Business Strategist is the lack of transparency from Marketing Agencies in relation to how they manage consumer data on behalf of their clients. Before we dive into these issues, it’s worth taking the time to summarise the role of consumer data in modern marketing strategies.
“Half the money I spend on advertising is wasted; the trouble is I don’t know which half”. – John Wanamaker (1838-1922)
There was a time when advertising was a binary game. A business would disseminate their marketing message and the outcome of that effort would be one of two options – success or failure. As famous U.S. merchant John Wanamaker (1838-1922) once said, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half”. There wasn’t much information contained within the results of early marketing endeavours. Fast forward a century or so and the situation remained fairly unchanged until the emergence of digital forms of advertising on the back of the internet revolution. The advertising industry was about to experience a dramatic shift away from binary outcomes with the introduction of dynamic and complex data feedback from each campaign. This initially focused on logging the consumer’s basic Demographic data.
When I began my journey as a Marketer in 2005, the first advertising platform I used was called “AdWords” and was created by a small company known as “Google”. This platform was of course already an advertising industry Behemoth at that time, generating over $6Billion in advertising revenue that year alone. When I ran my first campaign in Google AdWords in 2005 I was not presented with the binary outcomes of success or failure, I was instead gifted a trove of valuable data on the consumers I had advertised to, regardless of the fact that nearly none of these people had interacted with my ads or had any dealings with my business whatsoever. While not able to provide me with details such as name, phone number or home address, Google’s system provided enough Demographic data (age, gender, city etc.) for a 50-page report on those who saw my ads, clicked on my ads, visited my website, and (of course) those who did in fact completed a transaction with our business as a result of my ads. Fast forward again another decade and the Digital Marketing industry saw the rise of Psychographic data from consumers thanks to another small business called “Facebook”. Facebook’s platform encouraged its users to provide information on which books, films, music they liked. Facebook tracked everything that each user did on their platform, who they communicated with, what they spoke about, which organisations they were interested in etc. That is what Psychographic data is all about – Interests. Suddenly Marketers were able to target people with ads based on what their interests were. Fast forward again to 2020 and the industry has moved again towards a new frontier – tracking behavior of consumers to infer interests rather than just relying on the explicit communication of these interests by the consumer to an organisation like Facebook. Modern behavioural tracking is often centred around a business’ website and the content contained therein.
So what’s the relationship between this consumer data and a business’ Marketing partner? There are two types of Marketers in this world – those that aim to provide effective marketing solutions to their clients and those who retain as much data as possible to strengthen their position over their clients. This ethical dilemma is one that most business owners are not even aware of. They engage a marketing partner, the partner runs ads for the business, the business gets results or doesn’t, and the business is given the option of continuing to work with the partner or to discontinue. This seems simple enough until you consider how a business owner would make that decision. A call needs to be made of the efficacy of the marketing efforts by the partner organisation to determine whether or not it is in the best interest of the business to continue or cease the partnership arrangement. If the marketing partner is taking an ethical approach to the business relationship and acting in good faith then they acknowledge that the business owns the consumer data from their ads and provides unlimited access to this data. This would provide the business owner with all the information required to determine the performance of their marketing partner and make a call on the next steps. On the other hand, if the marketing partner runs all ads from their privately owned ad accounts (whether it be on Google Ads, Facebook, Instagram, Linkedin etc.) which the business has no direct access to, then they are denied not only what is rightfully theirs but they also are denied the ability to effectively determine the performance of their marketing partner. Trust is an essential ingredient to any relationship but this concept works both ways. If a business is expected to trust that their marketing partner is performing as expected without having to hand over all of the consumer data they are capturing on behalf of a client, then the shouldn’t the marketing partner also trust their client enough to give them full, unrestricted access to the systems that contains the consumer data relevant to the business’ ads and activity. My professional opinion is.. absolutely. As previously stated, there are two types of Marketers in this world – those that are transparent and those that have something to hide.
Why does this form of data transparency matter to a business. I’ve worked with hundreds of businesses in my career and (other than start ups) almost all have run advertising campaigns in the past which carry with them large amounts of data on what worked, what didn’t, what was most cost-effective, which offerings resonated with which market segments etc. Do you know what response I get from business owners when I ask them what they know about their market or the strong and weak points within their previous marketing efforts? They are almost always without any firm data to support their thoughts and opinions on the matter. Despite often having spent thousands or tens of thousands of dollars running ads, these businesses were never provided with access to the hundreds of thousands of dollars worth of consumer data their money generated. Why is this the case? Knowledge is power.
Believe it or not, not all businesses have their clients/customers best interests at heart. This is going to blow some people’s minds but some other businesses only care about how they can extract the most revenue from their clients. The advertising industry is no different to any other industry in this sense. Some Marketers’ objective is to generate the best outcomes for their clients’ businesses and will provide all information that may help drive towards this outcome. Other Marketers’ objective is to create an environment where their clients need their services because they risk losing any access to the consumer data they have invested heavily to generate should they cease dealing with that particular partner. Don’t despair, even if you don’t currently have access to your own consumer data you may still be able to gain access. Ask your marketing partner to provide access to the ad accounts they are running your ads from. When they say they can’t give you access (likely due to other clients data also being contained therein) then request to have them launch new campaigns from an ad account that the business owns directly and then provide the marketing partner with access permissions from the business. It’s okay if they refuse this request. Now your business at least has the information required to make that call on the ongoing relationship. Do we want to continue investing in building your marketing partner’s business with your own consumer data or do you want to begin to take ownership of your own business assets (namely your consumer data) to help grow the value of your own business? There are two types of business owners in the world – those who pay to grow other’s business at the expense of their own and those who understand that (as of 2017) the world’s most valuable commodity is no longer oil, its consumer data. If your business has full access to and owns its own consumer data then good for you! If not, ask your marketing partner “Why not!?”.
About the Author
Lawrence Fox is the Head of Strategy at M2F. Lawrence is a Strategist specialising in Performance-based Marketing and Data Analytics. Lawrence has previously managed digital marketing projects and campaigns for some of the largest businesses in Australia including Medibank, Roadshow Films, Qantas, Novotel, Specsavers, and Holden (Aus & NZ).
Marketing Strategy, branding, website development, and digital campaign management across Facebook, Instagram, Messenger, and Google marketing platforms (incl. YouTube).