Brand owners will be forking out over €4.1bn (£3.5bn) a year in Europe to help identify customers and prospects while also ensuring compliance with data protection laws, with the market for so-called “identity solutions” set to double by 2024.
That is according to new research from Winterberry Group, which predicts the market – including data, platforms and services – will witness a 17.5% compound annual growth rate (CAGR) from €2.2bn to €4.1bn within the next five years.
The sector is being driven by marketers’ need to pinpoint customers and prospects across multiple devices and other promotional and transactional touchpoints.
Winterberry says that with the total data and data services market now estimated to be worth €17.2bn (£15.5bn) in Europe for 2020, identity-related spend represents 13.0% of that figure for this year.
However, its analysis suggests that as new use cases and solutions are adopted, and the direct mail industry continues to decline to pave the way for a more digital and performance-driven market, identity-related spend will account for 18.4% of the data and data services market by 2024.
Charles Ping, the former DMA chair who joined Winterberry in May as EMEA managing director, said: “In recent years, the identity market has become increasingly complex in how it leverages data, platforms and processes. Our research into the expansion of identity solutions finds rapid growth ahead driven by industry innovation to support marketer performance and consumer engagement.
“As the industry continues to adapt to regulation, it is also becoming more sophisticated across insights, targeting and optimisation. The three primary ecosystems for identity – personalisation on owned digital properties, programmatic and advanced TV (addressable, connected and OTT) – are all expected to experience continued expansion, while enabling consumers to exercise greater control of how their personal data is used.”
Winterberry claims to be the only strategic consulting firm dedicated to advertising, marketing, data, media and technology yet does not provide identity solutions itself.
Its website states: “The marketplace for suppliers has become more complex in recent years. The growth of data-centricity has invited many new providers, and the number of marketing software firms has skyrocketed from a few hundred to thousands just over the last few years. As a result, it’s difficult for suppliers to communicate their value to marketers – and stand out in this fast-changing market.
“We work with advertising and speciality agencies as well as companies in adtech, martech, database service, audience management, business and data management and more to build strategic roadmaps focused on growth and value creation.
“Winterberry Group’s deep understanding of the entire ecosystem of marketers and suppliers provides a unique perspective to help firms identify and act on growth opportunities. We understand marketers’ pain points, constraints and hesitations. We also have deep insight into emerging industry trends along the entire supply chain.”
The company has marketing supplier partnerships with scores of businesses, including Accenture, Acxiom, Adobe, BlueVenn, Cognizant, Epsilon, Equifax, Experian, Harte Hanks, LiveRamp, MeritDirect, Merkle, MRM McCann, Omnicom, SAS, TransUnion and VCCP.
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