For a sector that started out by building customer databases from product registration cards, the edited Electoral Roll and Rotodex files, the data-driven marketing industry has not only shown huge resilience and innovation, there is widespread recognition that these days if your marketing is not based on customer insight you are more of a Triceratops than a trailblazer.
In fact, figures released earlier this year, show data and digital technology-driven companies are still attracting record investment in M&A activity, spearheaded by rampant private equity funds, and accounted for nearly half (47%) of the $87bn (£64bn) worth of deals struck in 2021.
Despite the pandemic, the figures – published in the Ciesco 2021 Global M&A Review and 2022 Outlook – revealed that, worldwide, the total number of transactions jumped 60% to 1,747 in 2021, compared to 1,092 deals in 2020. Within that, the tech, digital, media and marketing sectors witnessed a 60% year-on-year growth in deal volume; 30% stronger than pre-pandemic figures.
Digitisation, data and technology business models also attracted new buy-in from private equity funds, which doubled their number of deals – up 96% – in 2021.
But perhaps the biggest driver of the data industry during the past 12 months has been how traditional channels are now embracing insight and technology to attract new advertisers.
The outdoor industry is a case in point. Once dominated by 96-sheet printed posters, senior advertising professionals now believe that data insights from digital out of home ads are fueling greater campaign creativity and enabling brands to engage with an even more defined audience.
While the DOOH sector suffered more than most during the pandemic, as consumers were forced to stay at home, separate research revealed it is set to shake off the doom and gloom and bounce back to be worth $55bn by 2026.
And one of the key drivers of this growth will be the huge banks of data that are being built from current activity, according research carried out by AI enterprise SaaS platform Alfi among ad professionals across the UK, and overseas.
The direct mail industry is also continuing to defy the doom-mongers, with the global market for mailshot production – excluding media spend – set to be worth $72.67bn (£54bn) in 2022, nearly double that of CRM spend ($42bn), machine learning and analytics ($21bn) and even the Metaverse’s virtual reality ($19bn).
Meanwhile, physical mail continues to drive multi-channel marketing strategies, according to Jicmail, by further expanding its effectiveness at driving online traffic, product and service information gathering online, and record levels of smartphone and tablet usage.
But arguably the biggest opportunity – and one which the likes of Experian, DunnHumby, Nectar, Boots, Acxiom, and TransUnion are grabbing with both hands – is the rise of data-driven TV.
ITV’s revamped streaming service, ITVX, which has launched this month, has already signed a raft of data deals using InfoSum’s technology, which enables companies and advertisers to work together without ever sharing their own first-party data.
Meanwhile, an overhaul of the Planet V addressable ad platform – dubbed Planet V 2.0 – is designed to put more control into buyers’ hands. It allows both advertisers and agencies control over the planning, purchasing and reporting of their campaigns.
Not to be outdone, Channel 4 has signed a deal with Sainsbury’s to boost ad targeting for its own All 4 platform.
It is claimed the partnership, between sales house 4Sales and Nectar360, will enable packaged goods brands to better tailor their activity to All 4 viewers by analysing consumer habits at Sainsbury’s physical and online stores.
McCain, L’Oreal and PepsiCo-owned brands Walkers Baked and Pepsi Max have all agreed to join as ‘test partners’ for the scheme, along with media buying agencies OMD, PHD and Essence, before the initiative is fully rolled out.
However, things are not all going smoothly for the data industry. Controversy still rages over the adtech sector’s use of personal data, with Facebook owner Meta facing a major threat to its advertising model – as well as a mega fine – after European Union privacy regulators ruled its current practice of using terms and conditions to bypass opt-outs of targeted ads, is in breach of GDPR.
The Irish Data Protection Commission – which governs Meta in Europe – initially ruled that the practice did not breach GDPR, but, now the European Data Protection Board has over-ruled this decision.
The board has not ordered Meta to change its practices, however, but has demanded that the Irish DPC issues public orders that reflect the EDPB’s decisions, along with “significant fines”. They are due next month.
By the end of November, the Irish DPC had issued a fourth fine – of €265m (£210m) – against Meta, bringing the regulator’s total penalties against the social media giant to €912m (£786m) in just over 12 months.
Then there is the UK Information Commissioner’s Office action against Experian, dating back to October 2020, when the regulator published the findings of a two-year investigation into the three major credit reference agencies in the UK, Experian, Equifax and TransUnion. It found how the companies were trading, enriching and enhancing people’s personal data without their knowledge.
Equifax and TransUnion agreed to make changes but the ICO ruled that Experian had not gone far enough and slapped it with an enforcement notice, compelling it to make changes within nine months or risk further action.
Experian took the decision to appeal at the First Tier Tribunal, insisting the ruling “goes beyond the legal requirements” of GDPR. That appeal ended more than eight months ago.
Ironically, the outcome is likely to determine whether one of the biggest data companies in the world is also more of a Triceratops than a trailblazer…
Experian lawyers set for long battle against ICO ruling
Meta faces mega fine as ad policy is declared illegal
Channel 4 brings Nectar on board for All 4 ad platform
DunnHumby and Boots strike data deal for ITVX tool
Brands turn to advanced TV but scepticism remains
Brands to spend $5.5bn on advanced TV data solutions
Data insights driving greater creativity in digital outdoor
Direct mail beats off CRM, AI and VR to reach $72.67bn
Data and digital businesses bag record M&A investment