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4 Facts you should know about Walled Gardens

Walled_Gardens
28. 03. 2018

Any marketer has stumbled across the term "Walled Gardens". It describes the way large online platforms keep their data to themselves. In particular, the social network giants Facebook and Google are often referred to as "Walled Gardens", because they limit the use of their data by advertisers to their own platforms.

Here are 4 key questions every advertiser should ask about Walled Gardens.

 

WHAT EXACTLY ARE WALLED GARDENS?

In marketing, Walled Gardens refer to platforms that distribute their specific targeting data only in combination with their own inventory, without granting direct access to this data. Their unique selling point is their direct relationship with a large number of users. In this context, Facebook and Google in particular ,are repeatedly criticized for hoarding their data behind "Walled Gardens". Both companies have extremely valuable data that can be used for advertising purposes. However, advertisers cannot compare the performance of their ads on one platform with that on the other.

 

WHY DO THEY EXIST?

When it comes to advertising, huge companies like Facebook hold all the cards. The amount of personal information they have about users, such as age, gender, location, interests and browser behavior, is unprecedented. The data is an enormous strategic advantage for these companies. From their point of view, so far there is no reason to release them.

But closed platforms also offer advantages for the end user, as they enable more precise forecasting and optimization of the available data. No one understands their customers' intentions better than today's major social media platforms. This specific understanding of users' likes and dislikes leads to more appealing news feeds and more relevant ads.

 

WHAT ARE THE LIMITATIONS OF WALLED GARDENS?

One of the biggest challenges of modern digital marketing is the abundance of tools and technologies that offer limited integration capabilities. As an advertiser, it is almost impossible to master the huge number of platforms and reconcile the most diverse success metrics. But this is the only way to determine the marketing investment across all platforms. By keeping campaigns in silos, closed platforms increase complexity even further. This makes performance comparisons more difficult and budget planning a wild conjecture rather than a verifiable decision.

The principle of closed platforms is that the data remains within the platform. Findings from the targeting of Walled Gardens can therefore not be applied to other campaigns. This fragmentation leads to limited optimization possibilities. For example, advertisers know that users who like a particular brand are most likely interested in their own product, but the ability to reach consumers outside the Walled Gardens is often not possible.

 

WHAT WOULD THE INTERNET BE LIKE WITHOUT WALLED GARDENS?

An Internet without Walled Gardens would offer enormous advantages for many advertisers if data from all platforms could be seamlessly integrated. Marketers would gain access to a wider audience and apply intelligent bidding and targeting strategies from one platform globally to maximize optimization. However, it is doubtful that data giants such as Facebook, Twitter or Google will ever make their data completely available for integration into other platforms.

However, there are already existing workarounds, for example via API interfaces. Although it is still not possible to export real data from the platform, they enable at least a kind of communication and integration between two platforms for targeting campaigns and lookalike audiences.  

 

WILL THE WALLS EVER COLLAPSE?

At a press conference in February this year, Facebook reported that work is underway to break open the data silos and that the company is prepared to supply some of its data to neutral third parties. With the help of an independent player, advertisers could then theoretically bring together consumers that react to certain ads on Facebook, Google or other data-rich platforms - and align their strategies and advertising budgets accordingly.

The company said that such theoretical data exchange must be facilitated by a third party. And it would not be willing to take such a step on its own.

 

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