What Is a Walled Garden, and What Role Does It Play Within the Adtech Industry?

If you had to guess, what would your definition of a walled garden be? In simplest terms, it can be defined as a garden with high walls. From an adtech perspective though, it’s an organization that keeps its technology and user data to itself without any intention of sharing it. The concept of a walled garden was first introduced by John Malone, and essentially, it’s a closed ecosystem that thrives on its own without the involvement of an outer organization.The role walled gardens play within the adtech space is significant and ever-changing, and there are many benefits to implementing one that may be worth considering.

The Relationship Between Publishers and Walled Gardens

Any service provider and publisher can build their own walled garden. Well-known online journals like The New York Times have their own walled garden where they create a community of users leveraging a subscription funnel. The main idea here is if you want premium content, then you have to pay for it!

Usually, publishers who are influential and have a positive and credible reputation implement walled gardens. This is largely due to publishers gaining more and better control over data while keeping their website monetized. When it comes to new and small publishers though, it becomes a challenge. All in all, if you don’t share your data, it’s highly likely that no one will share their data with you.

Besides publishers, user data for their advertising and marketing campaigns. In order to effectively enable targeting, publishers need to share user data with advertisers, which helps publishers with revenue generation through display ads. However,  a small publisher can implement a walled garden too by creating a niche audience based on audience interests.

Why Are Google, Facebook, and Amazon Dominant In the Ad Market? 

On a similar note, why do you think major companies like Google, Facebook, and Amazon are leaders in the ad market? If your guess is walled gardens, you’re right on target! Google has around 1.5 billion active monthly Gmail users, Facebook has 2.38 billion monthly users, and Amazon pockets one billion user accounts as well. With this kind of vast influence, these corporations can easily gain access to an unlimited number of user accounts. Thus, within this area, walled gardens play a significant role.

Furthermore, it’s important to understand that the best option for small and new businesses is to use cookies, which are unfortunately scheduled for termination in the near future. As a result, many smaller organizations often opt to partner with search engines and social media giants to run their targeted marketing campaigns.

However, what’s worth noting is that both Google and Facebook provide an impeccable ecosystem for marketers by giving them data, centralized audience management, and easy access to their target audience. Marketers have no other option except to spend a large chunk of their marketing budgets on these two platforms.

The Largest Problem of Walled Gardens In Adtech Space

You may wonder what kind of issues do walled gardens have in the adtech space. One of the main problems is that marketers spend more time and money on closed ecosystems, but in turn, they receive an incomplete view of their customers. Unfortunately, there’s no transparency regarding a campaign’s performance.On top of this, walled garden interactions can’t be secured back to an organization’s CRM database, which often results in marketers understanding less about their customers.

At this point, all marketers receive is a collective view about how their campaign performed instead of a customized view that could offer a clearer picture of a user’s needs. Oftentimes, brands receive a blurry perspective of their customers and how to effectively interact with them across various platforms. Currently  though, receiving audience insights from walled gardens is one of the largest challenges for marketers.

Top Benefits of Walled Gardens

Although walled gardens tend to obstruct data and resources, they provide marketers with an array of benefits such as the following:

  1. Accuracy: Facebook first began as a social media platform where people could share information about their personal lives with their loved ones and utilize features including likes and dislikes. Nowadays, marketers can leverage this kind of data to showcase relevant ads to their prospects.
  2. Cross-Device Tracking: A user can access their Gmail and Facebook accounts from multiple devices thus giving marketers the advantage of cross-device targeting.
  3. Security: Even though marketers can run targeted campaigns, walled gardens won’t share data about where different ads appear. Unless a user clicks an ad, an advertiser won’t know who views their ads.

Although various companies like TechTarget, G2, and SWZD are walled gardens, we at True Influence proudly take a different stance. We believe that by only paying attention to a walled garden, brands are missing out on everything else including intent data that comes from numerous sources.

What sets us apart from others in our industry is our valuable and trademarked Relevance Engine, which uses advanced analytics including artificial intelligence and regression analysis in order to analyze web search behaviors and page content identifying intent data. Also, our natural language processing (NLP) algorithm allows for Google-like search capabilities thus making it simple for brands to find appropriate topics for their business.

Moreover, according to a recent eMarketer report, Amazon’s share of the U.S. digital ad market surpassed 10 percent for the first time in 2020. One primary reason for Amazon’s massive growth is because they purchased intent data. Whereas, Google and Facebook understand what users are searching for, what they are consuming, and Amazon knows what they are buying, which is an incredibly important insight for e-commerce sellers.

At the end of the day, if you are a publisher, walled gardens can be a great revenue-generating concept. However, if you are an independent marketer, consider  exploring novel ways to  reach your target audience. What path do you plan to take from here? Will you reap the benefits of walled gardens or continue the educational route before making a decision?

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