Walled Gardens In AdTech- What Do They Mean For Your Business?
In this episode of the If You Market podcast, Sky sat down with the CEO of Postie Company, Dave Fink, and talked about the concept of walled garden marketing versus owned channels and why walled garden channels are becoming more popular with companies looking to grow their brand. In addition, they dive into utilizing marketing technology, branding, SEO, and email to grow your company…
The “walled garden” is a platform owned by a company that controls the content it provides and restricts non-participant applicants from having access to further data. It is a private data space where the owner can auction off access to the audience they have gathered there In these walled garden type platforms, (Google, Facebook, LinkedIn, etc) the companies that own the platform have complete control over the market, ruling over data and resources. Independent companies that want access to these curated marketplaces are stuck dealing with algorithm changes and the whims of a marketplace that is far from open. Dave mentions that “you do not have the freedom over the marketplace yourself” when discussing Google. You are essentially renting traffic on these pre-existing platforms. I was blown away hearing that Facebook and Google take 85% of all ad spend online- but seeing how many major apps and platforms these companies own I guess it isn’t all that surprising…
Moving on, they discuss the good and bad aspects of walled garden marketing, suggesting that the great thing about it is that you can learn to optimize your brand. As mentioned above, Google and Facebook are examples of ‘walled garden’ platforms. If you want to “rent” traffic from them that consists of your ideal target, simply open up your wallet. But what if these platforms start wanting a BIGGER piece of the pie? Something to think about when it comes to our reliance on these platforms. “Never buy a house on rented land” the old saying goes, right?
Dave also mentions the dangers of oversaturation. It has never been easier for your competition to mimic a winning campaign and within a day, the ad that was crushing it for you yesterday is putting you in the hole today. No bueno. My takeaway here is to adapt, adapt, adapt. As marketers we shouldn’t be afraid to change the game plan to keep the ball moving downfield. Also, don’t become too reliant on these marketplaces that you have little to no control over. They are convenient and useful, but having a balance of owned marketing is important for long term stability and success.
When speaking about the mainstream media platforms, such as Instagram and Facebook, Sky mentions, “You do not own the audience.” Does that mean you have no power over your brand on these apps, even if the audience are avid followers of your brand? I don’t think so- I mean if Pepsi tells its followers that there’s a care package at the base of the Eiffel Tower, surely hundreds will go looking for it… But what about the rest of us who don’t have global mega-brands (yet)?
Predictability matters a lot for businesses that take out loans from banks to invest in their brands for growth and efficiency. The brilliance of these ad platforms is that they can create early success for businesses because they are controlled by prepopulated marketplaces. You can easily experiment. If you find something that works you can pump more money into it and scale instantly. As you probably know, when we talk about Instagram and Facebook, they are both marketplaces that are crucial for brands when it comes to advertising and growing a loyal following.
As stated by Dave, these marketplaces allow bidding on ad impressions. It’s great for businesses to create a customer base in the early stages of advertising because of its potential for increased scalability. However, as competition catches on and things become more saturated as mentioned above, it is critical to think about how to adjust accordingly within a timely manner. In that way it can be a bit of an arms race, and the platforms are the arms dealers.
It’s highly advantageous to get on these platforms early and often because it gives you more facetime with your ideal target audience before saturation sets in. In addition, utilizing these platforms could be crucial in walking the line between maintaining existing customers and informing potential new customers about who you are and what your brand is all about. One thing Dave mentioned is what happens when a company that wasn’t on your radar all of a sudden has double your budget because of funding and is targeting the same audience? You better figure out a solution, and quickly because you don’t own the audience and your gracious host is all too eager to sell your next client to your competitor instead!
It’s worth considering that walled garden marketing strategies might wear out over time as they lose effectiveness with the target audience due to an increase in competition. I think it all goes back to the basics- making sure your brand is cohesive and effective while constantly thinking about what else your ideal customer wants, where they reside online, and how to diversify from your competition in the shared eco-system that is digital marketing.