Research from IAB Data Center of Excellence and Data & Marketing Association Shows Largest Share of Budgets for Third-Party Activation Solutions Going to Accuracy and Brand Safety
FOR IMMEDIATE RELEASE – December 4, 2017
Contact: Mike Uehlein, firstname.lastname@example.org
NEW YORK, NY – The IAB Data Center of Excellence and the Data & Marketing Association (DMA) have released “The State of Data 2017,” a study showing that U.S. companies will have spent $10.05 billion on third-party audience data in 2017 for advertising and marketing efforts. However, slightly more – $10.13 billion – will have been spent on third-party solutions to support its activation.
The research, compiled by Winterberry Group and based on an analysis of financial information provided by a range of the nation’s leading commercial data providers, estimates that of the money spent on third-party solutions, $4.3 billion is expected to be spent in 2017 on supporting data integration, processing, and hygiene. These types of services help maximize the accuracy and actionability of audience data, while providing contextual brand safety. Spending on hosting and management solutions is anticipated to hit $4.2 billion by end of the year. Analytics, modeling, and segmentation solutions are expected to take in $1.63 billion.
The study revealed that of the $10.05 billion expected in third-party audience data more was spent on Omnichannel than others, reflecting the value marketers are placing in reaching consumers on multiple devices:
- Omnichannel ($3.53 billion)
- Transactional ($2.99 billion)
- Digital ($2.07 billion)
- Specialty ($0.88 billion)
- Identity ($0.56 billion)
“Audience data is only powerful when you can put it to work, and this research shows that U.S. companies are turning to outside help to tap into that power,” said Orchid Richardson, Vice President and Managing Director, IAB Data Center of Excellence. “These findings must be seen as a call-to-action for more guidance and education across the ecosystem. The IAB Data Center of Excellence is ready to answer the call with an unwavering commitment to working with publishers, brands, and other stakeholders to ensure that they have the skill sets and insights necessary to take full advantage of the audience data they collect and acquire.”
“As customers come to expect a hyper-personalized experience, marketers and advertisers are focused on fully optimizing their third-party audience data, and they’re willing to invest in that optimization,” said Neil O’Keefe, Senior Vice President of Content and Marketing, Data & Marketing Association. “Companies are spending significant sums on services and technology to assist with key data functions—more money than on the data itself. A key challenge to reign in these costs will be stronger budget oversight and increased focus on developing data talent that can rise to the occasion.”
“This research report provides credible, practitioner-informed insights into how U.S. companies are investing in audience data and its associated support functions,” said Jonathan Margulies, Managing Director, Winterberry Group. “It will help practitioners benchmark their own spending against industry norms and establish a firmer basis for future investments.”
“Data has become the fundamental currency in marketing, and it’s no surprise to see it command a significant share of marketer and publisher investment,” said Patrick Dolan, Executive Vice President and COO, IAB. “In a world where old business models are being disrupted by new, audience-centered direct-to-consumer brands, it will be interesting to see how these expenditures grow over time.”
“The modern data and marketing industry is thriving because of customer relationships built on truth, results, and trust,” said Tom Benton, CEO, Data & Marketing Association. “This research demonstrates that modern marketers are strategically investing in solutions to ensure their third-party data is not only ethical and secure, but effective and accurate.”
“The State of Data 2017” was released at the IAB Data Symposium in New York City. Premiere sponsors of the research are Criteo, Deluxe, Epsilon, and Equifax, and LinkedIn is a supporting sponsor. The complete study is available for download at https://thedma.org/marketing-insights/bookstore/state-of-data/.
The Interactive Advertising Bureau (IAB) empowers the media and marketing industries to thrive in the digital economy. Its membership is comprised of more than 650 leading media and technology companies that are responsible for selling, delivering, and optimizing digital advertising or marketing campaigns. The trade group fields critical research on interactive advertising, while also educating brands, agencies, and the wider business community on the importance of digital marketing. In affiliation with the IAB Tech Lab, it develops technical standards and best practices. IAB and the IAB Education Foundation are committed to professional development and elevating the knowledge, skills, expertise, and diversity of the workforce across the industry. Through the work of its public policy office in Washington, D.C., IAB advocates for its members and promotes the value of the interactive advertising industry to legislators and policymakers. Founded in 1996, the IAB is headquartered in New York City and has a San Francisco office.
Founded in 1917 and driving the data and marketing agenda for a full century, the Data & Marketing Association (DMA) champions deeper consumer engagement and business value through the innovative and responsible use of data-driven marketing. DMA’s brand-leading membership is made up of over 1,400 organizations that are today’s innovative tech and data firms, marketers, agencies, service providers and media companies. By representing the entire marketing ecosystem—demand side and supply side—and engaging more than 100,000 industry professionals annually, DMA is uniquely positioned to convene and guide the industry to bring win/win solutions to the market, and ensure that innovative and disruptive marketing technology and techniques can be quickly applied for ROI.
DMA advances the data-driven marketing industry and serves its members through four principal pillars of leadership: advocating for marketers’ ability to responsibly gather and refine detailed data to identify and fulfill customer needs and interests; innovating to bring solutions forward to the data & marketing ecosystem’s most vexing challenges; educating today’s members of the data & marketing ecosystem to grow and lead marketing organizations in the ever-increasing omnichannel world; and connecting industry participants to stay current, learn best practices and gain access to emerging solutions through &THEN – the largest global event for data-driven marketing – and DMA’s portfolio of other live events.
About Winterberry Group
Winterberry Group is a unique strategic consulting firm that supports the growth of advertising, marketing, media, information and technology organizations. Affiliated with Petsky Prunier LLC—a leading investment bank providing merger and acquisition advisory services to companies in the same sectors—the Firm offers its clients strategic perspective that is unparalleled in its addressable industries, while PPLLC maintains exceptional relationships with industry executives and business owners. This combination of market intelligence, research and strategic operating experience provides an educated outside perspective that we bring to each engagement. For more information, please visit www.winterberrygroup.com.