Jeff Wood is a guest author. To submit a guest post, go here.
With all of the talk about data in our industry, I’m surprised that so few of the people I talk to in the Local space have a true data strategy — one that gives them real control over their own data and, most importantly, access to this data for decision-making.
It’s the nature of Local that a publisher loses the scale of large network buys. However, you gain the value of a centralized audience. With granular data, a site focused on the hyperlocal market can quickly understand the value of small pockets of inventory, and make educated decisions around how to package and allocate that inventory for sale across appropriate channels.
It’s amazing how many people simply don’t know who owns the data collected on their sites.
Local properties typically have loyal core audiences for certain sections or writers. A detailed understanding of how readers are consuming the advertising on those pages enables better insight into which groups will respond to the ad campaigns running there. Putting sales order, financial, and delivery information together enables sharper analysis and research, which leads to more lucrative results.
Most publishers collect information from users who navigate across their pages. They also gather it via registration processes, and infer it from user interactions with areas of their site, including search terms used and sections visited. Other data comes from advertising metrics, such as delivery numbers, sales, inventory, performance stats and yield information. Most of it is necessary to run a successful business in our highly measurable industry.
Behavioral targeting companies, networks, a data management provider, audience segmentation engines all have the ability to gather data across publisher’s sites. Each of these outside players gathers information from the interactions on the publisher’s site.
In every case, the data is valuable. It enables informed decision-making that drives revenue. Especially in the Local space, the question becomes, “Who is getting the most out of the data — the publisher, or the partners?”
If you have made the decision to utilize third parties for aspects of your business, you should be asking several questions:
Is the data gathered yours? It’s amazing how many people simply don’t know who owns the data collected on their sites. As a publisher, you’re the gatekeeper of all the data on your site. Every agreement you make should clearly define who owns the information.
How much control do you have over the use of that data? You may need third-party technologies to run your site, but that doesn’t mean you need to give these companies unfettered access to your data. With every contract, make sure you outline exactly how each partner may use your data. Determine how well you’re able to correlate first- and third-party data to drive your decision-making. Ensure that third parties are not violating your privacy policies and compromising the trust you have built with your users.
Do you have access to your data once collected? Many publishers are surprised to learn that it costs them money to access data that a third party has gathered from their own business. Some companies even restrict publisher access with parameters. Before signing on, make sure to read the fine print.
Who is accessing and profiting from your data? This is the biggest question to consider when constructing your data strategy. One of our overseas customers earns most of its revenue from sponsorships, and “keyword tags” its articles. This hyperlocal publisher sells a bunch of one-day or one-week sponsorships that take over a section. The publisher is just now getting to the point where it can run analyses of what’s sold on a sponsorship — keyword vs. local-level buy for specific articles. This analysis will maximize the publisher’s net revenue, and will enable the company not only to manage local advertisers and campaigns, but also to integrate and sell them effectively with larger buys and keyword buys.
Third-party data partnerships ought to provide a publisher with some value, whether it’s improved advertising, better analytics or improved yield. Some companies sell or utilize your data in other environments to facilitate media purchases outside of your control. A publisher needs to be aware of everyone who has access to their data. Make sure that the value you receive is worth the access you’re giving to your most valuable asset – your audience.
What impact might it have on your customers if you leak data? It’s scary to think about this, I know, but as a publisher, you need to keep a close watch on the trust you have built with your visitors. Third-party partners rely on tags on your website, and the more tags you have, the greater the chances that some of your data may leak. Monitoring how your partners are using your data is of the utmost importance, because the last thing you want is to have your user data going to black-hat data buyers.
I hope most publishers are asking themselves these questions. For too long, publishers have built the content that draws the audience, but have been unable to monetize this traffic effectively. One of the core reasons for that inability is the lack of a complete data strategy.
We all know it’s necessary to go outside of our walls to find help, but I hope you will take a moment to look under the hood and be sure your partners are empowering your business rather than limiting it. Knowledge is power.
Jeff Wood is the CEO of aiMatch.