TL;DR: Clean rooms are not a magic panacea or even a business tool – they are an environment. However, when we stop trying to fit a square peg in a round hole, clean rooms reveal their true collaborative value – two or more publishers can enter their audience data to enhance their respective audience profiles and boost inventory value, writes Chris Hogg, Chief Revenue Officer, Lotame.
The clean room hype cycle has entered its next phase. After months of vendors promising that clean rooms are the cure for all the industry’s ailments — from third-party cookie deprecation to digital fragmentation — marketers have now had enough hands-on time to transition from excitement to confusion as expectations now collide with reality.
As James Prudhomme from clean room platform Optable said in his clean rooms explainer, “The Inuit have 50 words for ‘snow’ … The ad tech industry, meanwhile, has 50 definitions of a data clean room, but essentially only one name for all of them.” He goes on to draw a distinction between the so-called clean rooms that exist within walled gardens — which operate in the interests of the tech giants that own them — and independent clean rooms that provide a neutral, collaborative, privacy-compliant data-sharing environment.
Not long ago, Customer Data Platforms (CDPs) went through a remarkably similar cycle, and work is ongoing to salvage their reputation. The CDP Institute was formed to separate the wheat from the chaff by certifying legitimate CDPs that perform the functions customers expect. This may seem like overkill but it’s very much necessary: just this year, Forrester found that only 10% of CDP owners feel the product meets their needs.
For clean rooms to avoid a similar fate, we need to cut through the confusion and clarify what they can do, what they can’t, and clear out the snake oil merchants from the market.
Clean rooms are not a panacea
The most important thing to understand about clean rooms is that they are an environment, not a tool. On its own, a clean room is like an empty dinner table waiting for guests. If multiple people show up, each with their own dish, that dinner table becomes a party with everyone sharing and learning from each other’s recipes. But if only one guest brings food, there won’t be enough for everyone to eat, or if the food is terrible, everyone will leave unhappy.
So, what should someone bring to the clean room table? Firstly, the data needs to be in a usable state. That means any parameters that are intended to be compared need to be established beforehand, along with any ID solutions that are going to be used to track individuals, customer journeys, or audience segments across data sets. The “clean” in clean rooms refers to the scrubbing of personally identifiable information or any sensitive data that participants don’t want surfaced; they do not “clean” bad data. As always: garbage in, garbage out.
What this all means is that in order for a clean room to serve as a replacement for the cross-channel tracking capabilities of third-party cookies — as they are often positioned — all parties need to already have the data at hand to follow customers or audiences from one location to another. This is great for organizations who have worked on gathering and activating their first-party data, but a clean room can’t connect the dots if half the dots are missing.
When we stop trying to fit a square peg in a round hole, clean rooms reveal their true collaborative value. Two or more publishers can enter their audience data to enhance their respective audience profiles and boost inventory value; an e-commerce site and a publisher can track customer journeys and gauge the success of referral programs; an advertiser and a publisher can match their data sets to more accurately target users — the possibilities are limitless and exciting.
The muddy waters of the clean room market
We’ve established that clean rooms are only as good as the data fed into them, which also means that those with the most data have the most bargaining power. Media giants such as Google have been quick to take advantage, with its Ads Data Hub serving as yet another way for it to hoover yet more data into its walled garden under the guise of providing a clean room. Collaboration — the purpose of a clean room — is difficult to spot here, as the enormous gulf in power means that all exchanges are carried out strictly on Google’s terms.
With so many clean rooms (or platforms posing as clean rooms) on the market, interoperability is also a challenge. Data compatible with one clean room may not be compatible with another, multiplying the data-wrangling work required each time a partner introduces a new clean room into the mix. Some vendors are keen to “lock in” customers to their platforms, ultimately limiting the collaborative potential of the technology. Solving the interoperability challenge will likely require industry-level initiatives to ensure organizations can quickly get set up in clean rooms regardless of vendor.
It seems likely that we will eventually need a ‘Clean Rooms Institute’ in the style of the CDP Institute to (no pun intended) clean up clean rooms. Until then, the onus is on legitimate clean room vendors to highlight the intended use cases of the technology and speak out against the trend of any privacy-compliant data platform claiming the clean room title.
Chief Revenue Officer, Lotame
Lotame delivers flexible data solutions to future-proof connectivity and drive performance across all screens. Marketers, publishers, and platforms rely on our innovative and interoperable solutions, powered by our identity platform, to onboard, enrich, and address audiences. Lotame is headquartered in the United States and serves global clients in North America, Latin America, Europe, Middle East, Africa, and Asia Pacific.