In today’s digital landscape, data-driven marketing strategies are essential for businesses to stay competitive. However, as it becomes more difficult to target using 3rd party cookies, walled gardens grow, and consumer privacy concerns rise, companies are finding new technology-driven ways to gain valuable customer insights without compromising privacy.
This is where data clean rooms come in. You may be wondering, what is a clean room? They enable a privacy-safe environment to data enrichment, activation, collaboration and measurement. Data Clean Rooms are a powerful solution for brands seeking to gain deep customer insights, put those insights to work and measure their effectiveness.
But with their growing popularity, there's also a lot of misunderstanding about exactly what a "clean room" is and what it can (or can't) do. To set the record straight on this data-driven solution, here are four common misperceptions about data clean rooms and what those notions get wrong.
Misperception #1: Clean rooms are just another empty database
At first glance, some marketers see clean rooms as nothing more than an empty database they have to fill, and if they don't have a lot of their own data inputs to add, what's the point? Clean rooms don’t solve for a client’s use case needs unless they purchase a data onboarded, an identity and data provider, etc. It just feels like another tech product they don't need that won't actually glean meaningful data and insight. This misperception holds true for most clean rooms—but not all.
A high-quality clean room should be a valuable tool no matter the amount of data a partner initially has and do more than just pseudonymize that data. It's nothing like an empty database and can perform a number of tasks, using whatever data you have available, including:
- Creating custom in-market audiences that can be activated on
- Understanding granular behavioral data
- Maximizing the scale and reach of your campaigns
Epsilon’s clean room offering includes role-based permissions and access controls that allow brands to receive person-level data, rather than just cohort-level data. Other solutions must partner with an ID provider to connect the data in the clean room to their online and offline records that link to activation. At Epsilon, once your data is in our clean room and aligned to our CORE ID, your first-party data will be enriched with our robust profile data and prospect universe of more than 250 million customers. With Epsilon's person-based CORE ID at the center, brands can enrich the quality and breadth of customer and prospect data with exclusive demographic, lifestyle and transaction data that drives more insightful analysis, better activation and accurate measurement
Misperception #2: Clean rooms are so complicated that they are only for data scientists
A complex tech stack can be intimidating to those who don't have extensive backgrounds in data science. While the technology behind clean rooms is sophisticated, the capabilities of this tool have evolved to be low-code or no-code environments that anyone can use. Results are presented through a user interface (UI) that allows for easy interpretation of the data collaboration.
This means data scientists, marketers, strategists and planners have simple access and use of clean rooms.
However, marketers and data scientists may use a clean room differently. Epsilon's clean room has a UI that allows marketers to create segments and audiences with ease, and they can choose from a library of pre-built models. On the other hand, our clean room also has sophisticated analytical capabilities to support the more complex, custom modeling needs of a data scientist. Not all clean rooms offer both sets of capabilities.
Misperception #3: Data clean rooms are just for retailers
Although retailers are commonly known to use clean rooms because of their rich customer data, they aren’t the only ones that can find value from clean rooms. These versatile tools can benefit a wide range of industries, including healthcare, fintech, travel, entertainment, CPG, and restaurants.
In fact, clean rooms are a really valuable tool for industries that have more rigorous data restrictions around marketing, like healthcare or finance. For example, clean rooms allow for safe data collaboration in the public health world without exposing individuals’ private data, which can help pharmaceutical companies and the medical community better serve individuals’ health interests.
Epsilon helped an over-the-counter healthcare brand create ID-based audiences that outperformed broad socio-demographic targeting. By building brand profiles based on health condition survey data and modeling them with Epsilon’s clean room, the brand saw a 60% increase in brand recall, a 32% increase in video completion rate, and a three-fold increase in return on ad spend.
But that's not where it ends. Brands in all industries are looking to clean rooms to activate high-value audiences.
Misperception #4: Your clean room can only match your existing tech stack to work
You don’t need specific platform or the same tech stack as other data collaboration partners to use a data clean room. Your clean room should be flexible, convenient and inter-operable with any partner to collaborate regardless of your existing technology stack. A valuable clean room provider will help you break away from closed systems with limited choice to enable all players to maximize their opportunities.
Your clean room should be inter-operable with any tech stack or solution, but there are efficiencies to aligning your clean room and your activation solution. For example, Epsilon's clean room can activate directly with Epsilon Digital giving you greater media reach without any data loss across the activation. In fact, with Epsilon Digital, we typically find that clients can reach 2-3x more of their customers on the open web through our media activation.
Interested in learning more about data clean rooms? Check out a recent webinar we did with Forrester's Tina Moffett on how clean rooms help brands navigate privacy and transparency in marketing.