Lack of Ownership, First-Party Data, and the Power of Platforms

What is lack of ownership? 

Every so often, a platform engages in audacious actions—altering its terms of use, ousting API partners, restricting its foundational content category, deplatforming figures like Donald Trump, or, conversely, neglecting to do so—and it dawns on us that we are entirely reliant on centralized entities capable of making capricious and unaccountable decisions. 

Certainly, you can fashion your own modest Facebook or Twitter replica if you're determined, but can you construct your own equivalent of Cloudflare? And what about establishing your own payment network? 

Consider a scenario where your company engages in lawful activities within your country, but these actions run afoul of American regulations. If the US chooses to impose sanctions, resulting in local banks severing ties due to their reliance on the dollar, do you have the means to create your own reserve currency? Could you replicate entities like Taiwan Semiconductor Manufacturing Co. or ASML? 

Not to mention, big tech companies change their algorithms all the time.  

If you really think about it, your iPhone is one over-the-air (OTA) update from becoming a brick. In the digital world, we hardly own anything.  

Amazon-Meta Closed Loop 

Sometimes the incumbents succeed in shutting the challenger altogether.  

Look at the Amazon-Meta Closed loop. 

Read this article here and here.

In a recent collaboration, Amazon and Meta, the parent company of Facebook and Instagram, have introduced a new feature enabling users to link their social media accounts to Amazon for seamless in-app shopping. This partnership allows users to make purchases directly through Amazon by clicking on ads within their Facebook and Instagram feeds, eliminating the need to leave the social media apps. The move is part of Meta's strategy to enhance ad revenue, particularly in the aftermath of Apple's iOS privacy changes. The new shopping service is anticipated to benefit both companies, streamlining the shopping experience and providing a significant revenue opportunity. However, questions about revenue sharing and how merchants will choose ad placements within this partnership remain. 

The collaboration between Amazon and Meta, facilitating in-app shopping on Facebook and Instagram, raises concerns about reduced competition. By creating a more integrated shopping experience, users may be less inclined to explore alternative platforms, potentially limiting the competitive landscape. The partnership streamlines the purchasing process and encourages users to stay within the Meta ecosystem, reducing the likelihood of them seeking out other platforms for their online shopping needs. This consolidation of shopping activities within a few major players could contribute to a less competitive market, with users becoming more reliant on a select few platforms for their online purchases. 

Build. 

Technology is driving distribution and you need to own as much of it as possible. Do not rent your customers, but build your own infrastructure to succeed. Do not rent your customers, but build your own infrastructure to succeed.  

The future shall belong to those who shall build and own it as much as feasibly possible.  

It will be your email list, your consumer list, your audience behaviour, your own search for your users, your own integrations and platforms. Your own data, often called, First-Party Data. 

First party data is data that your company has collected directly from your audience, whether customer, site visitors, or social media followers, transactions and clicks. 

First-Party Data is also a Strategic Asset that will improve customer retention, reduce churn, and help you pivot to new products and categories. 

Of course, there is a minimum threshold to this advice but you cannot scale your business beyond a certain point by renting audience from Meta, Amazon, Apple, Google or LinkedIn.  

There is no practical way for you to stop Shopify to change its terms of use and destroy your whole business.

There are things we are doing with Machine Dalal, something that we do for our customers, and something that we think a lot of new age advertising agencies should do. 

Now in this age of #ai, regenerative video, and subsequently regenerative advertisement; the creativity is being outsourced through an #api and APIs almost always cost less than a human.

Platforms makes it easier to reach audience - using whatever algorithm they are shelling.

You can get meaningful, viable, ads from #ai platforms that just need input in a natural language.

And if you are employing platforms to serve ads and you neither own audience data, nor you own the publisher data or have access to anything other than an interface that lets you do stuff, what is to stop another person to come not only eat your lunch but take away your entire means of livelihood.

The threat is more real than we think, ask the newspapers.