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WPP Division Stakes Claim to Data From Its Online Ads

Group M 'Scares' Media Owners by Stopping the Sharing of Web-Ad Results

By Published on . 2

NEW YORK (AdAge.com) -- When it comes to data ownership, the web is still in the Wild West phase, but WPP Group's media-buying arm, Group M, laid down the law recently by changing the terms of its online-ad deals to the following: "All data generated or collected by the Media Company in performing under this Agreement shall be deemed 'Confidential Information' of Agency/Advertiser."

With that phrase, Group M is making it very clear where it stands on a debate that's been around since the dawn of internet advertising in the mid-'90s: Who owns the data and under what terms? Group M Interaction CEO John Montgomery casts the move, first reported by MediaPost, as standardizing the way business is increasingly being done at the world's largest media-buying firm. "It's to ensure that data is confidential and cannot be accessed by our competitors," Mr. Montgomery said. "It's a loophole we wanted to close."

But publishers contacted by Ad Age said it feels like a power grab by a powerful media-buying agency in the midst of the worst economy in memory. "The broad strokes on this are not acceptable no matter how bad the economy is," said one publisher who has seen the terms. "It's scary."

Group M's move is part of a broader realization in the online-advertising industry that the consumer data being collected by advertisers and publishers is in many cases more valuable than the advertising itself. Why? Each campaign yields important information on who clicks on what and why. The bigger the ad campaign, the more data are generated. Online, the market power resides with those who have the most data and can leverage them.

On the data front, WPP is engaged in a tectonic battle still in the beginning stages. Google and Microsoft both own massive ad networks, behavioral-targeting firms, ad servers and, in Google's case, plenty of data. WPP has an ad server and network in 24/7 Real Media, but it also has something Google and Microsoft don't. Through the four agencies of Group M, it has the largest concentration of ad dollars spent in the online world, which it believes entitles it to the largest share of advertising-derived data.

Price of data
In changing the terms of its standard online agreement, Group M is protecting its clients from having those data used against them in the marketplace. The data generated by, say, an online ad campaign for Toyota can't be used by a publisher or an ad network to target the next Hyundai campaign. But the shift is putting publishers, ad networks and the rest of the online-ad industry on its heels. "Data just got a price on it," said Mike Leo, CEO of online-ad software maker Operative. "It hurts everybody using data, because the ability to build up large chunks of it just became a lot tougher."

Industry insiders said the new Group M standard deal is the way agencies have been moving for some time. Interpublic Group of Cos.' Initiative had been including similar language in online-ad contracts for years, though it failed to create the same stir as behemoth Group M, which had been writing the language into online-ad contracts on an ad hoc basis before making it part of its standard deal.

On each ad deal, there is push-pull among publisher, agency/advertiser and, in some cases, an ad network. And until recently, ad networks helped themselves to data because no one bothered to stop them. "Before, what was happening is that people were collecting data, but no one was using it," said Initiative Exec VP Michael Hayes. "Now people are realizing that it's about the data; that's what's powerful."

Because Group M is the biggest online buyer, it is in a unique position to set standards. And in this economy, publishers that would typically push back on data control have less clout than ever.

Waiting for standards
But the issue of who owns what data is still fuzzy and far from settled. "In the offline world the data economy has rules to it; online, that's not yet the case," said Omar Tawakol, CEO of online-behavioral-data broker BlueKai.

Typically, all parties look to the Interactive Advertising Bureau and the American Association of Advertising Agencies to come up with standards on data ownership and use. But those standards are being negotiated in a committee and are likely still five months away. IAB VP Jeremy Fain said Group M is involved in the effort and its move won't reduce its ability to set industry-wide standards.

Mr. Montgomery said that when it became clear the IAB and 4A's wouldn't complete their work before the end of the year, Group M had to act. "It was becoming impossible to manage all the conversations -- and we were no longer comfortable with the terms," he said.

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