Deciphering The Data Clean Room Landscape
The data clean room market is a bit of an anomaly: It’s both an established and emerging market. A vast majority of B2C marketers use data clean rooms: In Forrester’s Q4 B2C Marketing CMO Pulse Survey, 2024, 90% of respondents say they use a data clean room for marketing use cases today. Most use them for marketing measurement, but when looking at other use cases, such as customer analytics or audience segmentation, the market shifts drastically. New entrants have emerged for non-measurement use cases, bringing new optionality for advertisers but also a complicated, highly varied landscape.
A new Forrester report, The Data Clean Room Solutions Landscape, Q4 2024, just published today, providing an overview of 16 vendors and agencies and their primary use cases, functionality, and industry and geographic focuses. There are four flavors of marketing-oriented data clean rooms:
- Measurement applications. Measurement-focused data clean rooms range from traditional walled gardens to media networks that have created their own clean rooms (e.g., Pinterest, Disney, Paramount, and others) and advertising technologies that offer data clean rooms as part of their attribution solution. Measurement is the most established and most common data clean room use case today, and the growth of data clean rooms for measurement will mirror the continued proliferation of walled gardens and commerce media networks.
- Cloud data warehouses. These cloud vendors provide the infrastructure that is foundational to data clean rooms. They have the advantage of already having a foothold in enterprise tech stacks and already storing much of the data that marketers may want to analyze in a clean room. But they are newer to selling to marketing departments. They are playing catch-up on building marketer-friendly tools and interfaces, but they have the resources to gain ground quickly.
- Marketing technologies. Vendors in this bucket focus on activation use cases. Their value proposition centers on enabling marketers to not only explore customer insights but also build audiences and segments and activate them through paid and owned channels. Each vendor’s network of activation and identity partners is critical for realizing that value proposition.
- Agencies. Many agencies offer a managed services approach to data clean rooms — giving marketers the benefits of a data clean room even if they don’t have the necessary data science resources in house. For agencies with proprietary consumer data, the data clean room is a means of letting clients explore consumer insights in a self-service model.
Multiple vendors in the landscape cited vendor-use case misalignment as a top buyer challenge. Before diving into a data clean room short list, marketers must define their use case. Are you looking for granular measurement insights? If yes, is that within a walled garden environment or are you looking for cross-platform/cross-screen measurement? Or are you looking for customer insights with a partner? Or are you looking to build data-driven segments and audiences? Defining your use case will help guide your vendor selection process.
Stay tuned for more research on data clean rooms in the new year. In the meantime, check out the new landscape report and set up a guidance session to chat about your data clean room needs.