Can telcos become an alternative first-party data ad provider? Novatiq caught up with new Non-Executive Director Charles Butterworth, former CEO of both Vodafone Ireland and Experian UK & EMEA, to talk through the role telcos have in a digital identity built on trust, advertising, privacy and why he thinks Novatiq was right for him.
Why did Novatiq capture your attention?
Overall there were two main reasons that not only were a great match for my two decades of experience as CEO of both a telco (Vodafone) and a data company (Experian) but spoke to what telco data could become and the part it had to play in marketing. I want to see telco data really come to life, and I believe Novatiq is a key part of that.
Why? First off, I believe telcos have a huge opportunity to engage further with their customers in a far more proactive and digital manner. Telcos are sitting on a wealth of data that can be used to create better consumer outcomes by helping to better retain, upgrade, and change customers into product advocates.
I remember projects we ran at the outset of the mobile internet that looked to use consumer data. Whilst we were launching a new proposition in Ireland, we began by looking at who the key influencers were on our network by studying traffic patterns around people who were buying connectivity. What we believed is that if we could engage directly with this group, there were a number of key influencers who could have a disproportionate effect on how we could get the word out. I’ve been fascinated by the way data information flows and how you can use it to generate a specific outcome for years.
Then relatively recently the consumer privacy agenda got a significant boost through the introduction of GDPR. This impacted telcos as well and means that relevant marketing is more challenging unless you are using your own customer data. Before Novatiq that type of opportunity to engage customers was only available through a telco’s owned channels. Now with the dynamic ID, it can be used across open systems safely to give consumers a much better experience aligned with their interests and behaviours, which is very exciting.
Which brings me nicely to my second point – how can telcos use data for other (non-competing) brands to use for their marketing.
I’m a complete advocate of how telcos can use their data to help other businesses, but only in a way that is completely privacy safe. I understand the complex challenge first-hand of how to get relevant information for advertising and targeting in a way that meets GDPR criteria and fully supports consumer privacy, which is and should always be the priority. I wanted to be involved with a data business which starts with the consumer first and works from there.
So it made sense to me that we have this opportunity to work with the telcos who are trying to think about how they can use and monetise data safely, and then how advertisers can benefit from this across the programmatic ecosystem.
What has prevented telcos from adopting before?
I think for a long time concerns around consumer privacy have been high and this has been greatly improved through the legislation and regulation changes which are now providing far greater clarity. Technology is also playing a big part, with the emergence of platform businesses like Novatiq that are set up to help build safe bridges to join the data and the advertising industry. We have seen a dramatic increase in digital programmatic advertising in the last few years, so this platform bridge is one of the final pieces of the jigsaw that can help bring this ecosystem to life and telco data can flow safely with all the right consumer permissions.
Can a telco ad solution compete with the advertising walled gardens?
Absolutely I think they can. Social media companies have a huge advantage against providers of second or third party data as they have a very large set of first-party relationships. What advertisers really need to make this work is alternative very large pools of first-party data, of which there aren’t many. Which is therefore why the telco is so interesting. It has that ability to get that type of scale whilst at the same time having great granularity and accuracy, which are all much coveted by the advertising industry. We can see the restrictions coming to third party cookies which will increasingly take sources of accurate and granular data out of the system, so now is the time to replace it with something even better. I don’t believe the industry wants to see a contraction in choice and partners to work with, hence I am very hopeful that as telcos find ways, with companies like Novatiq, to put their data safely into the advertising ecosystem, the various players will embrace it and find a way to use it appropriately.
How will the role telcos have to play increase with the advent of 5G?
Telcos are constantly investing in connectivity and this means only one thing; that more and more commerce will be traded over mobile. Put another way, with the advancements in mobile networks, telcos can reach more and more consumers digitally and interact with them in real-time. This engagement will help drive consumer awareness and maturity around permissions and consumers will gain more and more confidence that they are in charge of how their data is being used. Finally with this confidence will come, in my opinion, more data sharing and hence the scale of the telco data asset will grow significantly further in the coming months and years.
Back in the 2000s and my days at Vodafone Ireland, we worked out the power that the data held and how we could help consumers and businesses prosper. However the ecosystem was immature but since advertising went digital, I think the wider market now better understands what it really means to put that data power into the hands of the consumer, with all the rightful controls over consent in place. Once a telco has that, they can do really powerful things and Novatiq should be one of the first legs of that journey.
How are telcos best to approach consumer privacy and consent?
I think it’s all about engaging and being clear. Does that mean you are consenting once, or you have to reconsent? How readily can you redact that consent and understand how it is being used? You have to stop worrying about end result when you build these consent models from my experience. You just to should worry about how intuitively clear it is for the consumer so that a consumer can feel they can completely trust what you are doing and you’re giving them the power to accept, refuse or change their minds easily at any point.
That way I think the end result will be fully compliant as I believe that is what the ICO and other regulators are trying to achieve.
How do you think the management of consent is going to change over time?
The management of consent will certainly change over time, but prima facie you have to be able to maintain an active on-going relationship where people can regularly adapt to change, check-in on preference carry through, seamlessly manage their digital lives and protect their data from being moved around and without the ability for reclamation. I think we will see a raft of consent management propositions appearing and some are already in the market. At Novatiq we have built consent into the proposition as a core capability.
What do you predict for Novatiq in the next 3 years?
I hope and believe we can build a strong and viable ecosystem with the telco industry and provide a viable alternative to the dominant first-party data providers that exist today. We’ve got smart people, a great piece of technology with a world-class IP. And the time for this to take off is right now.