Using a Data Clean Room for Business Growth
Sharing data while adhering to privacy regulations has always been challenging. But by using distributed data clean rooms, it’s now possible to collaborate with data in a secure manner that aligns with privacy rules. The capabilities of distributed data clean rooms are especially beneficial to advertisers and the media industry as we continue moving to a cookieless future. Data clean rooms allow organizations to manage data effectively, deidentify it, and share it. Let’s explore what a data clean room is and how it works, the benefits you can experience with a data clean room, and how today’s companies use data clean rooms for business growth.
What Is a Data Clean Room?
A data clean room is a secure environment that allows multiple companies, or divisions of a single company, to bring data together for joint analysis under defined guidelines and restrictions. These guidelines and regulations keep data usage aligned with privacy laws such as the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA). In the data clean room, personally identifiable information (PII) is anonymized, processed, and stored in a compliant way.
The most popular use case of data clean rooms is to link anonymized marketing and advertising data from multiple parties for attribution. Data clean rooms don’t allow data points that could be tied back to a specific user to leave the environment, giving organizations the ability to adhere to privacy laws.
How does a data clean room work?
Data clean rooms control what data comes in, how the data in the clean room can be joined to other data in the clean room, what types of analytics each party can perform on the data, and what data, if any, can leave.
Any PII data loaded into the clean room is secured and encrypted. The data owner has full control over the clean room, while approved partners can get a feed with anonymized data.
Traditional data clean rooms versus distributed data clean rooms
It’s important to distinguish between traditional data clean rooms and distributed data clean rooms. With traditional data clean rooms, all data is stored in a single physical location, limiting how the data can be shared. With the developments of cloud technology, distributed data clean rooms eliminate the need to move data from one location to another since the data can live in the cloud. This allows each partner to control its own data while enabling governed analytics with other partners, or even with multiple other partners, simultaneously.
Benefits of Distributed Data Clean Rooms
Data clean rooms offer a variety of benefits to advertisers, media companies, and retailers. Here are three of the most significant.
Access to more data while complying with regulations: With the security and access controls that data clean rooms provide, media companies and publishers can provide detailed reporting, and advertisers can track attribution more effectively.
Ability to build custom audiences: Data clean rooms can be used to build custom audiences that can be used on advertising platforms such as Facebook for advertising, allowing marketers to fine-tune their ad targeting.
Advanced analysis: Data clean rooms allow organizations to conduct in-depth analysis on combined data sets to gain insights on customer behavior, segmentation, customer lifetime value, and more.
Use Cases for Data Clean Rooms
Let’s now look at three specific use cases for data clean rooms.
Audience insights for advertising
Suppose a company has its own first-party data containing attributes about its customers and their associated sales SKUs. In that case, the company can use a data clean room to improve audience insights for advertising. Let’s say the company wants to find new customers with the same attributes as its best customers and to combine those attributes with other characteristics to drive upsell opportunities.
To create the target segments and comply with privacy requirements, the company uploads its data into a clean room operated either by it or its ad partner. Participants can securely join any first-party data without exposing IDs. Without a data clean room, only limited amounts of data could flow between the various parties due to data privacy, regulation, and competitive concerns.
Monetizing proprietary data
The omnichannel customer journey is complex, and it rarely starts with a brand’s advertisement. For example, if a consumer is planning an upcoming purchase of a kitchen appliance, the journey is likely to start with online review sites. A reviews site collects top-of-funnel data that would be invaluable to the appliance brand. With a data clean room that manages PII, the site could create a compliant third-party data product.
Data clean rooms allow retailers and consumer packaged goods (CPG) companies to collaborate with brands that advertise with them. For example, a retailer can share transaction data in a privacy- and governance-safe manner to provide insights into conversion signals and enable better targeting, personalization, and attribution.
Real-World Example: NBCUniversal’s Audience Insights Hub
A real-world example of an organization using a data clean room to achieve business growth is Snowflake client NBCUniversal. The company’s Audience Insights Hub, built on a cross-cloud data clean room environment powered by the Snowflake platform, unlocks data interoperability between NBCUniversal and its advertising ecosystem partners. The NBCU Audience Insights Hub enables the following:
Digital audience exploration: Partners can explore how audiences and customers overlap, providing valuable aggregate insights without any underlying data being exposed from either party.
Cross-platform planning: NBCUniversal is combining the new clean room environment with its proprietary Linear TV APIs. This gives partners self-service access to NBCUniversal’s aggregate linear and digital data for cross-platform media planning.
Reach and frequency measurement: The hub incorporates certified reach measurement models, enabling partners to use ad exposure data and conduct their own analyses, providing the ability to deduplicate campaign reach and frequency for more-efficient media planning and measurement.
Cross-platform attribution: NBCUniversal’s interoperable measurement capabilities enable partners to conduct their own self-service multiplatform attribution.
Read more about NBCU’s Audience Insights Hub and learn how it leverages Snowflake’s capabilities.
Snowflake for Data Clean Rooms
To perform analytics more efficiently and in real time and allow for deeper analysis, a company can use Snowflake to securely and privately share data. The participants can then privately “list” the data that would be useful for analysis—in a place where only the right parties can see it—without moving the data out of its database account.
Each participant then can configure access controls, use secure functions, and leverage secure joins to properly protect the data, while still permitting joint data analysis. This can happen immediately if both parties have Snowflake accounts or if a Snowflake customer sets up a secure subaccount for a participant who is not a Snowflake customer.
Learn more about building a data clean room in Snowflake.
Explore how Snowflake can power a data clean room for your organization. See Snowflake’s capabilities for yourself and give it a test drive by signing up for a free trial.