As VP of global privacy, Husna Grimes heads up Permutive’s global efforts to lead the publishing and marketing industries into the responsible web. She leads...Read more
Over the past couple of decades, bad data practices have resulted in consumers losing trust in the digital advertising industry.
According to a study conducted by Harris Poll on behalf of Permutive in July, 74% of consumers are concerned about brands being able to view and track their online behaviour to target them with advertising and 75% of consumers would not be comfortable purchasing from a brand that has poor data ethics.
At present, regulators and browsers empower consumers to make more informed decisions about how their data is used in advertising. The big problem for advertisers is that, with more choice, many people are exercising that opportunity to opt out of advertising altogether.
Opt-out Issues
From a regulatory point of view, this issue has been building for years, but it’s now reached a crisis point for digital advertisers.
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In the EU, for example, when users are given the choice to “Reject All” advertising companies handling their data, 55% are already choosing to do so. This impacts all digital advertising and the adtech that supports it, whether targeted via the open web, YouTube, retail media or CTV.
Even the much-discussed and delayed deprecation of third-party cookies on Chrome is an increasingly moot point as only 30% of the open web can be addressed today. You read that correctly: between cookie-blocked environments and users hitting “reject all” or disabling cookies themselves, advertisers are already unable to reach 70% of the open web via third-party cookies.
In recent years, programmatic buying has pushed consumers into the app ecosystem, only for Apple to introduce a tracking opt-out via ATT. In response, 80% of users are opting out of app tracking, negatively impacting ad revenues, including those of tech giants like Meta. Likewise, as email matching on first-party data gained popularity, Apple provided privacy controls via Hide My Email, helping to make ID workarounds unsustainable.
So, what’s next? If more and more consumers choose to put themselves beyond the reach of targeted advertising, how can the digital ad industry survive? What do consumers need to see from brands, publishers and technologies to restore trust in the digital ecosystem?
A Centralised Role
Reduced addressability means the industry needs a new way of buying and selling media — one that puts consumer privacy at the forefront, while still driving revenue for advertisers and publishers. This will require a shift to first-party, consented data.
Publishers have a wealth of first-party data and contextual insights about their audiences.
For advertisers looking to understand who to target, publishers know the interests of their subscribers — e.g. the behaviours they exhibit, how long they spend on their sites, how many times they visit those sites, and how user browsing habits change over time. Publishers are also able to continuously build deeper, more up-to-date profiles on consumers via subscriptions or event registrations. They can even sort them into anonymised “cohorts” for responsible targeting purposes.
A more direct relationship between the buy-side and sell-side of digital advertising will be a crucial element in restoring consumers’ trust.
A 2020 ISBA Programmatic Supply Chain Study revealed that, on average, for 15 advertisers to buy media across 12 publishers, sensitive user information is passed through 300 adtech supply chains. By working more collaboratively with publishers, advertisers can reduce the number of parties involved and decrease the risk of data leaks and further erosion of consumer trust. In this environment, adtech becomes an enabler of this collaboration, rather than an intermediary.
Brands can also combine their first-party data with publishers’ deeper insights and audience cohorts to provide scale and reach while maintaining their relevance to consumers and without compromising their privacy.
Marketing strategies based on consented first-party publisher data will go a long way toward responsible ad spend, particularly during challenging economic times and restoring consumer trust in the digital marketing industry. Now more than ever, advertisers, publishers and adtech providers need to work with — and not against — consumer choice.
