The advertising world is rapidly shifting from a consumer-data-driven business model to a privacy-driven business model. Companies that adapt to this paradigm shift now will be the future winners. Those that do not will suffer steady declines in performance and lose clients.
Advertising that uses consumer data (first or third-party) are likely to experience firsthand the brand implications of not aligning a company’s go-to market strategy with the demands of their clients. Consumers have been clear about this; they don’t want companies using their data for ad targeting.
The advertising industry believes there is a tug-of-war occurring between profits and privacy, where consumer data is the rope. At Inuvo our message is clear: there does not need to be this tug-of-war because this problem has been solved. No need to use third-party cookies as personal identifiers. No need to use consumer data. No need to use IP addresses. No need to purchase stale, suboptimized data.
Discover this future-proof, privacy-first solution, and in the process identify and target the more important reasons WHY consumers do the things they do.
Things To Be Concerned About As Consumer Privacy Reform Accelerates:
The third-party cookie is nothing more than a way to make use of consumer data. The cookie is in effect a technical way to identify a consumer and then append additional information to that consumer so he/she can be targeted. It uses a persistent identifier to accomplish this task. When it goes away, so too does the ability to use consumer data for targeting. It’s the usage of the consumer data, not the cookie, that is at the root of privacy issues. The foundation of all online advertising is based on this consumer data-driven business model, and when it goes away performance will decline dramatically.
We’ve learned that existing technology providers do not have a solution to the forthcoming privacy changes because what is effectively happening in the market is that advertisers and agencies are simply not bidding on ad inventory from these browsers. A large share of the advertising supply is simply ignored and this more than anything else supports the claims that existing vendors are incapable of effectively marketing in a world where there are no cookies with which to onboard and associated consumer data to the marketing decision being made. As an industry, we must stop thinking about how marketing has always been done and now think to how the future of marketing will be done in the era of consumer privacy or we will find ourselves and our clients in the unenviable position of decreasing performance and profits.
Existing AdTech and MarTech companies are advocating that a first-party consumer relationship is an effective solution to the demise of the third-party cookie and IP address. These solutions are nothing other than a consumer data-driven targeting solution hidden behind the smoke screen that because you have first-party consumer data volunteered to you by your customers that this gives you free reign to use that data because the first party cookie will remain in place as privacy issues escalate.
Aside from the reality that this proposal is nothing more than a variation on the exiting method being eliminated, it is a solution doomed to be unscalable and likely to be eliminated as a second step in the ongoing privacy changes certain to be implemented over the next few years. For this solution to scale, you must have a significant number of customers to begin with and share the identities of those consumers with a company that can match them to the sites they are visiting to place ads. The method that will be used to do this matching will be your customers’ personally identifiable email address.
The first challenge will be that this means only websites that capture email addresses as part of their interaction with consumers will be available as a source of ad inventory. The second challenge is that consumers will still be able to delete their first-party cookies, and this means those websites that did capture email will have to ask for that email time and time again, thus annoying your prospects and creating a bad experience for the publisher's viewership. The third challenge is of the hundreds of millions of domains that are currently available for ad placement, these companies that do this matching have only signed up tens of thousands. The fourth challenge is these same matching companies do not have the ability to match all the personally identifiable email addresses you give them nor do consumers often use the same email addresses everywhere.
Put it all together and the conclusion is clear, this is the same old way of using consumer data only it does not scale for prospecting and as a result will not perform.
IP addresses are just an additional way of identifying consumers across device. In the privacy world, it is viewed as personal information because it helps piece together the profile of a consumer including their location. This is necessary in large part because modern marketing is centered around a consumer and that design construct means the identity of the consumer needs to be persistent. i.e. I must be able to figure out who someone is on any device so I can append consumer data to that persistent ID. The IntentKey™, because it is not dependent on consumer identification, the WHO, does not require persistency and therefore does not require IP address.
Privacy legislation in the US is fragmented and unpredictable. There is no one law protecting users against online privacy but instead has a mix of laws for consumer privacy protection to cover all type of data violations. The FTC takes the lead on a federal level followed by a compilation of state level laws. Currently, three states have different yet comprehensive privacy laws (CA, VA & CO), but according to IAPP’s Privacy Tracker the adoption on a state level will only continue to complicate online privacy regulations. Advertisers who have a privacy safe solution will be immune to these changes regardless of the varying state laws. The legislature is not leading the privacy changes, large tech companies are because ultimately, they control the mechanisms through which consumer information gets transmitted. The writing is on the wall with respect to where this leads. Apple has already eliminated the use of consumer data, Google is likely to follow.