In October, The Guardian’s Chief Revenue Officer revealed that numerous ad tech providers in the ad supply chain were extracting up to 70% of advertisers’ money without quantifying the value to the brand. Yes, this revenue loss situation is eye opening, but it’s not the only activity affecting publishers’ bottom line. Protecting data assets is critical for maintaining and maximizing revenue. Inability to control digital audience data within the supply chain is a catalyst for revenue loss. The looming General Data Protection Regulation (GDPR) regulations, that take effect in May 2018, makes the case for data protection that much stronger.
Data: a Publisher’s lifeblood
Every digital publisher intrinsically knows that one of their most valuable assets is their audience data: It drives a publisher’s stickiness with lucrative advertisers, their inventory value, and ultimately their brand image.
Data leakage is the unauthorized transfer of information from one entity to another. In the digital ad ecosystem, data loss traditionally occurred when a brand or marketing agency collected publishers’ audience data and reused it without authorization. Today, this scenario is much more convoluted due to the volume of players in the digital advertising landscape, causing data loss to steadily permeate the entire digital ad industry.
Publishers lose when they can’t control their valuable consumer data:
- Depleted market share
With your audience data in their hands, advertisers and ad tech providers can always go to other publications and target the exact audiences, thereby devaluing your brand.
- Reduced ad pricing
When advertisers or ad tech providers can purchase your audience at a fraction of the cost it decreases the demand for your ads, thus devaluing your ad prices.
- Exposure to regulatory penalties & risk mitigation
Collection and use of consumer data is a publisher’s prerogative, but protection of this data is a weighty responsibility. Inability to safeguard data gathered from your website leaves a publisher vulnerable to running afoul of government regulations. Saying the penalties under GDPR are severe is an understatement. The repercussion of noncompliance is losing up to 4% of your total global turnover or €20 million, whichever is greater.
- Reputation loss
Ultimately, data loss and any news of noncompliance could negatively affect consumer trust and brand reputation.
The hands behind data loss
On average, The Media Trust detects at least 10 parties contributing to the execution or delivery of a single digital ad, and this is a conservative figure considering that frequently this number is as high as 30, and at times more than 100, depending on the size of the campaign, type of ad, and so forth. The contributing parties are typically DSPs, SSPs, Ad Exchanges, Trading Desks, DMPs, CDNs and other middlemen who actively participate in the delivery of the ad as it traverses from advertiser to publisher. Any upstream player, including the advertiser or original buyer, has access to a publisher’s proprietary audience data if not monitored for compliance.
The advertising ecosystem isn’t the only offender. The bulk of third-party vendor code that executes on the publisher’s website goes unmonitored, exposing the publisher to excessive and unauthorized data collection. In these cases, a publisher’s own website acts as a sieve leaking audience data into the digital ecosystem.
Ending the chase
Resolving revenue lost from data leakage isn’t an unsolvable conundrum, but one that can be addressed by applying the following:
- Data Collection
Get smart about the tools used for assuring clean ads and content. Your solution provider for ad quality should check for ad security, quality, performance and help with data protection. Reducing excessive data collection is the first step in addressing data leakage.
- Data Access
With GDPR, EU-US Privacy Shield, and many more such timely regulations, the onus is on the publisher to understand what data activity their upstream partners engage in via advertising. Instead of today’s rampant mistrust, the supply chain must move to accountability for non-compliant behavior.
Publishers absolutely need to start adopting and enforcing stricter terms and conditions around data collection and data use.
Ultimately, every publisher needs to monitor and govern third-party partners on their website to close loopholes that facilitate data leakage before pointing fingers at others.
Matt O’Neill currently works with The Media Trust as European General Manager. Since 1999, Matt has been working on the front line of digital advertising in an industry-facing capacity, consistently striving to generate industry consensus from senior leaders and drive innovation through collaboration. He is a frequent speaker, panelist, and chair at conferences including Digiday, IAB, dmexco, AOP (UK), Admangerforum, AdMonsters and corporate-operated events. He serves as an adviser and investor for advertising and marketing technology firms and an active partner at AtlanticLeap.