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InContext / An inside look at the business of digital content

Everyone’s talking about ID, but it’s consent that really matters

October 7, 2020 | By Joseph Lospalluto, EVP Americas – Smart AdServer @SmartAdServerEN

After years of intense adtech ecosystem development, we’re moving towards a more mature and controlled market, driven in part by rising concern around the use of personal data. From the privacy laws of Germany and France in the 1970s through to the IAB’s Transparency and Consent Framework (TCF) and GDPR in the EU, the scope of these regulations has grown along with the increasing levels of concern. 

Europe has led the way in implementing privacy regulations in the past. However, citizens everywhere want greater transparency, choice, and control over how their data is used. The waves of privacy are now crashing upon all shores. None of us can continue to operate with our heads buried in the sand. In the US, the floodgates have opened with the implementation of CCPA in California and the upcoming vote to expand it. 

In a 2019 Pew Research Center study, 79% of U.S. adults expressed concern around how companies use the data collected about them. Given that 57% also reported following privacy news very closely, it’s safe to say it won’t be long before the other 49 states follow California’s lead. The key to adapting quickly to current and future regulations without negatively impacting revenue lies in setting a solid foundation based upon respectfully addressing citizen privacy demands.  

The birth of the consent economy

With the introduction of each new set of regulations, it’s clear that we’re shifting towards a new era of consent. As third-party cookies disappear, consent will be required to counterbalance the loss of user ID to continue to target effectively. While most of the industry conversation has been focused on ID alternatives, the real value lies in consent and the power that it carries.

Average publisher revenue is estimated to decline by 52% without access to third-party cookies and expenditures on data management solutions increased by 9.8% last year. However, advertising depends on the delicate balance between the interests of the publisher, the advertiser and the citizen. This new economy aims to maintain the balance of the scales by establishing consent with data as the new currency.

To prevent revenue losses, strengthening relationships with your audiences by integrating privacy into your core operations is key. This, combined with regulation, serves as a catalyst for change. Standard consent permissions clear up confusion and maintain data integrity. Building an informed and fully-consented audience isn’t just the right thing to do, it helps increase the value of your audience.

How publishers regain control 

With the current lack of global industry-wide standards, navigating this stormy sea of tangled regulations can be a challenge. The need to add resources to manage compliance can be a pain point, but it’s clearly important to protect revenue. Choosing the best tech partner can help remove some of this burden from your internal teams and allow for better balance between business needs and regulatory compliance.

Consider the following questions: 

  1. Privacy and consent needs to be at the core of your monetization strategy. Is it currently?
    What consent management platform and framework are you using/adopting?
    Is your platform set up to handle the regions where your traffic originates?
    Are you ready to handle consent from all environments: display, in-app, video, CTV?
  1. Define your data processing and data privacy practices
    What are the practices you and your partners employ?
    What is your provider doing with the data it collects on your assets?
    Does that conform to your strategy and plan and do you trust they have your best interests at heart?

    A publisher’s first party data coupled with consent is their ultimate leverage point. You should protect it at all costs. Adtech companies’ interests must align with the publisher’s. Adtech should be your partner – not your competitor.
  1. How will you and your adtech provider manage opt out traffic? In the consent economy you will not receive 100% opt-in.
    Will your adserver be able to serve non-personalized ads when users have opted-out of sharing their data?
    How can semantic and contextual targeting help you develop valuable audience segments?
  2. Under GDPR you are legally responsible for managing consent choices. Are you clear on the policies and procedures of your adtech partners?
    Can you ensure control over how your audience data and consent is processed throughout every single one of your tech partner platforms? Or, will you be forced to share data at your own risk?

    Get this part wrong risks fines, which have gone into the billions of dollars.  

We are all aware global consumer consent regulations will continue to be adopted/adapted around the world. Being anchored from the start will help you chart the best course through the tides of this new consent economy for the short, medium, and long-term. 

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