Category results for "Supporter Spotlight"

Why third-party cookies should be dead to you (regardless of what Chrome does)

July 8, 2021 Valbona Gjini, Marketing Director – ID5

On June 24, Chrome shook the industry once again by announcing it will delay the deprecation of the third-party cookie, which was expected to be in 2022. When the news broke, many industry players gave a sigh of relief. The two-year time frame to migrate to a cookie-less infrastructure was quite tight for many. And not all companies were prepared to buy and sell data and inventory without the good old third-party cookie.

Transitioning a multi-billion-dollar industry to a new framework is not a trivial matter. This is keenly felt in a highly interconnected ecosystem like digital advertising. However, it’s a crucial step that we all must take. The cookie-based infrastructure has been called into question by data privacy regulations, such as GDPR. It is also inefficient.

The many limits of third-party cookies

Third-party cookies are domain-specific and can only be read by the server that created them. Technology platforms need to synchronize IDs with each other to create a common reference and share user-level information. This process, also known as cookie matching, takes place on advertiser and publisher websites. Significantly, this creates several issues:

Value loss: the pool of identifiable users is reduced by 10-20% each time platforms match IDs with each other, creating lost opportunities for publishers to monetize their assets and for advertisers to reach their audiences.
Privacy compliance: cookie matching represents an exchange of personal data. This is difficult to align with the requirements of data protection regulations such as GDPR and CCPA in terms of control and transparency.
Data leakage: because of cookie matching, user data can be accessed by companies that lack a business relationships with advertisers and publishers. This puts their data at risk.

In November 2019, ID5 commissioned a study to assess the scale of the problem. The study, conducted on 68 top news and magazine websites in Europe, found that 58% of vendors that were registered with the IAB TCF had never been seen to take a GDPR consent parameter in their pixel.

Some vendors that were not being sent the consent string were sharing a completely fabricated consent string. The study also found that some of the companies triggered to monetize publisher-branded segments on their sites had no relationship or contract with publishers.

Therefore, we must transition to a cookie-less infrastructure to operate more efficiently and protect consumers’ data. And yes, that’s regardless of what Chrome decides to do with cookies.

Two of the major browsers have already deprecated cookies

The cookie matching process is far from being efficient or privacy-compliant but it still enables user identification which allows the deployment of campaign strategies such as targeting, retargeting, frequency capping and measurement. However, let’s not forget that cookies are already not available on 30+% of the traffic since they have already been blocked by Safari and Firefox. So those valuable campaign strategies cannot be applied in those browsers. That’s the main reason why cookie-less traffic is massively under-monetized. A study by Google estimated that the ability to identify users accounts for 50 to 60% of publishers’ ad revenue. Another study conducted by Bidswitch shows that eCPMs are 50% lower on Safari and Firefox.

Furthermore, Publishers’ first-party data loses its value in cookie-less browsers. First-party data belongs to the domain that has collected it. To activate it and power retargeting or prospecting campaigns, media owners need to find a way to share it with their monetization partners. This has been historically done with third-party cookies. In browsers where cookies are blocked, first-party data sharing represents a challenge.

By adopting solutions that enable privacy-compliant identification without relying on third-party cookies, publishers can benefit from all the capabilities that cookies offer without any of the hassles associated with them.

Use the extra time wisely

Publishers have multiple alternatives available to them. So, they have no reason to continue relying on cookies, which puts their users’ data at risk and causes them to miss out on revenue opportunities.

Many smart publishers have already integrated with future-looking solutions. These enable the individualization of consumers in browsers where cookies are blocked. This enables them to get incremental value from their Safari and Firefox traffic and to lay the foundation for the future when all traffic will be cookie-less. This also allows them to offer their customers a better and more privacy-compliant experience on their website.

If you haven’t started this process already, Chrome’s delay is certainly good news for you. However, you shouldn’t wait. The time to act is now.

There are different approaches and solutions that enable user identification in cookie-less browsers. However, it takes time to evaluate, integrate and measure which of them bring the best results and offer the best level of service. Use this extra time wisely do not delay the process further. Start integrating and testing next-generation identity solutions and encourage your monetization partners and clients to do the same. Migrating to a new infrastructure requires a collective, industry-wide effort. And publishers are positioned best to lead the way.

Advertising | Perspectives | Supporter Spotlight

Will iOS and cookie privacy updates affect Facebook?

June 30, 2021 Todd Krizelman, CEO – MediaRadar

Facebook is a peculiarity, even among its fellow ad-supported media giants. Their ability to collect data from their two billion plus users, and package that data for advertisers, is second to none. Facebook’s business model is inherently more insulated from many market fluctuations that affect other advertising platforms because of Facebook’s network effect. Every new Facebook user adds new data to the system. That gives Facebook even more advertising data to sell to advertisers.

Yes, Apple’s iOS14’s App Tracking Transparency (ATT) changes, and Google’s plan to phase out third-party cookies, now delayed until 2023, will have an impact. However, the amount of user data being collected within Facebook and the value of that data is gold. And that’s even without tracking users across third-party apps and websites.

With Facebook’s vast internal network and collective data, Facebook ads aren’t going away. Instead, Facebook is adopting new privacy standards and will continue to play a significant role in the growth of small and niche businesses. Chief Executive Mark Zuckerberg stated that as a business, he believes Facebook can manage through the changes. He thinks it may emerge even stronger if it becomes harder for small businesses to navigate data targeting without Facebook. Here at MediaRadar, we decided to take a closer look.

Niche industries and ad targeting

Facebook reported revenue of $26.17 billion for the quarter, which was up 48% compared with a year prior. Facebook attributed the significant increase in revenue to a 30% year-over-year increase in the average price per ad and a 12% increase in the number of ads delivered.

The biggest spenders, accounting for 7% of ad spend, were entertainment brands, more specifically streaming brands such as HBO Max, Disney+ and Amazon Prime. One could assume, based on these numbers, that ad spend from large companies like these services accounts for Facebook’s success. Instead, what truly sets Facebook apart is how it caters to very niche audiences.

When looking at our data, of the percentage of retail industries that advertise on Facebook, a startling 62% fits into the “other” category which is made up of hyper-focused retail categories. Mind you, MediaRadar tracks over 7,500 product categories, and over half of them are incredibly specific.

Niches such as leather goods, herbs, telescopes, or cheese shops are not relevant to a majority of users. However, Facebook pinpoints who needs to see these types of advertisements the most. In addition, Facebook targets people with ads from industries that other platforms don’t. And, since they target users ads from plenty of market subsets, Facebook’s reach and revenue adds up.

Facebook is quite aware of its niche marketing prowess, and takes pride in it. In prepared remarks for the Q1 earnings release, COO Sheryl Sandberg chose to highlight someone who runs a yoga studio, and how Facebook helped her get the word out, as opposed to highlighting a major brand. It shows the value of their marketing strategy, and how appealing to the everyday consumer is what attracts advertisers to the platform.

Similarities to other platforms – and differences

Facebook’s reliance on niche marketing is strengthened by the fact that they are quite similar to other platforms in areas such as retention and campaign length. We found Facebook had a 34% retention rate between 2020 and 2021, similar to the overall industry average. As for campaign length, 44% of campaigns lasted one month or less, while 38% of campaigns lasted from two to four months.

The advertiser overlap rates between Facebook and other major forms of media is also a reason to point to niche markets as its success. In reviewing the data, we saw there was a 34% rate of overlap between Facebook and major broadcasters such as NBC and Fox, and those numbers are slightly lower when looking at podcasts and Snapchat.

The key stat for Facebook here is that nearly half of their advertisers are exclusive to their site, including nearly 60% of retail advertisers. While advertisers have the same buying patterns as everyone else, Facebook also attracts a lot of brands that aren’t selling on other platforms, and that makes them even more valuable.

What can we learn

Facebook’s success with niche markets provides a valuable lesson for us all: know your audience. No matter how big or how small, it’s important to make sure you market to your customers in ways that your competition cannot. With their vast network effect and their ability to package granular advertising data, Facebook’s dominance will only continue to grow regardless of whether they are able to track users across third-party apps and websites. But of course, they’ll need to ensure that they get privacy buy-in from their users, particularly as policy and user preference around this topic evolve .

Advertising | Perspectives | Supporter Spotlight

We’re entering the age of prediction-based marketing

June 23, 2021 Jürgen Galler, CEO and Founder — 1plusX

Digital advertising is characterized by constant change, challenges and – fortunately – innovation.

One intriguing and enduring industry plotline is the tension between data-driven targeting and user privacy. The narrative commenced with stricter data regulations. Now, it’s reached a critical point with the deprecation of third-party cookies and reduced access to mobile advertising identifiers.

There is no real replacement for third-party cookies and mobile IDs. So, we are starting to see a patchwork of targeting solutions emerge. We won’t entirely shift away from an identity even as we edge closer to a privacy-first age. Rather, success will be determined by a combination of solutions.

Privacy has been a prominent topic for many years. So has a demand for targeting. The reality is that some sort of ID solution will continue to be used for the foreseeable future. What we’re likely to see, however, is a move from precision-based marketing to prediction-based marketing. Thus, advertisers will increasingly rely on audiences built on the basis of having the highest probability to purchase their products.

Publishers, as the gatekeepers of first-party data, are poised to take a stronger position in the digital ecosystem. This is particularly true for those supported by artificial intelligence (AI) powered predictive analytics. These solutions will allow them to make the most of that precious data and achieve the scale advertisers need.

First-party data, identity, both, or more?

Unlike most participants in the digital advertising supply chain, publishers have direct consumer contact. And their advertising partners will benefit from first-party data drawn from that interaction.

Advances in data enrichment techniques enable publishers to generate user insights directly from that first party data. This allows publishers to offer the scale and quality marketers need to achieve their goals. It is also worth noting that solutions that allow data processing and the extraction of value closer to the source of the data also reduce the risks associated with data sharing.

To make use of their first-party data for targeting purposes, publishers can begin by creating basic reach among users that are known to them through log-in details or subscriptions. They can then form larger addressable audience segments by syndicating those user profiles through identity networks and matching them to a wider identity connectivity layer using AI-powered technologies to orchestrate and consolidate their data.

While the result of this process is a pool of audience insight ready for activation, these steps will still only deliver limited reach. The reality of extracting value from first party data is that established publishers need to balance paywalls and login screens with ensuring a positive user experience. Also, without being able to tap into predictive modelling on top of their first-party data strategies, publishers will struggle to achieve true scale.

From your current targetable audience reach to 100% (really!)

AI-powered predictive modelling allows publishers to monetize their inventory through targeted advertising in a way that is privacy compliant. That’s because it relies on logical, predicted — rather than declared — attributes. To fill the gaps in their data and expand reach, publishers can use algorithms to analyze on-site activity for users that have consented to this practice. Publishers can build detailed user profiles and intricate attribute patterns that include interests, habits, and preferences.

This information can be used for advanced audience expansion. It also enables targeting users with similar profiles, even if they aren’t logged in. It can also be used to predict attributes of anonymous users, such as gender, age, and interests. By combining these privacy-compliant profiles with real-time context and content information, impressions can be made addressable without user-level data.

This approach can even be used for retargeting by matching publisher and advertiser audiences based on similarities, using clean-room technology. With a clear picture of audience trends and preferences, publishers will be able to bring 100% of users within targeting range.

Contextual Targeting supercharged and cross-platform

A third element in the mix will be contextual targeting. However, it will be a more sophisticated AI-powered version of the contextual targeting we’ve known in the past. Using advanced analytics, publishers can determine what content users are interacting with across multiple digital properties. They can use this information to unearth granular interest areas far beyond high-level keywords. Targeting against these specific interest patterns will be particularly useful for native mobile channels, as well as connected TV and podcasts. Critically, it will allow brands to reach users when they are absorbed in relevant content.

This multi-layered approach to audience targeting in a world with no third-party cookies and reduction of mobile IDs will be beneficial across the supply chain. It allows publishers to effectively monetize inventory through relevant advertising that their audiences find engaging and applicable rather than annoying and disruptive. And it can do all this while respecting user privacy. For advertisers, predictive analytics enables them to spot the most receptive audiences at every stage of their digital journey and understand where they are most likely to be next.

As the targeting vs. privacy story heads towards its culmination, industry innovation will see a multitude of targeting solutions emerge. Overall, user-level targeting will shrink and both audience-level and contextual targeting will grow. Predictive marketing powered by AI and publisher first-party data will lead the way into a new age of targeting.

Perspectives | Revenue | Supporter Spotlight

Putting the value back in our industry’s opaque VAT

December 9, 2020 Bruce Brandfon, Chief Media Officer – Duration Media

As 2020, without a doubt the most challenging 12 months in our lifetimes, stumbles to the finish line, one undeniable lesson learned for all publishers is the need to focus on the sustainability of revenue streams. The turbulence of the market, the unexpected upheaval from factors that are unanticipated and entirely out of our control may well have become the new normal. So now, more than ever, publishers need to choose AdTech partners wisely and select those who can demonstrate the ability to deliver a tangible contribution to the bottom line.

Value chain drain

Earlier this year the UK’s ISBA (the Incorporated Society of British Advertisers) released their Programmatic Supply Chain Transparency Study in association with the Association of Online Publishers and conducted by PwC. This groundbreaking examination of the digital industry’s programmatic advertising supply chain shines a bright light on the lack of transparency shrouding AdTech costs levied against publishers and advertisers. Estimates of these fees range anywhere from 15% to 51% of revenue lost by publishers and of non-media expenses paid by advertisers. Graeme Adams, head of media at BT Group, took part in the investigation and branded the lost cash “a big hole in the value chain.”

These unattributable “taxes” are slow leaks in the plumbing of our ecosystem. They expose both the opaqueness inherent in the marketplace and the lack of trust in advertising technology third-parties. Certainly, we all agree there needs to be a greater level of transparency and accountability throughout what has now become the world’s largest advertising segment. And studies such as these are necessary to facilitate adoption of broadly applied standards and practices. However, painting all AdTech providers with the same negative broad brush runs the real risk of our “throwing the baby out with the bathwater.”

ROI vs. ROWe

Clearly there are technology vendors out there whose contributions to the efficacy of your programmatic advertising investment or a publisher’s bottom line are rightly suspect. Indeed, there are companies whose primary goal is self-serving. While they may promise to do no harm, they often fall short of guaranteeing measurable results and fully transparent visibility into their operations.

Their compensation is not directly tied to your ability to generate incremental income. Their tools are available for you to activate without the guarantee of a return on your investment. On the other hand, there are a select group of AdTech software providers who receive compensation only when their solution delivers measurable incremental revenue and income. That’s the ultimate measure of accountability.

Vendor or partner

Therefore, working with the right AdTech third-parties can make the difference, not only on your ability to “make your numbers,” but actually become the deciding factor between the survival of your business or its demise. We would modestly suggest that one way to decide who your best options are is to understand the nuanced differences between a vendor and partner:

Vendor: A party in the supply chain that sells goods and services to companies or consumers.

A vendor is a general term used to describe any seller of goods or services.

Partner: A person or organization you are closely aligned with in some way.

To partner is to join with another organization in a shared activity.

In summary we recommend a very careful evaluation among the myriad of third-party solution providers. Seek partnerships based upon full transparency, a shared commitment to mutually beneficial results, incremental revenue and income contribution to your bottom-line, and a guaranteed return on your investment.

About the author

Bruce Brandfon is Chief Media Officer of Duration Media. Prior to that he was Executive Vice President of Webspectator . He was Vice President and Managing Director at Publicitas. Prior to joining Publicitas, Bruce was Vice President of Sales for the Philadelphia Media Network. He has also held leadership positions at Scientific American, Newsweek, and Time Inc. Brandfon is Director of the Board of Advisors at Planet Forward. And he’s an Adjunct Professor of Media Studies at Westchester Community College. He contributes frequently to industry publications.