The Impact of Privacy Laws on online advertising and innovation.

The Impact Of Privacy Laws On Online Advertising And Innovation.

  • Aug 05, 2020
  • 773 words
  • 3 minutes read
 
Photo by Matthew Henry on Unsplash 

The General Data Protection Regulation (GDPR) came into effect on the 25th of May 2018. Since then, many European companies got fined for violating this law.  Outside the EU, some countries or states have adopted laws that are similar to the GDPR. Also, browsers are pushing to respect privacy by blocking third-party cookies and other means to track consumers.

Display advertising in the '90s

We all remember the beginning of advertising in the '90s. Because there was no way to serve meaningful ads, sites would show many ads hoping there would be one that triggered the visitor.  Because of the competition on a page, banners would scream for attention. By adding blinking effects and big fonts. 

Banners on Geocities

Contextual advertising brought an end to that. With more data and tailored ads came higher conversions. Contextual ads caused fewer advertisements and better integration within the website. We did not try to guess what triggered the consumer; we knew what triggered them.

The birth of the third-party cookie

Ad networks made it easier for everyone to advertise and to make money with an online product. The birth of the third-party cookie, mostly set by the ad network to collect visitor data and serve relevant ads over multiple websites and use techniques like retargeting.

Advertisement fueled online innovation.

Almost all online innovation got fueled by advertising: products, news sites, tools. But also art, research, free speech. Taking away the mechanism to make money on users will drastically impact innovation. It will lower the revenue per ad space for a publisher and lowers the ROI for an advertiser.

First-Party data is crucial.

With the right set of privacy tools in place, it is vital to start collecting your own, first-party data about your (potential) customers. Sometimes third parties can even help us generate those insights. Some examples:

1. Email Marketing

Email marketing is still big in 2020. Letting clients sign up for your newsletter (and giving something in return) is a way to start building your dataset. Smart techniques can register interest by click behavior. Try creating these sets within your owned domain and do not rely on data sets of third party newsletter vendors.  

2. User accounts

Buy offering something behind a login; you can identify users over multiple devices. Accounts work great in combination with newsletters (just an account to manage preferences is enough)

3. Social Media Advertisements

Social networks have a vast amount of targeting options. Using that data within the platform is allowed. By using targeted ads with specific lander pages, it is possible to create your dataset from social network data.

If you're a B2C brand, social media advertising could be especially helpful to you on platforms like Facebook, Twitter, or Instagram. For those in the B2B industry, targeted ads could be incredibly beneficial on professional networks like LinkedIn.

4. Fingerprinting

A bit of a grey area and still under substantial debate. There are many levels and methods of fingerprinting, and some browsers are blocking this already. (like canvas fingerprinting). 

Read further: Google proposes new privacy and anti-fingerprinting controls for the web - TechCrunch  

5. Back to the '90s

The availability of cheap ad space like pop-ads, push-ads, etc., makes it possible to advertise at an untargeted audience. Create generic and attention-grabbing creatives and a lander page with interaction. This way, you can turn cheap untargeted traffic to valuable data.

Read further: Services by Auditeers; Push notification Advertising - Auditeers | The traffic Company 

What about Google's Privacy Sandbox?

While Chrome will phase out the third-party cookie, it will allow advertisers to use Chrome's first-party cookies to target ads. Chrome will reportedly enable brands to use its first-party cookie, while still protecting the data of Chrome users, via Google's proposed Privacy Sandbox.

Read further: Building a more private web: A path towards making third party cookies obsolete - Chromium Blog 

At this point, Google has only announced plans for the Privacy Sandbox, so it's still unclear how it will work. However, since it will leverage Chrome data, marketers expect that this will allow advertisers similar hyper-targeting similarly to third-party cookies.

Conclusion

Killing the third-party cookie and the new privacy laws will significantly impact online innovation, art, and free speech. But new techniques will emerge, and browser vendors will come up with methods to cope with tracking and privacy.  Anyone working within online advertising must be lean and flexible to adapt to these changes and find innovative ways.

Data is more valuable than oil. At Auditeers, we push our clients to start building rich datasets about their potential clients.


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