A year ago Safari, Firefox and Explorer scaled down and dismantled their third party data. Furthermore, no later than January the 1st, 2023 Chrome is set to do the same. The Dutch Data Protection Authority has launched primary investigations into some organisations. They have recently issued substantial fines to parties including Tiktok, for the violation of the privacy of children, Booking for reporting a data breach too late and (later proven unjustified) to Talpa due to the video images of Voetbal TV. The data market is currently under pressure, with all parties preparing for stricter regulations in the future. Advertisers however, have been able to take full advantage of third-party audience insights and targeting and continue to do so today. A benefit that will very soon come to an end.
Here I, in collaboration with privacy expert Lejo Duivenvoorde, answer the most pressing questions.
On the other hand, there are already many possibilities via the third party route, and also in the future. Scale will be a major challenge here. Since the announcement that third party cookies may no longer be used, Google is no longer open to new third party data suppliers.
These images will soon be a thing of the past….
Well no, I don’t think so to be honest. Currently only a small portion of advertisements are geared towards audiences acquired via third party data providers.
My rough estimation, based on a number of recent conversations with digital planners this year (2021): Over half of all Dutch digital campaigns are broadcast without targeting. In the cases where targeting is used, on average 20% is on affinity groups, 10% behavioral, around 20% in-market and 50% on socio-demographic factors.
Targeting based on the focus, content and performance of the publisher is the most common. Of course, this varies greatly per advertiser, agency and market in which we operate. Usually the data used is the advertiser’s first-party data, or based on the profiles of Google and other publishers.
So, at the moment, there’s actually very limited purchasing for audiences based on third party data suppliers. The publisher data is especially central, which is beneficial for the advertiser because the publishers will ensure that they are GDPR/ePrivacy compliant. They do this by having their visitors log in, so that the necessary consent has been given and they know who’s online based on these login details.
Chart based on VIA taskforce Data & Technique
More and more advertisers are activating their own (first party) data in order to run their campaigns. In combination with publisher data this, in fact, has considerably more value than any third party data provider. By making use of ‘Customer Matching’, based not only on hashed email addresses but also on offline data, such as telephone numbers or address information, audiences can be created at the larger platforms and publishers.
If necessary it is also possible to roll out a data strategy aimed at collecting more relevant data from consumers. This can be done for example, in collaboration with a research party such as Kantar, Gfk or IPSOS. A nice case of Vodafone/Ziggo and IPSOS, ‘Humanizing Data’, was recently presented during the MIE 2021 (download the presentation here).
Alongside this, there’s the opportunity for agencies and publishers to play a larger role when it comes to matching the advertisers data sets. This gives advertisers the ability to see which clients can be reached by which channels and furthermore, exclude existing customers and even target look-alikes. Of course publishers can also – just like Google and Facebook – infer interests, intentions and other behaviors, based on search, reading, listening and viewing behaviors on their platforms.
Transparency to advertisers regarding how these groups are composed is imperative. As a result of banning third party data and the cookie, data for advertisers will be of better quality and much more effective.
In reality, there are only a few parties in the Netherlands that currently offer advertisers a sustainable and scalable product. While many publishers do have the potential to play a role, with the exception of parties such as Google, Facebook and DPG (DataLab), who have come a long way in its development, for most, it is still under construction.
In order to link first party data with publishers and activate it so that advertisements can be targeted to these groups, advertisers can either contact these publishers themselves, or they can use a middle-man such as digitalAudience and EDM. When in doubt, media agencies and specialised independent consultants such as SilverLabs, Reynolds and Onbrdng can provide good advice. Find an agent with knowledge of behavioral sciences, data and tech.
But, I hear you ask, why would you just share your customer data with another party? In sharing your customer data, despite the conclusion of the required processing agreement, you give the publisher and/or the onboarding party wisdom. The way to handle this is two fold. Firstly by using the mechanism of ‘hashing’, in which data is only shared if one of the personal characteristics is shared by the other party. The second step is to match customer data only via that mechanism from a heavily guarded, protected environment (a ‘Safe Haven’ or Data Vault) and only to share, for example, selections (in/out selection). Infosum and Liveramp, among others, offer these services to a growing number of retailers and financial service providers. The Dutch digitalAudience is also developing a solution for this.
Many advertisers are highly dependent on third party data, in fact most don’t know who their own customers are. For example, most FMCG companies. You could argue that it matters less to them; because they still make their products for everyone and distribute them through indirect channels: So targeting seems less important in this case.
In practice however, it’s often very relevant to at least know who is and who is not buying your product. In addition to who, for example, is already very loyal. Purely for the purpose of making relevant advertising and avoiding irritation and unnecessary waste of the media budget.
Advertisers who do not possess their own data must, therefore, develop a strategy to build a relationship with their customers, and with it, data. This will enable smarter targeting and personalisation across all publishers. There will also be great opportunities for Dutch publishers in markets where Google and Facebook do not want to be active: this concerns, among others, advertisers in the field of healthcare (including hearing aids), loans, dating, gambling, political parties and video games (click here for the full list).
It now falls to all advertisers that they must become more critical with regards to the collection and storage of customer data. For that, it is also necessary to understand which data is the most valuable for the marketing strategy and personalisation of advertising. In addition to confirming that the correct permissions have been requested, in order to use this data for advertising purposes.
In conclusion, banning third party cookies offers a new and promising playing field for advertisers, publishers, tech parties and agencies. When targeting audiences, first party advertisers and publisher data will play a leading role in addition to contextual targeting.
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