The problem with third-party audiences
“Look honey, I made a map of our first date!”
I’m a romantic guy — at least, I thought I was. For the anniversary of my wife and I’s first date, I mapped a timeline of all our geo-based data overlap from that day. You have to admit, it WAS romantic. But she didn’t agree. Being a social worker (aka not in marketing), her initial reaction was mostly shock at the implications of what we, as marketers, consider to be innocuous data, and how easy it was to access it. This led to an interesting conversation — as always.
I had easily gained access to every place she went, every day, going back quite a long time. The CIA and KGB would have loved to have had access to that kind of data back in the 80s (which is why Apple is fighting so hard not to put a backdoor in their system). Had I been a controlling boyfriend? I had the tools to fully monitor her time and discover where she was hanging out, without her knowledge. Creepy, isn’t it?
Now, let’s apply this anecdote to an entire industry, namely the business of personal behaviour data and its use for commercial gain. In a nutshell, this is what data vendors do. Especially third-party data vendors. As for digital marketers, having access to this kind of data gives us a cool factor in front of senior management, especially when we are making edgy advertising campaign presentations, cryptic MarTech buzzwords and all.
Of course, as digital advertisers, when we’re asked about the creepiness of this type of targeting (i.e., remarketing ads to store users based on location data showing they recently shopped at a competitors’ store), we always defend ourselves with the same old argument, “Don’t worry, we use anonymized data, we would never PERSONALLY identify an individual.” But just because we choose not to, doesn’t mean we can’t do it.
We as marketers may not be personally responsible for the relentless tracking of users, but we do enable it, by demanding increasingly high ad performance. There’s an article in the New York Times that summarizes this well:
For brands, following someone’s precise movement is key to understanding the “customer journey” — every step of the process from seeing an ad to buying a product. It’s the Holy Grail of advertising […], the complete picture that connects all of our interests and online activity with our real-world actions.
Now, taking a step back, especially in light of the recently announced third-party cookie apocalypse, a moment of self-examination might lead us to ask ourselves as marketers: how did we get here?
When I started working in advertising, behavioural marketing consisted of targeting people who behaved in a particular way on a website, specifically that they spent a lot of time looking at a particular content section.
These segments could be as simple as “Avid News Readers” or “Sport Enthusiasts.”
It worked well, and life was good. Advertisers could reach premium visitors in less a premium context. They could sell outdoor gear to sports enthusiasts in the astrology section. Clients were happy, the results were there, and publishers sold previously unsold inventory. Everybody won.
Then, the focus shifted more towards behavioural patterns: not only were we targeting behavioural data, but also (mostly) purchase intent and past purchase intent. Remarketing was allowing us to do incredible things. A user was shopping for a ticket to Cuba? We’d push a flight to Cuba! At the time, this was considered highly innovative. Clients were even happier.
Down the rabbit hole we went; so far down that I can’t cover all of it. It is a deep hole. But I can say that back in 2014, we would have been able to target you based on:
- How far you lived from a city;
- When your plane was leaving;
- The type of credit card you use;
- Whether you had checked an animal into a tour flight;
- Your marital status.
Yes, all at the same time. The old, “Just because we can, doesn’t mean we should” definitely applies here.
Data resellers had a simple pitch:
We have more of the most comprehensive data points in the market in our cutting-edge machine learning algorithm designed by our in-house PhDs, and it is guaranteed to give you the best performance around!
To make sure they had most data points, data resellers started collecting everything and anything that connected to the Internet, then turned them into beacons. The top nine companies quickly became data oligarchs.
The truth is, cellphones became everyday advertising GPS signals. As if that wasn’t enough, some of the data oligarchs started eavesdropping on our conversations — and I’m not just talking about devices that are known to be listening, like Google Assistant, Alexa and Siri. Research such as this study, dating as far back as four years ago, found 247 SilverPush Android applications listening to the background chatter on users’ devices. WeVibe, a company selling premium sensual lifestyle products (also known as a sex toy company) tried collecting user data through their mobile app. This was clearly crossing a line, and in the end, the bedroom stayed private. But let’s just say people reacted very strongly.
Data is becoming the new oil (according to some, it has been since 2006), and the giants of MarTech are already acting on it. Why do you think Google offered all its paid users and all Spotify Premium users a free Google Home Mini right before the 2019 holidays? Talk about “listening in!” Oh, and Gmail users, what about email confidentiality? Remember the saying, If you’re not paying for it, you are the product.
The advertising world transformed into an Orwellian tracking universe, where everyone was trying to undercut everybody else just to get an edge. Surveillance cookies started popping up everywhere, and brands were not even aware that their visitors’ data was being stolen from their platforms in exchange for performance numbers.
This was all powered by a desire for greater performance… and cookies (the anonymized tokens that follow us online). Anonymized? Hold on. The second we’re able to match information from one cookie to another, we can connect the dots. And that collecting, packaging and then sharing (selling) was the bread and butter of third-party audience advertising. Bottom line: data reselling companies knew something about prospects, packaged it and sold it to marketers so you could give better results to your decision-makers. How could a simple transaction evolve into such a heated privacy issue?
The lack of privacy is real. Imagine that your employer started using RFID technology (like card readers) to track when you entered and left the office. Then, for performance purposes, they totalled up your kitchen usage, and then slowly, one step at a time, ended up requiring you to use your card every time you looked at any file online. It IS Orwellian.
The Orwellian surveillance system will not die with the cookie apocalypse. It will only get stronger as technology evolves — in the US, for example, telecoms are able to collect information contained within the data packets sent through their cables (in Canada there is a privacy law that protects us, but even still, concerns remain). If you thought Facebook or Google had a lot of your personal data, look at what Verizon/AT&T/Comcast will soon be able to do in the US and maybe one day in Canada in the very unlikely event the CRTC was overruled. Smart TVs also represent a technology gathering a tremendous amount of data from users.
Do not despair about advertisers and agencies! The third-party audience storm that’s coming does not mean the end of performance advertising within DSPs. It will simply reshape the market. Walled data gardens will, in fact, become stronger as the giants of the web are all securing their data borders in order to contain their data within their own ecosystems. Could this be a chance for local publishers to gang up, organise their common data and start offering their own “performance platforms” activated by audiences? (Crossed fingers). The plight of local publishers is beyond the scope of this article, however it’s important to point out that they were the ones who lost the most from third-party data audiences.
In a nutshell: the data oligarchs are pulling the ladder and securing their walled data gardens.
There’s definitely a lot to think about regarding the use of data generated by digital advertising. Our team’s approach is constantly growing and adapting based on what is happening in our industry, and we are always happy to offer guidance and support when it comes to making the right choices for the future of your business, and the privacy of your users. Get in touch if your want to talk more about this topic!