If you are one of the people out there who think that businesses do not take appropriate measures to protect your data, you are not alone. The news has been rife with scandals and hacks with giant amounts of data stolen and made available all over the Internet. And it’s not just little startups who play fast and loose – major companies with large amounts of sensitive data like credit ratings agencies and Capital One (who alone had data on 160 million Americans that was hacked) are increasingly becoming targets. Those who are running behind the times on security get breached. Once your data is gone, it’s safe to say that it’s gone forever.
It’s not just data that you give to a business, it’s also data that’s gleaned from what you do online. If you take a deepdive into how real-time bidding (RTB) works to deliver ads that are the most relevant to you, you see very quickly that publications (and the technology that underlay them: demand side platforms (DSPs)) blast out tons of information about you to an unknown number of other actors who are connected to ad servers to deliver impressions. The nature of RTB is a technological marvel, but it also creates a black hole of accountability where the supply chain of ads is opaque and information like your device ID and the type of content you were looking at – along with your location and a myriad of other information – is sent out to who knows who.
For a long time this wasn’t that much of a problem. The technology was rather simple and people hesitated before giving their data. As more and more services shifted into the digital realm, people had no choice but to cough up more and more of their personal information. So between the voluntary information that we give companies in order to use their services, and the involuntary information that is gleaned about us while we use other services, nearly all of our information is available online.
2019 can be seen as a tipping point year where a lot of people are waking up to the reality of the Internet and the fact that this whole digital thing has gotten so big so fast that we sailed into uncharted territory without bringing a motor to get us back to where we came from. The malaise that humanity is feeling is seasickness. The backlashes have begun.
“But I need that data”
said every marketer everywhere. All of these efforts to store, process, and profit from personal data came out of computational progress built on the backs of startups and large tech platforms who would meet at the Moscone in San Francisco and talk about how they were going to make marketing so much more efficient by helping us eliminate waste and only reach people that matter to our businesses.
The desire to obtain this information drove progress while consumers happily scrolled their social feeds. And the effort to keep the concept of data collection benign was in full force since the beginning. What do you call a piece of code that follows you everywhere and tells third parties what you’ve been up to online? A personal tracker? A spy? No! It’s a cookie! And who doesn’t want a cookie?
The promise of data-enriched marketing campaigns has provided the foundation for the seismic shift in marketing spend from offline to online. Nowhere else can you access the rich trove of personal information for making sure that you hit the right people at the right time – and in the right place now that mobile technology is ubiquitous. You could argue that the only time for running a better marketing campaign than today is tomorrow.
At least, that used to be true. Enter the Privacy Wars.
You see, nothing in digital happens in a vacuum as an interaction between a business and a customer. There are gatekeepers, and the gatekeepers can be divided into two categories: hardware and software. Hardware gatekeepers are the makers of the devices through which we access information. The two biggest are Apple and Samsung. They decide what types of programs can be used on their devices. They control the apps and a lot of what apps can do.
Then there are the software gatekeepers, which can be further split between the browsers and the platforms. The browsers are controlled by Apple, Google, and Microsoft (among others) and then there are the platforms: Facebook, Google, and other social networks.
You’ll notice that there is a big difference between Apple and Samsung and Google. The first two are not dependant upon advertising, Google is. And since Apple and Google are competing in many spaces, how does Apple go after Google? Hit them in their weakest spot: privacy.
Google relies on ads to make money. The better they are at targeting and delivery, the more they can charge. That means collecting customer data and leveraging it. Apple relies on people buying iPhones every few years as well as buying some iCloud storage. Apple doesn’t leverage its customer data, and Apple wants you to know that.
Apple has launched a direct attack on the current online advertising business by deciding that Safari – its proprietary web browser – will no longer accept any third-party cookies. None at all. Nada. Consumers like this because this type of action removes the creepy tracking ads – like seeing an ad for shoes on Facebook the day after you checked them out on Asos. For digital marketers though, it represents a new challenge: how can we continue to be more effective in a world with no cookies?
BTW: I don’t like using terms like “attack” and “war” to describe general business trends, but the analogies are just so fitting, thus is the world in which we inhabit.
The first major volley from Apple will lead to responses from other businesses. Who would choose to use a browser that doesn’t respect a user’s privacy as much as Safari? Other businesses will have no choice but to address privacy seriously – at least as seriously as their competitors. This is how the privacy wars will escalate.
For consumers, it’s a virtuous circle. Companies will battle each other for our trust. By being more responsible and limiting the exposure of personal information, everyone wins.
Everyone except digital marketers of course. For us, it’s a vicious circle at the exact time when more brands lean increasingly on digital and want to see the best possible results. The ability to remarket to people who abandonned a basket on an e-commerce site, or to profile people to ensure that an ad for adventure sports is marketed to people who have shown interest in that topic in the past, or to be sure that the different waves of a digital media campaign hit the same audience: all of this is in jeopardy with the current trajectory of privacy. Strategies that we’ve worked so hard to create can now be rendered moot for parts of our audiences by gatekeepers vying for other objectives.
Where Brands Go From Here
Like any war, there will be winners and losers. We have to assume that given today’s skeptical climate around big tech that the end of the war will see privacy trump other concerns. The losers will be ad tech. The winners will be the consumers (depending on how you look at it). Adam Smith would be proud.
I’ve been saying this for a while but brands can no longer build strategies that are subject to the whims of gatekeepers. No brand can influence Apple, so Apple will do what’s best for Apple regardless of what happens in the rest of the world. It is more important than ever to get your customers into owned ecosystems.
The only true owned ecosystem is a CRM program where you have customer information and you can contact them via email or other channels. When a customer opts in, they are giving you explicit permission to have a relationship with them. This is the only true relationship that brands can rely on for the longterm. When people accept cookies on a website they have no idea what they are actually accepting. They are just trying to get to the content behind the banner. When someone likes your brand on a social platform, you are still beholden to that social platform to reach that person. Look at all the good building up organic audiences did for us on Facebook?
Digital marketing is going to get a lot harder before it gets better. The wild west days of swaggering into town with new ad tech and out-drawing your competitors is over. As an industry we are going to have to accept that privacy is a pre-requisite for doing business online, and we will have to make do with fewer options and less information about our target, until another shift or a new solution comes along.
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