One of ad tech’s chief promises was that it would finally fix advertising. The advent of real-time bidding (RTB) in the late aughts ushered in ad tech’s “Age of Easy Answers” where the frustrating ambiguities of marketing and advertising would steadily be rooted out and obliterated by data and algorithms.
However, as 2020 dawns and digital privacy is increasingly prioritized over the needs of the ad industry, tech- and data-driven solutions face a messier future and fewer easy answers. Technologies like unified or open ID regimes, multi-touch attribution (MTA), and RTB are under threat from the current focus on user privacy, precisely because those technologies require direct and detailed visibility into what people are doing online.
Despite ad tech’s best-laid plans, the real world has turned out to be a messy place where private citizens, tech giants, fraudsters and regulators don’t necessarily prioritize making digital advertising easier for advertisers. How dare they!
In many cases, the solutions to advertising’s challenges beg organizational innovation as much as technological, but this shift to a more holistic mentality sheds light on ad tech’s path heading into 2020 and beyond.
A Unified Id—All That Cat-Herding for Nothing
A unified, shared or open ID is perhaps ad tech’s most tantalizing easy answer. If the whole ecosystem could just agree on a regime that would track people everywhere (on an opt-in basis, of course), many of ad tech’s self-inflicted woes would be solved. Unfortunately, a large-scale unified ID suffers from at least two seemingly intractable flaws: it would be a tempting feast for privacy regulators and ambulance-chasers, and it would give browsers, apps and devices a convenient Single Tracker to Block (to wit: Firefox blocking the Digitrust ID by default).
While it’s difficult to see a unified ID riding to ad tech’s rescue at this point, there is tremendous potential for narrowly scoped data co-ops to unlock business value (e.g., between advertiser and retailer), or for publishers to leverage the full potential of their reader and subscriber graphs. So I suppose the organizational lesson here is: “Limit your herding to fewer, more cooperative cats.”
MTA Gets Downgraded to “Some” Touch Attribution
As originally conceived, MTA was meant to give marketers clear and objective insight into the respective contributions that marketing channels and touchpoints make toward conversions and other goals.
The recipe for marketers was simple: install a set of tags, pixels and click trackers pretty much everywhere you possibly can and then wait for answers from the MTA genie. However, in order to fully deliver on that promise, comprehensive MTA needs more insight into cross-device, cross-channel, user-level behavior than it is likely to be afforded in a privacy-first environment.
Luckily, the principles of MTA (and attribution measurement in general) remain very much in play within solutions that blend technological and organizational innovation. For example, attribution measurement based on second-party data co-ops can answer the question: “Did readers who saw Brand A ads on Publisher B then make a purchase at Retailer C?” Answering that question makes heavy use of technology, to be sure, but building data co-ops also requires careful vetting, planning and negotiation, along with careful attention to basics like proper campaign naming across partners, channels, and funnel touchpoints so that some sense can be made from co-op data after the fact.
Who Will Be Left to Bid on in Real-Time?
RTB was ad tech’s original “killer app.” The idea of buying ad space in real-time at a user level has spawned dozens of ad tech categories and thousands of companies. But can RTB be made “privacy-friendly?” That remains to be seen. The U.K. Information Commissioner’s Office (ICO) seems to think that RTB might well run afoul of the General Data Protection Regulation (GDPR).
In possible preparation for a reckoning, Google is planning to strip contextual data from bid requests. This move doesn’t seem to have caused much uproar, but could it be the beginning of RTB’s death by a thousand cuts? There is certainly no denying that the core principles of RTB (specifically: real-time, direct visibility into web and app users) are very much at stake amid the current debate over digital privacy.
I have good news: RTB isn’t the only way to buy digital media! eMarketer estimates that programmatic direct is now growing faster than RTB, with over $35 billion in 2019 spend projected to surge to over $53 billion in 2021. But in keeping with the general moral of this piece, programmatic direct isn’t a plug-and-play, technology-only solution—it raises organizational and business questions. Without a bidding algorithm making all the decisions, how should marketers identify, negotiate and measure direct placements? How should publishers’ core value props (both to readers and advertisers) evolve when no longer yoked to unforgiving RTB auctions? How will the entire ecosystem ensure that this isn’t a regression to the “spray and pray” tactics of yore?
The Truth Is There Were Never Any Easy Answers
If you’ve read this far, I hope you don’t think I’m throwing ad tech under the bus. I’m not, nor is that the point. Ad tech has a bright future and is maturing as it enters its teens. If ambitions of “solving advertising” with technology alone have proved fanciful, then a more balanced, holistic mentality makes sense. In fact, a dying-off of many of the “easy answers” of Ad Tech 1.0 ought to seriously reinvigorate the ad tech landscape, put a greater emphasis on tradecraft for marketers, and offer publishers, agencies and partners new opportunities to shepherd the industry forward in 2020 and beyond.