How Will an Entire Industry Unlearn Ad Tech 1.0?

I don’t know about you, but I’m pretty confident that digital advertising technology and “Privacy with a capital P” will learn to co-exist. However, that still leaves a growing blind spot in the conversation about Privacy: no matter what “Ad Tech 2.0” ends up looking like, hundreds of thousands of digital advertising professionals around the world are going to have to relearn how to advertise under a very different set of assumptions and constraints.

What exactly are these new constraints? In short: Ad Tech 2.0 won’t offer marketers nearly as much access to deterministic, user-level, and cross-site/cross-app data as they’ve grown accustomed to. In many cases, user-level data will dry up completely.

While I think we would all agree there’s some urgency to the situation, alarmism is not my point. Digital advertising will still work fine with some adaptation. Ad Tech 2.0 is going to unleash opportunity the likes of which we haven’t seen since the advent of real-time bidding, but that opportunity is going to be held back by the rate at which we can collectively re-educate ourselves (and remember: a lot of us are 40+ like me and extremely resistant to change!).

Ad Tech Playbook, You’re Looking Very Svelte These Days!

The current ad tech playbook goes back maybe 15 years, and its dog-eared pages are gradually falling out. Consider this: there are veteran digital advertising professionals who have spent entire 10+ year careers never knowing a world without 1:1 targeting and unlimited third-party data. Many of us literally never learned how to advertise in a fuzzier, less deterministic world.

To put the scale of this looming tectonic shift into perspective, the 2019 US programmatic display ad market was over $57 billion according to eMarketer. Tens of billions of those dollars were surely spent using third-party behavioral targeting and measured using cross-site tracking.

Those billions won’t just reallocate themselves. First, marketers will need to understand what no longer works (and why). Then they’ll need to understand what does still work (and why). Then they’ll need to understand how to apply these “privacy-friendly” tactics to a media plan. Then they’ll need to figure out how to measure campaigns so they have some rational basis for decision making. Meanwhile, the whole industry will be going through an awkward process trying to agree on things as basic as a new shared vocabulary. Opportunistic charlatans will abound. Companies will rise and fall! Like a disappointing Star Wars movie, the Ad Tech 2.0 playbook is bound to go through a lot of rewrites.

Letting Go of Ad Tech 1.0

Ad Tech 1.0 was built on the assumption that a rising tide in an ever-deeper ocean of user data would lift all boats. User-level bidding algorithms would make media planning obsolete. Personalized “octo-box” retargeting ads could overcome their godawful appearance with algorithmic sorcery. Attribution tech that could see a user everywhere was clearly the Holy Grail of measurement. Contextual advertising and other approaches that couldn’t discern users amounted to “spray and pray” tactics and were therefore foolish and backward. The list goes on.

Whether these assumptions were factually true or not is irrelevant; they were basically sacrosanct to an entire generation of digital ad professionals. If they weren’t, the crowded LUMAscape would have looked much different (and perhaps not existed at all). But as circumstances undeniably change, tried-and-true rules of thumb ought to be questioned.

Ad Tech 2.0—don’t Knock It ‘til You’ve Tried It

To a generation of digital advertisers steeped in the primacy and absolute necessity of user data, Ad Tech 2.0 is likely to feel a bit unfamiliar.

New customer acquisition is likely to change a great deal, because marketers will, in many cases, be kept at tantalizing arm’s length from the people seeing the ads. Finding audiences will require experimentation with non-user-data-reliant (whoa, that was a mouthful—see what I mean about needing a new shared vocabulary?) tactics like contextual placement and incrementality testing. Marketers will have to untangle how to deliver ads to users of apps, platforms, and publishers in privacy-compliant ways. Triangulating on the right media plan and targeting strategy is going to require an appetite for calculated risk that was anathema to Ad Tech 1.0.

Likewise, if measurement solutions like data clean rooms or Chrome’s proposed Privacy Sandbox gain traction, marketers will have to learn how to analyze performance at a rougher cohort level that is simultaneously fuzzy and entirely deterministic. I’m dating myself, but think of visiting the library reference desk versus checking books out and taking them home. The books and all the answers they contain are still there, you just can’t hold them in your hands. Over time, you learn that the path to the right answers is to become a better question-asker.

Go Ahead and Bite the Apple

This process will take years. It will require intellectual curiosity; an openness to pre-cookie marketing doctrine we were all taught to scoff at; an appetite for risk and experimentation. And while eventually, we will all surely get there, the opportunity now is to unlearn faster than the rest of the herd; to build a commanding lead while everyone else is still at best taking reluctant baby steps, and at worst clinging to tattered and well-memorized playbooks.