In today’s digital world, data privacy has become a top priority for both consumers and businesses. The driving force behind this shift has been the public’s awareness of how data is collected, used, and sometimes misused by businesses. As concerns about data security and personal privacy have grown in previous years, advertisers are still challenged with finding ways to reach their audience. In this article, we’ll look at how privacy updates have changed the face of advertising and how businesses can succeed in this new landscape.
Privacy History
We have to go back just a few years to look at where things really took a turn. Data breaches and poor data protection practices were starting to create concerns with consumers, prompting the government and tech companies to respond. We all remember the Facebook/Cambridge Analytics breach in April 2018 that impacted roughly 50-90 million users. The FTC stepped in and fined Facebook a historic $5 billion and mandated new privacy requirements.
The next major impact on digital advertising came in April 2021 when Apple launched App Tracking Transparency (ATT) as part of their iOS 14.5 software. This required that all iOS apps ask users for permission to share their data and users can either consent or deny tracking. Since going into effect roughly two years ago many advertisers and platforms have complained about lost ad revenue. Facebook being one of the largest, estimates that the update cost them $10 billion in revenue for 2022.
Another notable change in the privacy landscape is the phasing out of third-party cookies. These pieces of code have been the backbone of online tracking for years, allowing advertisers to collect user data across websites and apps. Recently, major companies like Google have announced plans to block third-party cookies, which will leave advertisers searching for alternatives. There will need to be a shift towards first-party data in order to maintain effective targeting and personalization options within ad campaigns.
Privacy Solutions
First-party data in advertising refers to the information that a company collects directly from its own customers and because of that, it is considered more privacy-friendly compared to third-party data. By building trust and providing value to your audience, you can encourage users to share their data willingly. Overall, first-party data can help businesses connect with their audience more effectively, improve ad targeting, and build customer relationships based on trust and relevance.
With limitations on user data, contextual targeting is another reliable tool for advertisers. By focusing on the context of the content and user behavior, relevant ads can still be delivered to the end user without relying on user-specific information. This can be more effective in some cases as it is based on what users are doing in the moment rather than focusing on personally identifiable information (PII)
Each day we all use our mobile phones for business and personal tasks. We download social media and e-commerce apps and let’s be honest, none of us are scrolling through the 10-page terms-of-service agreement. I think we all just want the option to opt-out or receive notifications letting us know that our data is being collected, or our microphone is active, or our GPS location is being used. It’s transparency that matters.
In conclusion, businesses must communicate openly with users about data collection and usage. Being forthright about data practices can build trust and differentiate your brand in a crowded marketplace. Clearly explain your data policies, allow users to opt in or out of data collection, and provide accessible privacy settings.
Businesses that prioritize these practices will build stronger, more trustworthy relationships with their audience and customers.