Programmatic advertising is a game changer for brands. Automating the process of buying and selling online advertising delivers efficiency, more precise targeting and bigger impact. With consumers and regulators increasingly focused on protecting data and preserving privacy, it’s up to brands to ensure their programmatic advertising campaigns comply with new and emerging data regulations.
Programmatic advertising is a game changer. Automating the process of buying and selling online advertising delivers efficiency, more precise targeting, cost savings, greater consumer insights, stronger ROI and bigger impact for publishers and brands alike.
For marketing and sales functions, programmatic advertising provides more control over who sees your ads and allows you to target a wide range of platforms, including mobile, digital out of home, display, video, audio and connected television channels. Most importantly, it ensures you target the right audience at the right time. It’s no surprise that over the next two years global programmatic ad spending is expected to surge past US$700 billion, up from US$407 billion in 2022.
To this point, programmatic advertising has relied on third-party cookies to track users’ online interactions and gain insights into their behaviour. This is about to change as Google’s Chrome browser joins Apple’s Safari and Firefox to eliminate third-party cookies. Something else that’s about to change: Brands will have to protect users’ data and prove they are protecting it.
The phasing out of third-party cookies is the result of increasing consumer concerns about how their data is being used which, in turn, has led to a growing number of consumer privacy regulations to protect user data. Most notably, this includes the European Union’s General Data Protection Regulation, the California Consumer Privacy Act and Canada’s Personal Information Protection and Electronic Documents Act.
With consumers and regulators focused on protecting data and preserving privacy, it’s up to brands to ensure their programmatic advertising campaigns comply with new and evolving data regulations.
In this article, Postmedia shares best practices to maintain data privacy compliance in programmatic advertising.
Data Privacy Compliance and Best Practices in Programmatic Advertising
Know where your data comes from
In a world with no third-party cookies, brands have to rely on first-party and second-party data. First-party data is the data brands and publishers collect directly from their websites, apps and customer relationship management platforms. Second-party data is essentially first-party data from another source. For example, if one of your business partners collects data and shares it with you, it becomes your second-party data and you can use it in the same way you use your first-party data.
Tip: Understand and be transparent about where your data comes from, and how it is gathered, stored and shared with your partners and audience.
Understand the technologies that underpin the programmatic advertising ecosystem
Brands have access to tools and platforms for their programmatic advertising campaigns. Advertisers use demand-side platforms (DSPs) to automate ad buying and publishers use supply-side platforms (SSPs) to automate selling their advertising space. Ad exchanges are the digital marketplaces connecting the two. Customer data platforms collect first-party data from multiple sources and use this information to create a holistic view of each customer. In the background are data management platforms, which collect, organize and leverage first-, second- and third-party audience data from online, offline and mobile sources to build highly detailed customer profiles. These anonymized customer profiles are then shared with DSPs, SSPs and ad exchanges to customize content, improve targeting and enhance the overall effectiveness of ad campaigns. Data clean rooms offer a secure space for brands, advertisers, media agencies and publishers to merge their first-party data and collaborate without sharing any personal identifiable information. They use techniques such as anonymization and aggregation, and tools such as encryption, differential privacy, hashing, salting and other privacy enhancing technologies combined with strict access and privacy controls.
Develop audience personas and use this information to segment and target your audience
Create an audience persona. Similar to a buyer persona, an audience persona is a research-based fictionalized profile that represents a group of similar people within your target audience. It describes who they are, what they want, their challenges, their interests and how they make decisions. The audience persona will allow you to personalize and segment your marketing and advertising campaigns based on criteria you choose, such as demographics, browsing history, interests and preferences. Taking the time to develop audience personas will ensure you are delivering relevant content.
Tip: Do not use personal information – such as medical, financial, political and other sensitive data – and make sure to adhere to your audience’s opt-out and do-not-track requests.
Iterate and optimize your programmatic ad campaigns
Track performance using engagement metrics such as click-through rates, conversion rates, cost per acquisition and return on investment, and solicit feedback from your audience. Paying close attention to the details and being willing to experiment are essential to achieving success with your digital marketing campaigns. This is where A/B testing comes in. In marketing, A/B testing offers a way to optimize conversion rates by presenting two different versions of a piece of content to two equal-sized audience segments over a specified period to see which one performs better. The data you gather from an A/B test will help you understand what resonates with your target audience and what doesn’t. This information will help you improve the effectiveness of your programmatic ad campaigns and achieve marketing goals.
Keep pace with the latest trends
Social channels continue to evolve and grow – just look at TikTok. Chatbots, machine learning and AI are bringing new insights and efficiencies to marketing. The power of video continues to expand. The regulatory environment around privacy is becoming increasingly stringent as new laws take hold to protect consumers. It’s up to brands to stay informed about the latest industry developments and legal requirements, and to find the right balance between personalized outreach and data privacy.
It’s an exciting time in digital marketing as new, sophisticated tools are improving the effectiveness of marketing campaigns. This increased ability to personalize and target consumers while also respecting and protecting their data privacy is a winning combination: enhancing engagement, driving conversions and building trust and loyalty.
