Publishers are no longer choosing between data utility and privacy to increase their bottom line

Travis Clinger, senior vice president of addressability and ecosystem, LiveRamp

Content is not free, and while publishers have always known this, consumers only came to fully understand the fact when their favorite online publications shifted to increasingly subscription-forward models over democratized open-access content and a primary reliance on advertising for revenue. 

Another misleading narrative is that publishers need to compromise between maintaining consumer privacy and achieving their desired business outcomes. Without the support of third-party cookies to maintain and grow their revenue, first-party data is critical for both publishers and advertisers, especially since not every property can move to a paid subscription model.

Publishers need to build relationships with their audiences that they can then connect to advertisers. Companies must also simultaneously architect internal systems around data custodianship to protect consumer data. In fact, consumer privacy and business outcomes are closely correlated in a complementary way. The companies that champion consumer privacy and work to create a sustainable omnichannel ecosystem that drives better results for every constituent will be the winners, now and in the future.

When consumers trust a brand’s, advertiser’s or publisher’s intentions, they are more willing to authenticate themselves through actively logging in with their phone number or email. Building that trust, however, requires a commitment to developing positive brand interactions and guiding language that clearly explains the value exchange — providing personal information in exchange for better experiences — allowing people to signal both what they want and what they don’t want.

To make this a success, brands and publishers large and small can take three important first steps toward a consumer-first future.

For publishers, putting privacy at the core of data utility is essential

Publishers use data to connect relevant content to the right people, offer first dibs on discounts or early access to new offerings. In the future, the true innovators will be those who place privacy at the core of data utility. Technology used for consumer authentications to connect publisher data with marketer data must be rooted in a trusted value exchange and be privacy-forward.

As the backbone of the open web, publishers may consider tactics that claim to offer the allure of scale but don’t pass the sniff test when it comes to privacy. 

For example, publishers should be wary of anything referred to as “probabilistic signal identity.” If it involves unauthenticated elements being pieced together to create a new identifier, it’s likely fingerprinting — pooling a set of signals from various user-device settings and characteristics such as screen resolution, operating system and model to create a “synthetic” ID in place of a cookie — and therefore lacking a privacy-centric approach.

Authentication leads to better customer experiences and increased inventory

Publishers who lean into the consumer value exchange will authenticate more users. Consumers who trust a publisher enough to provide an email or mobile number tend to be heavier users — and more engaged users deliver higher CPMs. Even with authentication rates starting between 10% and 30%, the impact can be disproportionately valuable. If authenticated users consume more content on average, they can deliver more page views. 

For example, a DTC brand running a campaign buying RampID inventory saw an 82% lift in ROI and Microsoft Advertising CPMs increased by over 40% with ATS — a win-win for all players in the ecosystem with higher CPMs for publishers and better ROAS for brands. 

It’s important that publishers also provide authentication experiences that present people with clear options. Participation shouldn’t be seen as a requirement. Earning trusted relationships with consumers is a real benefit, and the ability to personalize experiences and grow those relationships is even stronger. Microsoft Advertising conducted a series of research studies in 2019 on the importance of trust when it comes to brand love and loyalty. The research showed that 85% of people only consider purchasing from brands they trust, indicating that a privacy-conscious and transparent approach is the only path toward building brand love and long-term loyalty. 

It will take time for publishers and brands to move to this new way of monetizing inventory and connecting with consumers. Forty percent of the world is already cookieless, so to start benefiting from increased authenticated CPMs, publishers should begin to layer in authentication capabilities to build first-party relationships now. 

Building better customer relationships to rival the data networks of walled gardens

In 2020, over 50% of all ad dollars flowed into walled gardens in the U.S. The widespread data fragmentation and the complexity of how data is used are prompting advertisers to seek out simple-to-use addressable solutions that deliver strong results, and the walled gardens have effectively built addressable audiences of consumers who have shared their data. Organizations outside of Big Tech and across the open internet can learn from the walled gardens and build stronger consumer relationships through meaningful experiences. 

Brand and consumer interactions based on authentication and consent provide the opportunity to prioritize privacy and simplify media planning, buying and measurement. They also enable the fortification of meaningful connections across the digital supply chain.

During the past year, changes in the advertising industry have, and will continue to have, a long-lasting impact on all members of the ecosystem. If the goal is a more sustainable, healthy and competitive open web that works better for everyone — prioritizing consumer trust and transparency is not only ethical but essential. With authenticated inventory, publishers don’t have to choose between enhancing consumer experiences and maintaining or even increasing the bottom line.

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