Can someone ELI5 to me why we can't simply have ads targeted to content instead of to visitors?
What changed in the landscape that this is no longer possible?
What changed in the landscape that this is no longer possible?
I subscribe to Sound on Sound, a magazine about music technology. I pay them $90 a year, but I also whitelist them in my ad blocker, because the ads complement the content. If I'm reading a review of a synthesizer or an article about how to record electric guitars, it's really easy to serve relevant ads with good click-through and conversion rates without intensive tracking. Both the content and the advertising serve to enhance my enjoyment of a hobby that I care deeply about.
A lot of publishers are really going to struggle post-GDPR, because their content is clickbaity and vapid. It isn't worth paying for and it isn't relevant to the readers' lives. It exists because it briefly hijacks your attention, which can be profitably monetised by ad networks that invasively track your activities online.
Some good publishers are going to get caught in the crossfire which is unfortunate, but I think that the overall effect will be net positive. If publishers can't sell their ad inventory without recourse to surveillance, they need to seriously examine whether their business model is honorable and whether they are offering something of real value.
Yep, I really hope that the law incentivizes businesses to really add value by producing better content rather than turning up the frequency and hitting everybody with addictive clickbait.
I run a critical news blog about blockchains and I get about $200/mo on Patreon on this model. It's not a living, but it's a nice extra indeed.
I am delighted to answer publishers who go "but how can we live without spyware-level ads!!" with "have you tried not sucking?"
(I whitelist a few sites, e.g. LWN.net, and I don't block ads from the Project Wonderful network. If you don't suck, I might let you through!)
Native ads do this. It's a huge industry, and will likely get far bigger under GDPR. But it takes highly specialized techniques to make the numbers back out as an advertiser. There's a ton of fraud, the bidding strategy is very different from programmatic/retargeting, the ads that work are different, etc. Most of the ad industry doesn't know how to do this, and many types of ads simply won't be profitable on native networks.
From what I'm hearing from my friends that do ecommerce stuff, product ads targeted to the EU are no longer profitable across the board either. That will force a ton of review sites aimed at EU visitors to shutdown, along with many YouTube reviewers. As advertisers pull product ads out of the major ad networks because they can't make money, the revenue of publishers/content creators in the product review space will plummet in lockstep. Amazon has cut affiliate commissions to the point where turning to them is no longer an option for any site that costs money to maintain either.
GDPR seems to be on track to wipe out vast swaths of businesses serving the EU market, and not just the "evil" ones it was trying to wipe out. It's a shitshow, but it was entirely predictable.
A situation where your average page contains tens of tracking scripts wasn't sustainable much longer.
If anything, GDPR should be seen as an opportunity to disrupt the quasi-monopolistic online ad market.
The problem is that the market itself is shrinking (as we speak) as a result of GDPR. There won't be much of a market left to disrupt. Ad targeting got as invasive as it did because that was the only way to make it profitable. The moment that ads stop becoming profitable, advertisers will pull out. This won't be gradual thing for most companies - this will be a next week type of thing. Few companies can afford to light money on fire in the form of ad spend if they can't recoup it. Some ads might still work in the EU, but it will be a dramatically smaller market within a month or two.
It might be that big media, everything-and-the-kitchen-sink portals with a large target audience get a cut back, to the benefit of small, focused sites and maybe also paywalled content.
I'd say that could be another welcome collateral effect of GDPR, and give us back the federated Web we lost, though I'm not sure it'll be world-wide any longer given different incentives in US and EU markets, let alone the Chinese and regional (such as Russian and Turkish) markets.
I'm not exactly sure what you mean here. There was quite a bit of money being spent on advertising to people in the EU on May 24th. Due to GDPR, many of the advertisers that were spending this money will no longer be able to make a profit from this activity. They will therefore cease that spend, and the EU online ad market will dramatically shrink as a result. The EU companies that were receiving the money from those advertisers will no longer receive it, and many EU publishers will go out of business.
Some ad-dependent leeches will die off, good riddance. Let others take their place, with a privacy-friendly model.
An analogy here would be someone hating cars' tag readers in public. Law gets passed its illegal, yay! Then 2 months later your car payment goes up 30% and you scratching your head. Yeah well since they couldn't recover enough cars from people who don't pay, they had to adjust their financial models and you are the one to pony up for it.
GDPR will wipe out many niche blogs that make few hundred bucks a month top and - as this article clearly points out - will ironically help companies like Google to make more money and jack up pricing for remaining ads, as the whole ad network will get much thinner.
>"An analogy here would be someone hating cars' tag readers in public. Law gets passed its illegal, yay! Then 2 months later your car payment goes up 30% and you scratching your head. Yeah well since they couldn't recover enough cars from people who don't pay, they had to adjust their financial models and you are the one to pony up for it."
Maybe they should have shown some responsibility, and not just pushed unrealistic loans on every Joe Six-pack who walks through the door.
Also, this culture of instant gratification that advertisers and money lenders have created is truly vicious. It has become culturally accepted to just take another loan to buy stuff you "need" (read: desire, to one-up your peers), never mind the consequences.
Try saving up instead or (shock and horror!) simply doing without the trivial material possession in question. You'll be tired of it in a short while anyway.
>"GDPR will wipe out many niche blogs"
That is purely unfounded speculation on your part.
It's speculation but not unfounded. GDPR will absolutely reduce small publisher revenue significantly, so making the leap that it causes a culling is rational.
I don't know how many those are.
Most blogs I see seem to be run as a labour of love or for content marketing. Anyway, nobody expects to make money directly off the blog.
To the contrary, niche blogs can place content-based banner ads for their audience without targetted advertising because they're much more focussed.
And anyway, the marketing business was already going down, ads became so invasive and annoying that everyone is using ads filters today.
But I don't know why are we talking only about ads. What about people getting some bad credit rates as bank bought the data from ads network? Or things like Cambridge Analytica. Like the marketing and ads world is everything we know of and GDPR isn't bringing any positive effects as it hurts tracking. Tracking market goes down, human freedom and rights + democracy goes up. Who cares for targeted marketing in respect to that.
What I meant is that ad spend for large customers has always been handled such that a budget is handed over to an agency (to the winning one of several ones competing for the budget). That ad spend is allocated to multiple media channels and campaigns; now it will have to find other, more creative ways to get the message across to the customer.
Online ads have been under pressure, and their effectiveness has been questioned for much longer than yesterday when the GDPR came into effect. The GDPR legislation has been a long time in the making, so if publishers haven't prepared for it, then they have only themselves to blame. People have certainly no obligation to sustain a rotten big-data/big-media mindset by giving up their privacy, especially when that only benefits very few.
The situation for publishers has been precarious for many years, so publishers should focus on the opportunities not risks of this change. For example, exactly because clickbait isn't going to be sustainable any longer, quality media might get a boost, and could even make a profit from paywalled content. Holding on to a model that's on its way out isn't a winning strategy.
Performance marketing companies will spend as much as they possibly can for incremental profit, the budgets float based on the results. So the cycle goes:
Worse Targeting -> Lowered Performance -> Lowered Budgets -> Lowered Publisher Revenue
Good. The situation was absolutely unacceptable, and I'm glad the EU decided to shake it up.
It's amazing to me how people manage to fool themselves into thinking there is hope when the world is crumbling around them.
If Google can't make ads profitable in the EU what makes you think some tiny European company will be able to disrupt the ad market?
How would they even do it without tracking? I can see the conversation with major brands now
EU Ad Startup - "Trust us, the ads you are paying for are performing great. We are very confident that they are driving conversions on your website."
Brand- "Ok, do you have any numbers to prove we are receiving conversions due to your ads?"
EU Ad Startup - "No as that would be illegal under GDPR, but please trust our business."
How did the paper and tv industry work? Oh yeah, advertisers would crowd around and bid up the largest players. Small niche products would receive little to no revenue and die quick deaths.
That is what I suspect will happen in the EU. Without tracking Advertisers will be unable to know how their ads are performing. Without metrics such as conversions which require end to end tracking advertisers will need to rely on the reputation of the platform.
Products such as google and facebook will receive significant attention from advertisers. The tiny blog you enjoy reading that is barely scraping by will receive very little.
Yes that's a valid concern. But blogging hasn't been profitable or even sustainable for a very long time now in the way it used to be ten or fifteen years ago, with YouTube, Fb, microblogging platforms, and news aggregators having taken this space instead. Those who keep on running blogs do so for promoting their own services, products, or other agendas, or as a hobby, and will continue to do so. So it's not a terrible loss really; the great starving of blogs has already happened in the past.
But sites such as product review blogs could get a boost by ad money being in need to be allocated in innovative ways. Post-GDRP advertising requires thinking a little bit out of the box, and leaving the "ad" model as we know it behind which isn't very effective to begin with. If you consider attention a scarce resource to compete for, I could imagine ad money going into more and new native advertising sites, temporary sites for local events with direct sponsoring, focused sites for special interests, etc.
The more recent capability of targeting those niche ads also on random click-bait sites didn't exactly help those small niche products.
(Edit, for clarification: with unrestricted tracking, if you publish to a niche with good ad money, the few ads that you do show, for a tiny fraction of the ad budget of your niche, become the information source used for drawing much of your niche's ad money to ads displayed to your audience on unrelated sites. Your ad-network should practically "steal" your content-targeting information to divert on-topic ad money to entirely unrelated sites)
Do you have a link to support that? I believe it, but I'm looking for an article that explains it well. I read one that had a good example of an advertiser basically telling the operator of a high-quality, premium site that he's only going to use them to gather audience targeting information so they can be targeted at cheaper sites.
Maybe you misunderstood what I meant (my wording wasn't exactly perfect), I'm not talking about some dramatic ad-fraud scheme: without tracking-based targeting, all ad-money about scuba-beekeeping (just making up some really small niche) would go to the few sites dedicated to pleasures scuba-beekeeping. This is how Google started their dominance, they were the best at automatically matching scuba-beekeeping advertisers to scuba-beekeeping websites. Content-based targeting.
With tracking, ad-networks show a small, cheap ad (or even just some tracker the site includes without monetary compensation) on the scuba-beekeeping site and take a note that the browser identity a target for scuba-beekeeping. Ads about scuba-beekeeping will now appear to that browser-identity on random news sites and the like while the niche site won't see a cent for the targeting information.
All in all, if the "native" ad market (the one addressable by content-based targeting) of a site has above-average value per eyeball, a site will tend to lose more from cross-site targeting than they will gain from showing ads unrelated to their content (but related to whatever their visitors have visited before), if the "native" ad market is lower then they may win. Visit frequency also plays a role, if the content-targetable sites take only a small percentage of their users' browsing activity, a no-tracking scenario would cause a bidding war amongst on-topic advertizers, if they take a large chunk of their users' browsing, inbound tracking targeted ads (about other topics) could easily more than make up for the losses in on-topic ads.
In the analog world they do this for example via coupon codes which are unique to the ad.
This will severely undercount the number of conversions. It's not atypical for someone to view/click an ad and then purchase at a later date through a different channel.
It was possible to track that before GDPR. It is not possible now.
A reviewer making sales commissions is just a salesperson. Good riddance.
What type of businesses? Do you mean the businesses making vacuum cleaners or the businesses surrounding it like a vacuum cleaner review site?
and nothing of value will be missed
Native ad is just an ad that is formatted so it fits with the aesthetic style of the page, (for example it uses the same fonts and colors). This makes the ad less jarring to the user and makes the overall page look better. Many people don't like them for this exact reason, because they say ads should be very obvious and native ads might look like content.
Native ads can do tracking the same way non-native ads can.
The rest of the comment is more or less spot on though.
Most native ad networks run based on topics, and the ads themselves are usually not targeted to the individual person. I run ads through major native ad networks such as Revcontent. You choose "topics" to target, and then your ad is shown on content that relates to those topics.
2) Tracking user behavior is fairly important to implement click fraud detection- obviously that doesn't justify shady behavior on the part of ad networks, nor does it necessitate the in-depth amount of personally identifying information they may or may not collect. However, some forms of that data- think IP addresses, click history- may be useful.
3) If you already have some data per point 2, why would you waste an opportunity to display something meaningful by putting up an ad that might be completely irrelevant given what you happen to know already?
None of this is meant to justify targeted ads, only to explain why they have better appeal to both content providers and ad networks.
Training for teachers? Security services? Access control systems? Yes, a lot of those reading are parents, not teachers, but what do you think they'll do if they are convinced something exists that will reduce the risk of school shootings?
Editing: ad "targeting" as it has existed so far has also been insultingly, embarrassingly bad IMO. Even Google tried for years to send me ads for Russian, Ukrainian, Philippine and Thai dating sites. Round robin. I was delighted when they started showing me Wordpress ads.
Those are not relevant either but now we are approaching something useful and not actively insulting (I'm very happily married and have small kids.)
I suspect that most advertising is actually driven by supply (that is, somebody wants to advertise X), not demand (somebody needing Y at the moment), and that's why targeting doesn't really work that well, and the disadvantage of untargeted ads (or targeted by content) is much smaller than advertising industry claims.
2) in a vast global experiment where advertisers knew everything about everyone they still completely failed to show people relevant ads. Most notoriously even the giants who know what you ate yesterday fail to realize you probably don’t want ads for toilets for a year after you bought a toilet.
You want millions of people to loose their lively hood over this issue? That sounds cruel and spiteful to me.
You also have to think of many small companies that make niche products that would no longer be able to find their customers and thus be forced to close.
> 2) in a vast global experiment where advertisers knew everything about everyone they still completely failed to show people relevant ads.
The premise of your statement is false, advertisers have never know every thing about anyone. That was just marking bullshit by ad-tech companies targeted at adversities and publishers, "We know everything about your users! So if you hire Acme Ad Tech your profits will go through the roof!" The fact that users hear the statements and understandably freaked out was collateral damage. The fact this statement was demonstrably false was irrelevant.
The fact is that the amount of data used to do targeted advertising is quite sparse in-fact, no-one wants to spend the effort to individually go through mountains of data and figure out the best advertisment. Really the only data used is
1. demographics (age, gender) 2. location (this is so a NYC based restaurant chain doesn't waste money advertising in California), 3. language (people actually hate seeing ads in a foreign language) 4. interest categories (like do you like Football, or Cars, or video games, this is how facebook advertises a lot they figure out your interests based on posts, then allow advertisers to advertise to you based on that category, (interestingly they don't actually sell the list of interests mostly because that would mean advertisers would not have to buy ads through Facebook and more)) 5. product targeting (this is you visited acme.com and put an acme roadrunner trap in your cart but never checked out so now it follows you around the internet.)
> Most notoriously even the giants who know what you ate yesterday fail to realize you probably don’t want ads for toilets for a year after you bought a toilet.
Yeah, that's my point, using more data (like the fact you bought the toilet) is more work and using the current amount of data works well enough for them so that is all they do.
It's completely subjective, which may or may not be a good thing depending on the mood of the regulator, court, and your opinion of rule by common law.
Plus, the editorial quality of ads is generally so awful, so you need to align with the users interests to help them accidentally click on it in many cases.
The newspaper was a beautiful business. They had a monopoly or minimal competition, and a critical mass that supported everything from classified ads to flyers to the pet store.
How likely is a Cosmo reader to be a cis man?
Alternatively: How likely is a Cosmo reader reading an article about menstruation to be interested in a female hygiene product?
The death of tracking-based ad targeting doesn't mean you have to show the same ads everywhere like an animal. You can still make the ads contextually relevant. And you don't even need to disguise them as native content (which, btw, is illegal in some EU countries already).
I’m not comfortable with ad networks deducing those very same parameters from my browsing habits.
Unfortunately short of some type of mandate I don't see how this could work, because it would be next to impossible to get 90% of the population to fallout the cookie.
My company actually did a bunch of research on collecting consent from users to show personalized ads, (aka what everyone is doing right now)
Only 25% of the the users read the 3 sentences before clicking on a selection. 25% did not read anything many thought our privacy dialog was in fact an ad. :(
Many people said they didn't want personalized ads because they thought it would mean filling out a survey like the one you just described even though it obviously (to us) did not.
One person actually said, "I'm okay with them using my browser history to show ads but, I don't want them to use my personal data like my banking records or my medical history." This is very ironic because we presented the option to do exactly what they wanted by they didn't understand what it was because they did not consider the browser data to be "personal".
I really wish that when you first opened a browser their was a dialog about hey these or the things you need to know about how we pay for the internet. Though I have no idea how get to that spot.
This sounds horrible, sorry.
Or you're doing the family shopping and aren't grossed out by hygiene products.
Its only now, after GDPR, that you finally have an option to switch back to content based ads, but sadly "for EEA users" only.
The former is a deeply troubling form of government that leads (in my view anvetiablly) to corruption and abuse of power. The latter is plain backwards Google has the resources to be profitable under any regulatory regime it is small companies that don't.
Now without tracking you have to actually understand the audience and the product, this research will make advertising more expensive but also in many cases have better success.
And suddenly there is no reason to rely on google.