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.
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.
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.
Good. The situation was absolutely unacceptable, and I'm glad the EU decided to shake it up.
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.
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
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.