Why Don’t We Just Ban Targeted Advertising? (2020)

Targeted advertising is a way to sell unused inventory on smaller sites. Large sites can still afford to do direct-deal ads, showing huge banners on the top of cnn.com because they have a diverse enough set of users that the advertiser doesn't particularly care who sees it. Smaller sites need targeted ads because the margins are incredibly thin without them. Smaller sites also don't have dedicated ad buying teams, and so they use the open ad exchanges to fill unsold inventory at an auction. Without ad targeting, the prices at auctions would be much smaller. Like it or not, targeted ads and the open source exchange ecosystem is what keeps smaller publishers from getting swallowed up by the big boys

Targeted advertising has existed in some way since we invented advertising. Knowing that certain people (e.g: rich vs poor) are more likely to live near a certain billboard informs you whether or not you should buy a billboard there. Nielsen has been collecting data on TV watchers since the 1950s and that informed the TV networks which timeslots and on what channels they should advertise on, and what they should pay.

We need to have laws on how we target advertising. Reddit, for example, allows you to target ads to specific subreddits, rather than users. Most people are fine with this idea, since it doesn't require reddit to know anything about the user, just about what page is the user on. This kind of targeted advertising is the most common, as sites will share information with ad exchanges on the type of content which is available on their site (rather than having to track the user themself).

Previous discussions:

- https://news.ycombinator.com/item?id=22662856