BackAdvertisers can survive the end of behavioural aiming
Last week, The New York Times reported that Meta has been fined $414 million by the EU
PremiumLast week, The New York Times reported that Meta has been fined $414 million by the EU. Regulators found Meta had illegally forced users to effectively accept personalized ads. According to the report, this decision is one of the most consequential issued under the EU’s landmark data-protection law and creates a new business headwind for the social media giant.
Targeted advertising was one of the unique offerings of digital marketing . Backed with ‘cookie’ technology that made it easy to record one’s behaviour in the digital world, advertisers created hyper-detailed data profiles of their target individuals. The personal information thus collected gave them the power to serve ads with pinpoint accuracy based on a user’s behaviour. This became the vital pillar on which many tech giants built their hugely profitable business models. As compared to the ‘spray and pray’ approach of traditional mass-media advertisements, the behaviour-targeted strategy of the digital marketer was a huge improvement. But now this business model is clearly under threat.
A few months ago, Apple gave iPhone users the ability to choose whether advertisers could track them and provided all its users an easy option to opt out. For companies whose business strategy depended so much on collecting personal information on each user, it was a body blow. Apple’s new strategy is estimated by some to have caused Meta an ad revenue loss of more than $10 billion.
The direction of today’s trend is very clear: the privacy of the individual matters much more than the business interests of major tech companies. This paints a gloomy picture for all persuasion professionals focused on behavioural targeting. Where does the vast digital marketing industry go from here?
Traditionally, the pervasiveness of advertisements was always linked to the context in which the advertisement was being viewed. It was always believed that if there is a good fit between the content of the advertisements and the editorial content that an individual is reading, the ad message’s effectiveness will be higher. So brands linked to sports always preferred advertising exposure on the sports pages of newspapers. They even paid a premium for it. Editorial content was a major determinant that drove advertisement placement. To build the new future of digital marketing, one will have to adopt key learnings from the content-based placement strategy of the traditional advertising world.
In existing strategies adopted by digital marketers, the focus is only on the target individual. There has been very little focus on the environment in which that particular person is. But it is a sound strategy to believe that if one is reading material on a specific topic, that person is likely to have an interest in that subject. Ads that are related to the content of that page will be more effective in that context. This approach of contextual targeting describes a way of delivering messages that are primarily shaped by the context of the online environment in which ads are viewed. When Dutch broadcaster NPO decided to abandon tracking the personal information of users and switched to ads based on context alone, revenue increased 61% over the previous year’s.
Technology companies will now be forced to do analytics of their editorial content . It is safe to assume that those interested in a particular kind of editorial content will share some common behavioural characteristics. This could help marketers develop creative content that is appropriate for those behavioural segments. Artificial Intelligence could be used to help develop creative material and also place those ads in a suitable editorial environment.
With a new focus on editorial content as a determinant of advertisement placement, rather than individual targeting, the issue of individual privacy would be taken care off.
This strategy has another advantage too. Humans have multiple identities. Each individual dons an identity based on the context the person is in. One can safely assume that the identity of a person while reading sports-related content is quite different from that when the same individual is searching for a home loan, for example. A content-based online advertising strategy would help create appropriate stimuli for each separate identity of an individual—in multiple contexts.
Even as consumer privacy rules threaten to destroy a closely-targeted advertising strategy, there is another option marketers can use to create more effective ads. Human nature has evolved over hundreds of millennia and there are many behavioural traits inherited from other living beings over millions of years. These behavioural traits are innate to all human beings anywhere in the world. For example, all humans judge speed of an object only with respect to a reference point. Based on this insight, white lines were painted ahead of accident-prone spots to help vehicle drivers judge the speed of their vehicles better and reduce accident rates. Such stimuli based on universal human insights will work for all target audiences anywhere. When privacy issues curtail the ability of marketers to get individualized behaviour insights, marketers could focus on unearthing universal insights that work very well for all individuals.
Thanks to privacy concerns, it could soon be curtains for the much-vaunted behaviour-focused personalized advertising strategies adopted by digital marketers. To move forward now, digital marketers will have to look back at traditional context-based advertising models and human-behaviour insights from millions of years ago.
Biju Dominic is chief evangelist, Fractal Analytics, and chairman, FinalMile Consulting.
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