Privacy-forward Digital Marketing Can Outperform Traditional Models

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When it comes to digital privacy, there’s always a trade-off. Less consumer tracking means fewer opportunities for targeted promotions. More regulations can lead to greater financial costs but also decreased chances for data breaches and consumer fraud.

The results of a new campaign by Brave Software and Dentsu International show that digital privacy might not be the monolith that it’s thought to be, and that advertisers can still generate a positive ROI on their campaigns without sacrificing consumers’ online privacy. 

Brave Software and Dentsu International recently partnered on an analysis of three digital campaigns to compare how Brave’s privacy-preserving tactics compared to those of publishers with more traditional ad models. Brave’s model involves serving ads to “ad choosers,” which are consumers who have indicated they are open to receiving online advertising on their own terms. The company currently has more than 25 million monthly active users on its digital ad platform.

In the campaigns that were selected, Brave and Dentsu measured pre versus post campaign on key branding metrics. Those results were then compared to other pre/post brand lift studies that the companies conducted across more traditional online advertising platforms. Based on Dentsu’s analysis, campaigns on the privacy-focused platform showed a 26% lift in ad recall compared to another digital campaign and a 38% lift in likelihood to subscribe.

Dentsu’s Vice President of Director of Innovation and Activation, Amy Siegel, says the analysis shows that it is possible to not only break through to privacy focused “ad choosers,” but also to positively impact brand consideration at the same time.

“With the demise of third-party cookies and increase in privacy policies across platforms, finding ways to reach our target consumers and engage with them on their own terms will be key to the success of our marketing endeavors,” Siegel says.

Siegel isn’t surprised that the Dentsu campaigns that targeted opted-in consumers had such positive outcomes, particularly because Brave’s users are rewarded for their attention to ads.

“Users have raised their hand to opt-in to receiving advertising on Brave, so naturally they will be more receptive to the messaging in non-surveillance-based media than they are with more traditional ad models they haven’t specifically chosen to engage with,” she says.

Without individualized tracking, advertisers search for opportunities

While there’s little doubt that the absence of surveillance-based media products has an impact on key branding metrics, particularly with the elimination of third-party cookies from the digital advertising ecosystem, advertisers and publishers are finding new opportunities to connect and engage with consumers in today’s market. 

One way they’re doing that is by leaning into the latest privacy regulations, rather than fighting against them. Third-party cookies are being phased out by Google, and data privacy regulations like the European Union’s GDPR and California’s CCPA are limiting what data websites can collect. Brave Ads is just one of a number digital advertising platforms that now rewards consumers for opting-in and engaging. 

At Adswerve, a company focused on Google marketing and analytics, Head of Innovation Charles Farina says he’s already seeing advertisers beginning to make adjustments as they come to adopt a privacy-first approach. Becoming a leader in privacy in 2021 gives certain brands a head start as they work to build trust with their customer base, and that could translate to more traction and greater ROI.

“To build a more symbiotic relationship with consumers, advertisers and marketers must shift their focus to gathering first-party data to inform their brand strategies,” Farina says. “This will drive better business outcomes for advertisers and marketers by understanding the upselling opportunities with [first-party data].”

While there will always be a trade-off when it comes to consumer privacy in digital advertising, more advertisers are coming around to the idea that individualized tracking is on its way out. That’s particularly true now that Google has announced its plan to stop using or investing in tracking technologies that identify web users as they move from website to website. Although Google can’t force advertisers to radically change their approaches, the company’s oversized role within the industry at large means it does have a level of influence that no one else can match.

“Google has essentially said that their ad platform and business is going to move away from the open web. The company’s plans to stop targeting ads based on browsing history will create an even deeper chasm between advertising campaigns on this particular ‘walled garden’ and the rest of the open web, and surface an even deeper need across the ecosystem for ways to merge the two,” says Tom Richards, global product director at MiQ, a programmatic media firm.

Selling consumers on data collection is becoming even more important as data dries up and competition gets tougher.

“[Google’s] making clear the value exchange to consumers will become increasingly important,” he says. “If the rest of the adtech ecosystem can enable that consumer opt-in, there will be a huge opportunity that comes along with that.”

Failure to comply means more than poor performance

In the privacy-compliant digital campaigns analyzed by Brave and Dentsu, consumers received ad notifications only after opting-in to Brave’s program. The campaigns leveraged ads across mobile and desktop to direct users to social platforms to “join the conversation” about specific brands and promotions.

As the consumer privacy landscape firms up and the lines become clearer, it’s likely that advertisers that still choose to run traditional campaigns could have more problems than just poor performance. Regulations like those passed in California and Virginia are having a major impact on vendor relationships. Companies that don’t publicly confirm that they won’t try to reverse de-identified data could be subject to fines and other legal troubles.

“Because of the upfront work that advertisers and marketers have done to comply with CCPA, some companies are already well prepared for CDPA and upcoming legislation at a state or federal level,” says Farina. “However, this web of state laws is creating some difficulty in navigating the specificity of each law, rather than complying with regulations at a federal level.”

Measures like the CDPA, CCPA, and GDPR disproportionately hurt smaller publishers and smaller businesses, and there is a concern that some of the privacy regulations that were put into place to do good could ultimately have the downstream effect of creating more impersonal consumer experiences. 

“Most people think of ‘advertisers’ as big headless corporations and digital advertising as this sinister dark art. But it is an ecosystem — businesses of all sizes depend on online advertising and through it, they are able to bring more choice and innovation to their markets,” says Luke Taylor, Founder and COO of TrafficGuard, a company that detects and reports on digital ad fraud.

Even once third-party cookies are eliminated, Siegel and other industry insiders say there will always be ways for brands to respectfully connect and engage with audiences online, without sacrificing consumer privacy in the process.

“Brands should continue to seek alternative solutions and work with platforms that are ahead of the curve,” Siegel says, “while finding opportunities to incentivize target audiences to engage in a way that won’t be disruptive to their user experience.”

Stephanie Miles is a senior editor at Street Fight.

Stephanie Miles is a journalist who covers personal finance, technology, and real estate. As Street Fight’s senior editor, she is particularly interested in how local merchants and national brands are utilizing hyperlocal technology to reach consumers. She has written for FHM, the Daily News, Working World, Gawker, Cityfile, and Recessionwire.