Fixing Digital Advertising for the Privacy Era Requires a Mindset Shift
Fixing digital advertising for the privacy era requires a mindset shift, according to Alessandro De Zanche, a consultant who is helping agencies like Dentsu and premium publishers adjust their strategies for an era of less rampant tracking.
De Zanche told me that advertisers need to focus on investing more in high-quality content to build relationships with consumers of that content in “high-quality environments.” In other words, if you want to reach readers of the New York Times who are primed to trust the media buyers with which they engage while reading Times content, you need to be willing to pay a premium.
On the other side of the equation, top publishers, De Zanche argues, need to become walled gardens. This doesn’t mean they need to hide their data from buyers. But it does mean they need to lean into upfront deals and decrease reliance on the programmatic open market.
De Zanche and I spoke earlier this week. A condensed and edited version of our conversation is below.
Let’s set the scene a bit. Third-party cookies are going away on Chrome, Apple may obfuscate IP addresses on mobile, and Google will likely degrade its ad ID. What else are you thinking about when it comes to privacy changes and advertising?
I don’t think we can classify it as a technical change or just a regulatory change. It’s also a cultural change. It’s an unstoppable trend, which goes far beyond just being compliant in the industry. It’s about building a different mindset and way to engage with audiences.
In the long term, [these changes] will be better for audiences, quality media owners, and advertisers because they’ll bring higher-quality environments.
It’s undeniable that higher-quality digital advertising requires higher-quality environments, and those environments can only exist with self-sustaining media owners who invest in quality content. When I say quality content, it can be news, audiovisuals, games — we need to refocus on the environment.
What do you mean by a high-quality environment?
An issue in the past 12, 15 years has been the media ecosystem being unbalanced. Media owners have struggled. The marketing of the future lies in a better environment, better content, and better data, which means more engagement with the user, which means better transparency and user experiences.
In my view, that can only happen if publishers become self-sustainable and the gatekeeper of these environments. Publishers must work directly with advertisers to give the advertiser the possibility of entering these quality environments and engaging with the audience around the advertiser’s products or services.
This can only happen if media owners and advertisers work together. If advertisers understand the need for media owners to regain control of that environment.
We’ve been obsessed with infinite reach at infinite scale. Media owners have been commoditized. We need to rewind and rethink that kind of environment as one where the content, the context, the engagement with the audience, and data are not decoupled. The value of advertisers lies in this well-rounded environment.
Is the problem, then, over-reliance on the programmatic open market, which slices things up? It’s not like buying a piece of the New York Times audience where you as an advertiser go to them directly and pay a premium for that access.
Yes, and as the advertiser, you’re not only buying a piece of the New York Times audience but an audience that is engaging with relevant, high-quality content. It’s important to keep the user experience together rather than selling in different places.
With [current reinventions of] the programmatic open market, we are trying to replicate the past. It’s not by replicating the dynamics of the third-party cookie that we’ll fix advertising. It’s by rethinking first-party assets, which are the content, the data, and the relationship with the user.
Does this better, privacy-adjusted environment look like premium publishers just selling more inventory upfront?
There are no blueprints that can be applied to any country and any situation. But the future of digital advertising will involve different tiers.
Tier one will be publishers big enough to guarantee enough reach or an alliance of quality media owners that will bring standards together. I don’t mean creating a big bucket of quality media owners. I mean a framework environment with set, guaranteed standards for the way data is collected, consent, the number of ads on a page, viewability, and so on. That is also important for brand suitability and safety. Safety lies at the domain level, not the article level. Either a big enough media owner or alliance of media owners [will need to create] a media garden of standards where the media owner is the gatekeeper and guarantees the experience, compliance, a lot of things that also mean the audience trusts the media brand or brands. That’s the ideal environment for advertisers to invest in with higher authentication, with a registration system.
One objection I always hear at this stage is that if premium publishers break away from the open marketplace, they can have problems with their revenue. [In other words, the fear is that advertisers won’t do business with premium publishers anymore if they step away from open programmatic.] Well, I’d challenge every advertiser not to invest in the top 100 or 200 media brands but in a marketplace with lower quality. [Premium publishers have leverage.]
Tier two could be focused on contextual targeting. The users are more anonymous and may have a less engaged relationship with the media owner. So, that could be where advertisers find huge reach, but still, we need to work very hard on making sure fraud and all the other issues of the past are not a problem with this marketplace.
Reach is serving adtech more than media owners and advertisers.
Has the programmatic open market’s value proposition become unbalanced? Are premium publishers depending on it too much?
Tier-one publishers should be a walled garden. What we’ve seen over the last 10, 15 years is the open marketplace being an environment with millions of websites legitimized by the presence of a few hundred websites whose value is being diluted by other websites with the issues we know.
It’s time to upgrade the quality of the industry. It’s time for media owners to focus on their quality and become the gatekeepers of that environment.
So, elite publishers need to become more like Facebook, not in the sense of the quality (or lack thereof) of Facebook’s content but in the sense that Facebook has established itself as a great place to do advertising on Facebook’s terms, and premium publishers need to exert more control, too?
Exactly. When I say walls, I’m talking about transparent walls, not brick walls. The standards are the walls. By the way, there is a lot of space for good adtech that will focus on the needs of quality media owners and advertisers and will be at their service. [This departs from] one of the main issues of adtech in the past 10, 12, 15 years, which has been their goal of taking over the world and running the whole story without owning any data, producing any content, or having a relationship with the audience. It’s evident we need to change.
What are the steps advertisers need to take right now to preserve targeting advertising capabilities? Seems like a mindset shift is in order.
It’s got a completely different value to engage with a user in a high-quality, trusted environment, as opposed to catching the user wherever the user is.
But it’s not a binary. There are a lot of interconnected needs. Quality advertising can only happen in quality environments, which can only be quality environments if there’s quality content, which requires money. Media owners need to become self-sustainable for that to happen. Advertisers need to push media owners to focus more on quality and signal their interest in investing in quality.
One of the biggest excuses media owners have always put forward is to say they can’t take everything away from the open marketplace because they’ll lose revenue. Advertisers need to help media owners build a bridge toward the new world.
Long story short: the future must focus on three pillars, which are the audience, the media owner, and the advertiser.