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Big Data, Ad Tech, and Privacy Concerns: How The Digital Advertising Industry Can Boost Transparency

  • By Jonathan Buckley
  • April 2, 2015
 

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Big data is a game changer for the digital advertising industry. Thanks to powerful big data tools, digital advertisers can analyze mountains of insight-rich data from multiple sources, enabling them to deliver online and mobile ads to consumers that are more personalized and targeted than ever before.

This new era of data driven marketing is a win-win for advertising agencies, Ad Tech providers, clients and consumers. Still, while all accept the fact that the advertising game has changed, privacy concerns among consumers about data collection and usage and questions from clients as to how their ad dollars are being used to build their brands, call for the ad industry to “pull back the curtain” with respect to its big data dealings. To that end, here’s a look at some of the ways the digital advertising industry as a whole can boost transparency.

Narrow the Ad Tech / Ad Agency Gap

The big data boom has given rise to a plethora of advertising technology vendors touting the latest tools and software solutions that ad agencies can use to better deliver, display, and target online and mobile ads to consumers. The problem is that while Ad Tech companies feel right at home in a mostly left-brain big data environment, this world of numbers and automated processes is largely foreign to the right-brain creative types found in digital advertising agencies.

This has created a gap between Ad Tech vendors that use big data tools to boost ad performance and advertising agency execs that like the increases in clicks and conversions but have no idea what’s causing them. As a result, not unlike the shift in the fast food industry created by consumers who demand more detailed information on what they are eating, ad agency CMO’s now want Ad Tech vendors to tell them how the “sausage” is made.

In an effort to make what they do more transparent, Ad Tech vendors are finding ways to integrate big data processes with creative components in an open data environment. Where opaque barriers once existed, dashboards now reside, giving all stakeholders real-time views of ad performance. Thus, Ad Tech vendors and ad agencies can more fully collaborate, combining big data processes and creative processes synergistically to achieve better results.

Break Barriers Between Agencies and Clients

Lack of transparency between digital advertising agencies and the clients they serve can result in a barrier of mistrust that must be broken down. In this era of big data, clients may not understand the technology used to drive ad performance, but they do understand that there are metrics to measure it. As a result, clients are demanding a more transparent disclosure and explanation of all advertising costs and fees that they are being charged. Clients also want a full and honest accounting of what sites their ads are showing up on, how those ads are being seen, and how they are doing. Agencies that skew data to show more favorable results, fearing that a full disclosure of everything will give clients the upper hand to squeeze their profit margins even tighter, will eventually be shown the door. To gain and maintain good clients in the future, transparent communication on the ad agency’s part is a must.

Ease Consumer Data Privacy Concerns

According to recent Pew Research, 91 percent of Americans feel that consumers have lost control of how their personal information is collected and used. This concern is understandable. While it may seem cool and convenient at first to have ads for the exact things we’ve been searching for online start popping up on social media and other sites we visit later, it’s hard to dismiss the fact that those ads only showed up because our every online move is being watched, tracked and monitored.

Most online consumers will admit to providing all of this personal information freely as they interact on the web. Still, many are beginning to seek greater transparency regarding the type of data that is being collected, how it’s being stored, and most of all, what it is being used for. As these concerns escalate, companies that collect personal data for advertising purposes will gain greater consumer trust by being transparent about what they do with it. In addition, allowing consumers to opt out of part or all of the collection of data is likely to build even more trust.

Big data is transforming the digital advertising industry. Ad Tech vendors and digital advertisers that strive to deliver relevant, personalized, and targeted ads to consumers while adopting more transparent and trustworthy data practices stand to gain substantial competitive advantage and long-term profitability.


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