The advertising industry and tech sectors face a range of privacy and data-protection challenges, following numerous hacks and data-usage scandals that rocked some of the biggest names in ad tech. Brands are increasingly pushing for more transparency and control, while regulators are scrutinizing rapidly evolving marketing models and online advertising practices.
S&P Global Market Intelligence sat down with Paul Wright, CEO of self-proclaimed ‘ethical’ ad-tech company iotec, which counts such clients as InterContinental Hotels Group PLC, Match.com LLC, Medialab, Havas SA and Porsche, to learn more about the evolving digital advertising sector.
Given recent revelations about the use of Facebook Inc. data by third parties, how should advertising agencies and ad brokers handle, share and process sensitive data?
Paul Wright: There are two parts to this question. First, how much sensitive [and] personal information do these agencies and brokers really need? Secondly, do consumers really want personalized advertising in the first place? Just because marketers have the data and technology, does that make it OK? The reality is that marketers can still reach their target audience without using sensitive data.
To what extent should advertisers and tech companies be allowed to track, follow and analyze individuals?
Targeting should only ever be broad and never to an individual level unless there is explicit consent. Any individual analysis is superfluous. There are so many targeting tactics but one of the really uncomfortable ones is psycho-targeting, the targeting of consumers on their psychological attributes. The key to this question is to ask yourself ‘Does it pass the creepy test?’ If the answer is “no,” then you probably should not be doing it. Brands need to think about their consumer and use strategies that are ethical and not use technology to do things that only benefit them. Take digital retargeting and think about this. If you walked into a physical store, looked at a product and left, would you be happy [if that store followed] you outside and kept trying to sell you the product for 30 days?
Who should be checking a brand’s statements and claims for factual accuracy?
We are at a very interesting point at the moment in the difference between the offline world and the online world. Everyone must be accountable in the digital world as much as they are in the offline world. But there is a trend of platforms claiming it is not their responsibility. If Sky PLC were to run a fake TV ad, then they would be fined, no questions asked. So why should platforms not be liable for the digital ads they run if they are fake? The bottom line is if your platform is funded by advertising, then you are a media platform and, therefore, it is your responsibility to ensure all advertisers are legitimate and uphold ethical business practices. It is not like these companies do not have the money or technology to make this happen. Equally, an agency needs to take some responsibility with regard to claims and approaches that may be made in ads or in posts. Each claim needs to be verified as they would be offline.
How should the industry deal with common practices like advertorials or paid-for content, pop-ups or the newer kick-through ads, which ‘kidnap’ a user and take them to another website?
Pop-ups and kick-through ads should not be permitted under any circumstances. I have seen quality publishers handle advertorials well. However, other publishers do not have the same incentives. We must call out bad practice otherwise it will continue to happen as it is. Trust in advertising is at an all-time low, so it is time to do something about it if we want that perception to change. Another issue is that brands often have no control over how and where their ads appear online; brands pulled out from YouTube and Facebook after their messages showed up next to extremist and violent content.
What can brands do to prevent that from happening?
Ad-verification vendors offer products that report on the quality of the content an ad appears on or can prevent your ad from appearing in real time. Good ad-buying platforms will maintain their own filters blocking any ‘known-problem content’ by default, and the best ones will augment this with additional filtering provided by third-party specialists. Brands can also maintain white lists of sites they are comfortable appearing on. Finally, brands can demand transparency on placement from their media partners, asking for a full list of domains and URLs or apps their ads have appeared on.
Blockchain has been widely discussed and presented as the panacea to brands offering full transparency over their programmatic media buying transactions so that all the pesky problems associated with the digital media supply chain will disappear. At this moment in time, it is just not ready. So what are the alternatives? Event data is a natural output of every advertising impression purchased in today’s tech stack, providing a detailed record of each action. All the key players in technology all write or leverage event data. With the data, you know the who, what, where, when and how much for everything that happens across the ecosystem. All you need to do is ask your supplier for the data. If you get “no” for an answer, you may want to ask them why they are so reluctant.
This article originally appeared on S&P Global.