Reflecting on ALM 2023: It's Time For Us to Own Data Privacy Decisions

The 2023 IAB Annual Leadership Meeting (ALM) was another seminal event, where leaders from around the ad industry came together to debate how we’ll respond to the pivotal topics that are top of mind for us all. This year the hottest discussions were about the future of privacy and ad targeting, what that means for success in the rapidly evolving marketing ecosystem, and how we measure and define success going forward.

In talking with colleagues old and new, one of the biggest benefits coming out of the ALM was a collective realization that the industry is not doing enough to proactively define a forward-looking solution that empowers consumer privacy control, while also enabling the personalized value-add experiences that patients and healthcare providers have come to expect. Many advertisers are going to be found holding the bag.

There was a tangible feeling that the industry at large is waiting for an answer to be thrust upon them from the likes of Meta and Google, rather than proactively coalescing around a broader industry-led solution. To borrow from a concept that Karthik Rao, CEO of Audience Measurement at Nielsen discussed in the panel about Nielsen One, the paid media industry needs to stop playing the ostrich and get its head out of the sand to create a single interoperable “currency-level solution.”

In healthcare, control of personal health information—including related digital behaviors—rightfully belongs to the patient. Relying on companies like Meta to do this the right way is a bit like expecting the fox to dutifully guard the henhouse.

LiveRamp defined 3 key areas that must be addressed:

  • Property rights (who actually owns personal data)
  • Portability (how access to that data should be granted and transferred across advertiser ecosystems in an empowering and facilitating manner)
  • Permissions (how control and access should be granted and streamlined)

While the proverbial GPS will have to ‘recalculate’ along the journey as we collectively iterate and pressure test solutions, Spectrum Science is advocating for the next step in this evolution to be centered on developing and testing meaningful support of browser-level “Data Passports” that can enable data to pass through “clean rooms” from one 1st party environment to another. Specifically, we see value in this approach for the following reasons:

  • Empowering individuals with the ability to own their data and revoke, configure, or deny access as they see fit will inherently provide the personalized experiences consumers want, while reducing repetitive and confusing barriers to digital content
  • In today’s media climate where transparency is king, browser-level Data Passports with comprehensive consumer data ownership provide value and interoperability by creating a common ‘currency’ for receiving or rejecting personalized marketing

Google and Apple should work with the IAB and other industry leaders to create and test Data Passports or similar solutions rather than continuing to try to repackage existing targeting methods into ever more obfuscated implementations like Google’s FLOCs or Topics betas. Interest category targeting already exists and still has inherent privacy conflicts regardless of whether the consumer is lumped into a cohort or targeted individually, the net result may be generally the same.

The current approach is reminiscent of the 2008 mortgage crisis, where instead of dealing with predatory lending guidelines, all of those subprime loans were just repackaged into complex mortgage-backed securities and derivatives to obfuscate what was actually happening. We’ve all witnessed what happens when we only treat the symptom, rather than tackling the disease.

Regardless of where the industry goes, it underscores the critical importance of moving beyond myopic conversion or traffic goals and rooting marketing and advertising expenditure, media mix, and conversion value in Customer Life-time Value (CLTV), rather than individual metrics that are impossible to accurately measure across devices, browsers, cookies, and the real world.

We’ve already been implementing versions of this intermedia approach at Spectrum with significantly elevated outcomes. For example, for one of our clinical trial advertising clients, we were able to achieve a 29% patient referral to enrollment rate with targeting quality so high that only 4% of patients from our campaign didn’t pass clinical screening.

When you have your own opt-in audiences to nurture, they are known to you, and this is how your brand can realistically move from probabilistic to deterministic data that can produce directionally accurate attribution and media mix models. It seems silly that clients and agencies alike relied so heavily on black-box data and models in the first place.

This is particularly important in branded pharma advertising where metrics like ad driven NRx already requires a probabilistic approach based on some form of lift analysis. While 3rd party cookie deprecation has been delayed, eventually the clock will strike 12, and healthcare brands must be ready.

The best thing brands can do to prepare is to elevate their paid media campaigns to the objective of building their own 1st party audiences, with the goal of bringing patients and providers into a living intermedia ecosystem. By breaking down the siloes between paid media, CRM, and digital content/UX strategy, brands can create closed loop marketing based on the lifetime value of a patient or HCP, maximizing ROAS.

This strategy is both protective and opportunistic. Not having an aggressive approach to gathering 1st party data and meaningful ongoing customer engagement strategy is not just a risk, it will be fatal to successful marketing efforts in the new digital marketing economy once the fast and easy times of 3rd party cookies come to their inevitable end.

This article orginally published on LinkedIn by Chad Childress, EVP of Paid Media. Chad is a member of the Sermo Product Advisory Board, and is cohost and creator of the Marketing Rescue Podcast.

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