A very expensive way to annoy strangers
I got a reply to yesterday’s email about tracking in advertising from Kurt (quoted with permission):
That's all well and good, but where does contextual advertising still exist or work? Every platform I look at wants to track people.
First, let’s take a look at what happens when you switch away from behavioural advertising.
In 2020, NPO, the Dutch public broadcaster, switched from behavioural to contextual advertising across all their sites.
Unsurprisingly, they expected a drop in revenue/clicks.
The opposite happened. It went up 62% in January then 79% in February compared to the year before. [1]
Why did this happen? Well, once they cut out all the tracking infrastructure, all the middlemen disappeared along with it. Every Euro went to the publishers pocket instead of being siphoned off by ad exchanges and other intermediaries.
Something similar happened with the New York Times. When the GDPR came into effect, they decided all the extra hassle needed to deal with consent wasn’t worth it and they switched to contextual advertising for visitors from Europe. Revenue didn’t drop at all. [2]
A study of millions of advertising transactions tended to confirm this. It found behavioural advertising only increased publisher revenue by 4% but increased advertiser cost by 500%. Once again, the intermediaries were the ones making bank. [3]
So, can you still find contextual advertising?
Yes. Seedtag, a Spanish company, does exactly that and is growing exponentially. DuckDuckGo is profitable and only relies on contextual search ads. As mentioned yesterday, newsletter sponsorships or podcast ads are basically contextual too.
However, if you want to advertise on sites like Facebook or LinkedIn, you’re stuck with tracking for the moment. And the reason it feels like all these platforms want to track people is because that’s where the gold is for them – not you.
Just beware of the fancy dashboards all these services offer you with lots of vanity metrics like impressions and clicks. Those don’t necessarily correlate with actual business outcomes (for you anyway)
Colin
[1] https://brave.com/blog/publisher-3rd-party-tracking/
[2] https://digiday.com/media/gumgumtest-new-york-times-gdpr-cut-off-ad-exchanges-europe-ad-revenue/
[3] https://www.eff.org/deeplinks/2019/06/research-shows-publishers-benefit-little-tracking-ads