Worst case scenario sees only one in 10 firms given access to data in post-GDPR era, with digital giants dominating as the cookie crumbles
London: The ad tech industry will see sweeping changes following the arrival of the General Data Protection Regulation (GDPR), and up to 90% of ad tech vendors face the prospect of being denied access to consumer data, according to new research from Smartpipe and PSB Research.
The study of the UK general public simulated three different consent gathering experiences – “Layered”, “Full Transparency”, and “New Entrant” – explained in further detail within the methodology and found:
- When consumers were exposed to the “Full Transparency” experience on publishers’ websites – where they would give consent to each named ad tech vendor – in the worst-case scenario, 50% of consumers consent to a hand full of vendors. On average, only one in 10 (10%) vendors end up with permission for consumer data to be used for personalised advertising
- Consumers were more likely to “opt in” to their data being used by big names – in every scenario, Google and Facebook were the top two vendors – at a minimum they had 28% share of consent, at a maximum they had 54%, highlighting the dominance of digital giants and threatening the future of smaller firms and consolidating the power of the “duopoly”
- In the majority of cases presented, upmarket consumers (ABC1) and older audiences (Baby Boomers) were significantly less likely to grant consent – denying advertisers access to the information of highly valuable target audience. Only one-in-three (33%) Baby Boomers said they would opt-in to cookies, whereas Millennials and Gen Z pushed over 60%. ABC1 audiences have an opt in rate of 49% vs C2DE’s at 58%
- When offered the “New Entrant” experience – non-publishing companies such as mobile phone operators, supermarkets and banks – opt in rates averaged 56% (vs 50% for publishers). But, with the right data protection message from phone companies – stressing investment in innovative privacy enhancing technology coupled with a “no third party” proposition – 83% consented. This signals a significant opportunity for new entrants to supply data into the digital advertising ecosystem
- The allure of the “Layered” experience – a “select all” opt in option – is understandable as the consumer response suggests publishers could achieve an opt in from 80% from audiences. When probed post-exposure, on average 45% of users said they would trust a publisher in such a system, but once they were told they could have agreed to allowing up to 60 third parties access to their personal information, the trust falls to 29%.
The simulated experiences reproduced in the survey were crafted to recreate the different consent collection approaches being deployed for GDPR by different publisher websites. The respondents were prompted to mimic communications with websites about how their personal information could be collected and used, and behave as if they were giving permissions for that website.
“The GDPR was always going shake up ad tech,” commented Chad Wollen, CMO of Smartpipe. “Once you add consumer behaviour into the mix, worse case scenarios are compounded. The three strategic challenges to the use of data within digital advertising which will play out is the “publishers dilemma” of the “layered approach” to consent gathering, the advantages accruing to the duopoly from being large, familiar brands bring, and finally the power of new entrants to keep the flow of data into the ad sector by leveraging new technology and transparent user experiences which offer meaningful choices to their customers.”
Rob Vance, Vice President at PSB EMEA commented: “This is a really fascinating piece of research – we were able to model a number of different scenarios and understand how consumer behaviour is likely to change, based on both the initial framing and consumers’ growing understanding of the issues around data privacy. What is clear is that companies will need to rethink how they approach permissions and start listening to consumers more before taking action.”
PSB conducted 1,204 online interviews among the general public (age 18+) in the UK between 18 and 21 May, 2018, with quotas and weights set to ensure the sample was representative of the overall UK population. To replicate real world scenarios respondents were prompted as if they were visiting websites and asked to consider how they might or might not give permission for the use of their personal information. The scenarios were drawn from actual replications of websites that they visited frequently or rarely, their primary supermarket website, their primary bank website, and their primary mobile operator website.
The three consent user experiences tested were configured to represent the divergent views about collecting consent in the advertising ecosystem today.
- The “Layered” user experience: Favoured by many publishers, this scenario presents the user with three layers of information each with increasing levels of granularity. The “Top Layer” invited the user to say yes to all “third party” ad tech vendors and purposes with a single click or find out more by clicking on “manage settings”. The “manage settings” link took the user to the “Middle Layer” which presented the user with specific purposes, from there the user could agree or move down to the “Bottom Layer” where they were presented with a list of the individual vendors, all of which they could “opt in” at an individual level.
- The “Full Transparency” user experience: This was configured to represent the most fully-aligned GDPR approach. It takes into account both the text of the GDPR and the guidance issued by the ICO on consent, and three Article 29 Working Party documents – Consent, Transparency, and Accountability. Consumers were exposed to the consent value proposition – the how, why and benefits regarding the collection of information for targeted advertising. In that context, they are asked to consent (“opt-in”) on a line-by-line basis each individual ad tech vendor that publisher wants to share their information with.
- The “New Entrant” experience: Moves away from the publisher centric model and tests the ability of other types of company, which have significant volumes of consumers and potentially valuable customer data, to enter the advertising market. The scenario was based on the “Full Transparency” model. For telcos specifically, this scenario also tested the emphasis on state-of-the-art technology to keep data safe, secure and “out of the hands” of ad tech vendors. In this respect, as there were not third parties requesting consent the presentation to customers was significantly simpler and streamlined.
Consumers were shown consent experiences for at least five existing publisher or new entrant brands, consisting of a sample taken from the UKCOM top twenty UK websites or from the telco, supermarket or bank that the consumer stated they actually use or contract with. In addition, each consumer was exposed to different sizes of ad tech vendor lists – three, seven, 12, 29, 41, and 73 (within the “Layered” experience, 12 vendors were consistently presented). The vendor lists were compiled by the actual third party ad tech vendors currently in place across the sample UKCOM website. The order that the vendors were displayed in was randomised.
Smartpipe works with mobile, fixed and Wifi network operators to monetise their first party subscriber data across open digital advertising ecosystems without compromising privacy. By transforming the currency of programmatic advertising – persistent IDs – into non-persistent, Tokenised IDs, Smartpipe’s innovative Dynamic De-Identification technology allows first party data owners to monetise their data in a secure way via the open ecosystem. Founded in 2014 by telco and data industry experts, Smartpipe is the only truly safe and privacy-compliant facilitator of telco customer data profiles, compliant with local and global regulatory requirements.
About PSB Research:
PSB Research is a full-service global custom research and analytics consultancy that connects data-driven insights with human experience to help the world’s most admired brands solve their most critical challenges. PSB Research brings together the lessons from the campaign trail and the boardroom along with a competitive mindset that is fast and focused on getting ahead of the competition. Rooted in the science of public opinion and advanced analytics, PSB Research specialises in providing messaging and strategic guidance for political, corporate, technology, healthcare, entertainment, and government/public sector clients. PSB Research’s operations include over 200 consultants and a sophisticated in-house market research infrastructure with the capability to conduct work in over 90 countries. The company operates offices around the world, with its EMEA headquarters in London. More at www.psbresearch.com.