If you are a publisher that depends on advertising dollars to fund your operations, data leakage is a critical threat to your bottom line. If you remember nothing else from this post, remember this – data means audience, and audiences are what advertisers pay to reach. If they can reach them without buying expensive content adjacency, they will.
Reaching a specific audience used to be hard. Really hard. That’s not to say you couldn’t buy it – any number of vertical publishers were happy to sell you millions of impressions if you wanted, but needed deep pockets and what advertisers want most after reaching a target audience is to scale it to the hilt for the lowest possible cost. Anyone who doubts that can look toward the meteoric rise of ad networks and programmatic exchange buying, which has rocketed to a double-digit chunk of the display industry spend in just over a year. Cost is a major factor in driving that.
That’s not to say expensive sponsorships and content adjacency are stupid or a waste of money, far from it – but content adjacency is usually a proxy for an audience, reached at scale in an operationally efficient manner, in the right frame of mind to drive brand awareness and brand recall. Splashy sponsorships and content adjacency are what we call top of the funnel strategies, and they are expensive because it is incredibly difficult to attract a large audience looking to research a certain brand of car, or an HDTV, or their 401K allocation. Vertical sites can charge a premium because it is not easy to build a deep, engaged, and reliably large audience. Advertisers are very aware of this.
By allowing advertisers to cookie users via pixel fires out of an ad tag, publishers are enabling their clients and ad network partners to remove them from the value chain. If an advertiser can build a cookie pool on a publisher’s audience, it can readily retarget that audience for a much lower cost on the ad exchanges by using either a DSP or an Ad Network. From the advertiser perspective this is a great way to extend reach, lower costs, and drive ROI. The benefits are so great that it would seem absurd not to try, as if the publisher had simply left an unattended briefcase full of money outside the agency’s door. Publishers without a way to secure their data are pretty much asking to have their audience filtered away from them.
A cookie pool on the loose has a number of negative impacts – first, it erodes the value of the publisher’s audience by allowing advertisers to access it through cheaper channels. Publishers make enormous investments in technology and quality editorial to attract their audiences, which eventually becomes a competitive edge. There is a long list of vertical publishers that have cornered the market in their chosen topic over years of hard work, and a marketer willing to pay premium CPMs to reach that audience is the reward. If the advertiser doesn’t need the publisher to reach that audience any longer, that audience is suddenly worth less. The audience is everywhere, on thousands of sites. It is no longer Publisher X’s Unique Audience, it is CookiePool123, it is a commodity.
Finally, from a technical perspective, data leakage potentially exacts a huge cost on your site’s user experience through page latency. All those third party ad pixels take time to execute, and in many cases may not work through an iFrame tag, meaning they must finish before the page content can continue to load. At 20+ms for each call in addition to the time it takes for your ads to load, it doesn’t take much to make for a sluggish site from the user perspective. Anyone will tell you slow pages degrade almost every major site metric, not to mention can have a significant impact on SEO rankings. Chew on that for a bit!
So what can a publisher do? Read Next – Managing Data Leakage and find out.