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How to Tell a People-Based Provider from a Pretender

*This article originally appeared on MarTech Advisor.

The digital advertising ecosystem is well known for its abundance of buzzwords and acronyms, and new terms seem to crop up quarterly. Within the last two years alone, header bidding, native advertising, and virtual reality have all become trending topics. But the industry tends to move so quickly that it can be hard to keep up.

A prime example of this is when the market shifted its focus beyond real-time bidding to the broader trend of ‘programmatic media buying.’ Many within the advertising industry were guilty of using these terms interchangeably. To use “programmatic,” “automation,” and “RTB” interchangeably is inherently incorrect, but it continued to happen long after the actual definition of these terms were seemingly well established within the market. History tends to repeat itself, and people-based advertising is now facing a similar phenomenon.

People-based advertising has become the latest ad tech term du jour, with companies claiming to have the capability in an effort to stave off their own irrelevance. If a vendor owns zero data, operates zero consumer-facing brands, and thus has zero meaningful people-based assets, but claims to take a people-based marketing approach, they might as well say they’re a VC with no capital to invest. It’s a shallow and almost untrustworthy claim, and it should be a cause of concern for brand marketers – similar to how programmatic was before.  And if history is our guide, it will get worse before it gets better.

For example, in the early days of advertising automation, there were numerous companies claiming that they were executing media buys programmatically even when the bulk of their technology still required significant amounts of manual labor. We’re seeing the same industry disconnects that happened to programmatic now, and it’s creating challenges and confusion.

The industry is moving quickly, and that puts the ad tech space in a precarious position, moving away from the simple act of targeting anonymous browsers and embracing strategies that emphasize audience insights and accountability. This shift towards a more data-driven, people-based approach has happened quickly, which explains the lack of clarity and companies who disguise themselves as people-based when they’re not. All of this is happening while fraud and viewability take center-stage. The ad networks and DSPs whose only ‘assets’ were optimization algorithms are feeling the pinch at unprecedented rates, as Facebook and Google now receive 85% of every new digital dollar. As clients begin to expect more from measurement and attribution to drive success, this will get worse—most of the LUMAscape is in trouble.

So how can you identify a real people-based solution from the pretenders? For beginners, does your provider have direct relationships with consumers and the consent to deliver them personalized advertising you can measure? If they’re using a data partnership or data co-op for 1st party data, what is the consent process and is your brand being protected from indirect or portable opt-ins that could draw the ire of the FTC?  If the information is anonymized, can you link it to offline sales and other important data points without modeling? In the absence of operating online properties, how do these companies deterministically link offline data to online consumers? If you are not confident in the answer you get from your partner for any or all of these questions, then you are not dealing with a true people-based provider.

Delivering on the promise of people-based marketing at scale requires an opt-in and a registered user base that is large enough and addressable enough to support the function. This is not insignificant. In fact, you can count on two hands the companies that actually have this type of registered user base.  Rather than marketing to browser cookies and attempting to connect the dots, a marketer can create a persistant and consistent dialogue with a known person across all their devices and then measure the efficacy of that dialogue in real business terms – not narrowly defined online KPIs.  An effective application of people-based can increase a brand’s shareholder value, not just decrease it’s online eCPA. That’s ultimately the win.

As an industry, we all know the future of ad tech is heading towards increased speed, accuracy, and smarter measurement that will help drive improved cross-channel marketing. On the day when every brand marketer has a holistic picture of their target audience enabled by first party data, we will begin to realize the future that people-based can deliver; an advertising ecosystem that moves closer to true cross-channel strategies that drive results and enable direct relationships with consumers. This is the common ground that the industry must achieve, and I’m confident we’ll get there when we have a shared understanding of people-based and a real focus on its innovation and strategic implementation to maximize what it can deliver.

  • #ad tech industry
  • #advertising trends
  • #deterministic data
  • #first party data
  • #people-based advertising
  • #programmatic advertising
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