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Monthly Archives: January 2019

Pentagon stands by finding of no conflict of interest in JEDI RFP process

January 26, 2019 No Comments

A line in a new court filing by the Department of Defense suggests that it might reopen the investigation into a possible conflict of interest in the JEDI contract RFP process involving a former AWS employee. The story has attracted a great deal of attention in major news publications, including The Washington Post and The Wall Street Journal, but a Pentagon spokesperson has told TechCrunch that nothing has changed.

In the document, filed with the court on Wednesday, the government’s legal representatives sought to outline its legal arguments in the case. The line that attracted so much attention stated, “Now that Amazon has submitted a proposal, the contracting officer is considering whether Amazon’s re-hiring Mr. Ubhi creates an OCI that cannot be avoided, mitigated, or neutralized.” OCI stands for Organizational Conflict of Interest in DoD lingo.

When asked about this specific passage, Pentagon spokesperson Heather Babb made clear the conflict had been investigated earlier and that Ubhi had recused himself from the process. “During his employment with DDS, Mr. Deap Ubhi recused himself from work related to the JEDI contract. DOD has investigated this issue, and we have determined that Mr. Ubhi complied with all necessary laws and regulations,” Babb told TechCrunch.

She repeated that statement when asked specifically about the language in the DoD’s filing. Ubhi did work at Amazon prior to joining the DoD and returned to work for them after he left.

The Department of Defense’s decade-long, $ 10 billion JEDI cloud contract process has attracted a lot of attention, and not just for the size of the deal. The Pentagon has said this will be a winner-take-all affair. Oracle and IBM have filed formal complaints and Oracle filed a lawsuit in December alleging, among other things, that there was a conflict of interest by Ubhi, and that they believed the single-vendor approach was designed to favor AWS. The Pentagon has denied these allegations.

The DoD completed the RFP process at the end of October and is expected to choose the winning vendor in April.


Enterprise – TechCrunch


3 lead generation tips for ecommerce businesses

January 26, 2019 No Comments

When we hear the words “lead generation,” our minds automatically conjure up a B2B marketing strategy aimed at filling the top of the sales funnel. But leads are not exclusive to B2B companies.

Every type of business, be it wholesale, retail, startup or whatever else, needs qualified “potential” customers who can be nurtured into actual paying customers. Ecommerce is no different.

With the barriers to starting an ecommerce business tumbling faster than you can say Jack Robinson, the ecommerce industry has become competitive like never before.

Besides new competitors mushrooming every day, there is the entrenched Goliaths – Amazon – which will eat away close to 50% of the market within the next three years!

projected retail ecommerce

HubSpot’s State of Inbound report revealed that for 3 out of 5 marketers, generating traffic and leads is the toughest challenge. No surprise then, that 70% of them intended to expand their demand generation budgets in 2018.

But bigger budgets are useless if you use the same old strategies that didn’t work before.

How about embracing tried and tested strategies that guarantee leads in the New Year? Here goes!

Three top lead generation tips for ecommerce businesses

1. Rewrite your product descriptions with a focus on SEO

This mistake, like history, has been repeated time and again in the world of ecommerce. While the importance of having unique product descriptions is plastered all over the web, rookie ecommerce companies still make the same mistake of using manufacturer’s descriptions and putting off giving them a custom twist until later when they’ve “made some sales.”

But hey, if you won’t make them unique, how will Google rank you for those products? And if Google doesn’t rank you, how will you get any visitors? And if you don’t have any visitors, how will you have any leads? In fact, a study by AWR found that click-through rates from Google SERPs to retailers’ sites dropped from nearly 30% for position 1 to less than 5% for position 5. Thereafter, you might not as well exist.

lead generation for ecommerce

According to this post by Tracy Vides, there are four critical factors that are important for SEO, lead generation, as well as sales, which you’d do well to address on your product pages:

  1. A well-defined buyer persona that matches your most valuable customer profiles
  2. Descriptions that answer every possible question that a potential customer might have
  3. In-depth reviews from existing customers
  4. A simple, intuitive, quick, easy path to purchase

Don’t be afraid to go into great detail with product descriptions. Clearly explain all the features; in fact, make it so simple that a five-year-old should be able to use your product by reading what you have to say about it. The same goes for the “usability” of your product pages. The more (and better) content you have on your pages, the better Google will understand and consider it, the more time readers will spend on it, and the more qualified leads you will eventually get into your funnel.

2. Continually expand your email list, segment it for maximum impact

There’s no better (and cheaper!) way to stay in touch with your customers than via email. I could quote research that shows how every dollar spent on email marketing brings back up more than $ 40 in revenue, but even if you don’t get such exponential ROI, email marketing is a channel you absolute must leverage.

While getting your hands on customers’ emails are easy to get for ecommerce businesses, it’s important to also capture email addresses of website visitors and browsers. This article explains how ecommerce businesses typically gather 3x their regular number of emails with email capture pop-ups. Depending on the type of pop-up you choose – exit intent pop-ups, timed pop-ups, sidebar pop-ups, and more. You can potentially capture emails from 3 to 16% of website visitors at close-to-zero cost.

Once you’ve set up your email capture pipeline, don’t go indiscriminately mass mailing your list and put them off from all your communications. Instead, create clear segments within your database to which you can communicate distinctly different messages.

Novelty apparel retailer Johnny Cupcakes discovered the benefits of simple and basic segmentation to their pleasant surprise. They leveraged social media data to piece together a more detailed profile of their customers, with information on their gender, interests, media habits, and brand preferences, and found that a large proportion of their customers were sports fans, especially baseball.

So they decided to experiment with a new product line of baseball shirts, with distinct male and female categories. They segmented their 80,000-strong email list by gender and sent them the email creatives you see below.

lead generation ecommerce SEO

Source: Marketing Sherpa 

The results blew them away. CTRs grew by 42%, conversion rate went up by 123% and revenue per campaign rose by a whopping 141%. What a difference relevant content can make to marketing outcomes!

3. Bring back lost souls with remarketing

As the old adage goes, a bird in hand is worth two in the bush. Getting users to come to your site in the first place is hard enough. But having them leave without buying a thing is simply heartbreaking. Put the brakes on your users’ exodus by retargeting them with two of the most effective methods available – retargeted emails and retargeted ads.

Retargeting emails or abandoned cart emails, sent to users who’ve added items to their cart and then dropped off from the buying journey, are a great way to remind potential customers of what they’re missing and nudging them back into the sales funnel. These emails have the power to win back at least 15% of revenue that’s typically lost, thanks to cart abandonment.

lead generation ecommerce SEO

Source: author’s inbox

Retargeted ads come in different avatars. Just as you remind a user about an “almost” purchase with retargeting emails, you can remind users of their last visit to your site in the form of display ads, as they browse other sites across the web. The different types of retargeting ads relevant to ecommerce include:

  • Search retargeting – target users that searched for keywords related to your business, but may not have visited your website
  • Site retargeting – target users that visited your site and were “cookied” on their way out
  • Contextual retargeting – target users that visited sites or liked pages similar to yours, or those of competitors

Users’ familiarity with your products and brand means CTRs for retargeted ads are 10x those of regular display ads. Data shows that website visitors that are exposed to retargeted ads are 70% more likely to convert than those who never saw the ads. That’s massive!

Not only is retargeting better cheaper than traditional display and search advertising in terms of CPA (cost per acquisition), it also assists in reinforcing your brand on your customers’ minds – a nice little bonus!

average cost per acquisition

Source: Blue Mint Marketing

Remarketing ads offer best results on the Google Display Network and Facebook, thanks to their massive reach and extensive data on potential buyers.

Parting thoughts

No matter what industry you operate in, at the end of the day, your revenue growth is inextricably linked to growing the number of customers who shop with you. These new customers could come in from glitzy, high-budget, multimedia advertising campaigns or they could come through low-cost, high-hustle marketing that gives lasting results. I know which path I’d take. How about you?

The post 3 lead generation tips for ecommerce businesses appeared first on Search Engine Watch.

Search Engine Watch


Tinder agrees to settle age discrimination lawsuit

January 26, 2019 No Comments

Tinder recently agreed to settle a $ 23 million class-action age discrimination lawsuit. The lawsuit, filed last April in California, alleged Tinder charged people over 30 years old twice the amount for its subscription services.

The class consists of every person 29 years of age or older at the time who subscribed to Tinder Plus or Tinder Gold between March 2, 2015 and the date of preliminary approval, according to the proposed order granting motion for preliminary approval of the class-action settlement.

“Under the Settlement, Defendants agree to a multifaceted Settlement structure, which includes a universal participation component (automatic benefits to all Class Members);” the settlement states. “An additional cash or cash-equivalent payout to Class Members who submit timely valid claims; and an agreement to substantially halt Defendants’ allegedly discriminatory practices going forward.”

Filed on behalf of about 230,000 class members, each person will be able to receive either $ 25 in cash, 25 additional Super Likes or a one-month subscription to either Tinder Plus or Tinder Gold. As part of the settlement, Tinder must distribute $ 11.5 million to all class members, as well as $ 5.75 million in potential cash or cash-equivalents (e.g. Super Likes) to every class member who submits a claim.

Tinder has also agreed to stop charging people — just those located in California — different prices based on their age. That carries a value of at least $ 5.75 million, according to the settlement. In total, this amounts to a $ 23 million settlement.

I’ve reached out to Tinder and will update this story if I hear back. In the meantime, feel free to check out the settlement below.


Social – TechCrunch


BioWare’s ambitious Anthem is off to a rough start as players bring servers to their knees

January 26, 2019 No Comments

The gaming world is excited to play Anthem, BioWare’s answer to Destiny and other big-budget online shooters — but an exclusive preview weekend for the mech-flying game has struggled to get off the ground. Of course, it wouldn’t be a game launch these days without a few hiccups to spice things up, but it is a little embarrassing.

The 40-gigabyte demo was made available today to those who had pre-ordered the game, as well as press and other “VIPs.” The game, announced last year at E3, is a loot-focused shooter where you pilot mechs through a huge open world, engage in cooperative combat and exploration and all that.

At least, so they say. Reports immediately came flooding in on forums and social media that not only was Origin, the service on which the demo is offered, failing to function properly, but that the game itself wasn’t connecting to servers, or if it did, wouldn’t load beyond the intro sequence.

I encountered this myself; after eventually getting loaded and logged in, I managed to get into the starting town area where you will, in the full game, upgrade your gear, accept quests and so on. But when I attempted to launch the first mission or otherwise enter the actual game world, the loading bar would stop about 95 percent of the way done and stay there forever (I waited about five minutes and reloaded a couple times to make sure it wasn’t just my aging rig). Those who made it all the way in complained of lag and glitches.

No one really ever expects a major title, especially one with a major online components, to launch even in a limited way without a few speed bumps, but something like this can really put the brakes on a hype train. Publisher EA admitted to the laundry list of issues from a support Twitter account:

Funnily enough EA Help’s own servers were having trouble as well, so not only could people not play Anthem, they couldn’t report that they couldn’t play Anthem.

Patience is a necessary virtue in today’s AAA game launches, but the people hoping to play this weekend aren’t randos but paying customers; this preview demo weekend was supposed to be a pre-order bonus, but the first day is a bust so far. Considering BioWare and EA knew exactly how many players could be trying to connect today — and those numbers are likely far less than those who will try the open beta or connect on launch day — it’s rather odd that they were seemingly caught so off-guard.

Anthem is certainly promising and the developers have gone out of their way to assure players that many of the hated practices of online games these days would not find a home on their platform. But launch problems always jar the confidence of undecided buyers, and there’s almost no question that the game will be better a month or two after its actual debut. Launch numbers could be affected by players not believing the game is ready to play, and therefore not being willing to pay.

I fully anticipate these issues getting resolved at some point soon, however, and will collect my impressions of the game in a separate post when that happens.

Gadgets – TechCrunch


Announcement! The 2019 PPC Hero Summit is March 6th

January 25, 2019 No Comments

The 2019 PPC Hero Summit is a half-day free seminar for digital marketers that features 8 sessions with the writers and digital experts behind PPC Hero, in partnership with Optmyzr, Mobile Monkey, Adstage, and Unbounce. If paid advertising is a part of your job, then this is an event for you! The Summit features popular […]

Read more at PPCHero.com
PPC Hero


Robots Will Take Jobs From Men, the Young, and Minorities

January 24, 2019 No Comments

Automation may create as many jobs as it destroys, a new study finds, but men, younger folks, and minorities hold positions that are particularly vulnerable.
Feed: All Latest


Starter Projects for New Coders

January 23, 2019 No Comments

Knowing what to do can be one of the biggest challenges for new coders. In a previous article we covered choosing a language. Now you’ve made your way around tutorials on variables, loops, and functions but how can you apply it to your job?

Read more at PPCHero.com
PPC Hero


Citizens Reserve is building a supply chain platform on the blockchain

January 22, 2019 No Comments

Citizens Reserve, a Bay Area startup, has a broad goal of digitizing the supply chain. Last fall, the company launched the Alpha version of Suku, a Supply Chain as a Service platform built on the blockchain. Today, it announced a partnership with Smartrac, an RFID tag manufacturer, based in Amsterdam, as a key identity piece for the platform.

Companies use RFID to track products from field or factory to market. Eric Piscini, CEO at Citizens says this partnership helps solve a crucial piece of digitizing the supply chain. It provides a way to trace products on their journey to market, and ensure their provenance, whether that is to be sure no labor was exploited in production, environmental standards were maintained or that the products were stored under the proper conditions to ensure freshness.

One of the big issues in track and trace on the supply chain is simply identifying the universe of items in motion across the world at any given moment. RFID tagging provides a way to give each of these items a digital identity, which can be placed on the blockchain to help prevent fraud. Once you have an irrefutable digital identity, it solves a big problem around digitizing the supply chain.

He said this is all part of a broader effort to move the supply chain to the digital realm by building a platform on the blockchain. This not only provides an irrefutable, traceable digital record, it can have all kinds of additional benefits like reducing theft and fraud and ensuring provenance.

There are so many parties involved in this process from farmers and manufacturers to customs authorities to shipping and container companies to logistics companies moving the products to market to the stores that sell the goods. Getting all of the various parties involved in the supply chain to move to a blockchain solution remains a huge challenge.

Today’s partnership offers one way to help build an identity mechanism for the Citizens Reserve solution. The company is also working on other partnerships to help solve other problems like warehouse management and logistics.

The company currently has 11 employees based in Los Gatos, California. It has raised $ 11 million, according to Piscini.


Enterprise – TechCrunch


Tips to maximize ROI on paid social: Facebook + Instagram

January 22, 2019 No Comments

Available ad impressions on social media are hitting a wall as user growth slows, driving up CPC and CPM prices. As demand increases, it becomes even more important for advertisers to properly optimize campaigns to maximize their return on investment for paid social.

According to Merkle’s Q2 2018 Digital Marketing Report, advertiser spend increased 40% year-over-year in Q2, while impressions fell 17%.

The influx of advertising dollars to social media platforms with a steady number of available impressions means that the average cost-per-click (CPC) is rising.

Many paid social media campaigns do not maximize their return on investment because of poor or incomplete optimization, limited distribution, incomplete tracking, and undefined goals.

Here’s what you need to do to squeeze more out of your paid social media campaigns.

Advertising for the funnel

Each advertisement you run must have a clear goal in mind, and that goal must fit into a larger piece of your paid social media strategy. Moving prospects from the top of the funnel to the bottom—as efficiently as possible—is necessary for a successful ad campaign.

Keep in mind that it may take multiple interactions with your advertisements and content before someone works their way through the funnel. Your ad campaigns should never take on a one-and-done approach.

An ad targeting a past purchaser will be very different than an ad targeting someone who is completely unfamiliar with your brand and products.

This makes it important to segment your customers into the correct phase of the buying process. Run different ads with different messages and calls to action for each segment.

Advertise smarter, not harder.

Simple process improvements

A number of small improvements can greatly impact the success of a paid social media campaign. Not implementing these is basically leaving money on the table. Remember, we are trying to squeeze every last drop of ROI out of these campaigns, even if getting the maximum return takes time.

While the examples I cite relate to Facebook and Instagram, we can see equivalents on Twitter, YouTube, Pinterest, LinkedIn, and Snapchat to some degree.

Whichever social media platform you are advertising through, follow platform best practices and make sure everything is set up properly—through tracking pixels and UTM codes. Everything should be properly attributed across platforms.

Facebook Pixel

First, make sure that Facebook’s tracking pixel is properly implemented on your website.

Facebook Pixel Helper, a free Chrome browser extension from Facebook, can help you troubleshoot any issues. You can find information on how to set up Facebook Pixel from scratch on Facebook’s website.

You also need to set up Facebook Pixel with standard events like newsletter sign-ups and successful e-commerce actions (add to cart, purchase, etc.) to help with creating higher quality custom and lookalike audiences.

Facebook and Instagram have powerful tracking and conversion optimization abilities in their ad technology, so use them.

Custom audiences

Using Facebook’s custom audiences feature is a must if you want your paid social media campaigns to really perform.

It is foolish to not capture and harness information about your website’s visitors, especially when it is free and requires only minutes to set up. Facebook offers a number of ways to create a custom audience in the Facebook Ads Manager.

Facebook’s Create a Custom Audience Tool

Website traffic

If your Facebook Pixel is properly set up, it can record every action taken by visitors on your website in the past 180 days. The actions include page views, button clicks, abandoned carts, and purchases.

You can create audiences to build lookalike audiences or use them for remarketing.

Advertising to someone who has already been to your website and possibly even completed on-site actions has a much higher chance of converting than advertising to a first-time visitor.

Offline conversions

With proper implementation, you can track offline events, like sales at physical retail locations, after someone has interacted with your Facebook advertisements.

There are two ways to set up offline activity: either upload the offline data CSV file manually to Facebook or sync your CRM directly with Facebook. The customer information will then be matched to the correct user IDs on Facebook.

This approach will show you if someone took a specific action, like purchasing after viewing.

Creating offline events

Lookalike audiences

You can create lookalike audiences in the Facebook Ads Manager to find audiences that have similar traits and characteristics to your ideal user.

The lookalike audience is created based on a custom audience, which acts as a seed audience. This allows you to greatly expand the number of potential customers you can target based on a higher-quality custom audience.

Lookalike audiences let you target people similar to your existing, custom audiences

Conversion tracking

Conversions are of paramount importance for e-commerce stores. Website traffic is useless unless it results in sales. Luckily, Facebook and Instagram can help optimize your campaign’s delivery for successful conversions.

Conversion tracking depends on the proper implementation of the tracking pixel and properly set up ad campaigns. You also need to set up standard events or custom conversions on Facebook to accurately measure and optimize for conversions. Google Analytics offers conversion tracking as well, but it’s based on a last-click-attribution model.  

There is no reason not to track and optimize for conversions. Even media companies that generate revenue by on-site ad units can benefit from optimizing toward conversions by focusing on pages-per-session to find a higher quality user, opposed to general website visitors.  

Remarketing

Remarketing with social media ad managers requires proper implementation of each platforms’ tracking pixels.

For example, Facebook’s audience and lookalike audience features are powerful tools that can track users and specific website actions up to 180 days in the past.

Remarketing with these audiences in mind is a strategic approach, and entire campaigns can be built around them. In fact, these types of campaigns often yield the highest returns.  

Facebook remarketing illustration

 

Image: http://marketingjumpleads.com/facebook-remarketing

Sequential Advertising

Sequential advertising is when you show different ads to the same person over a period of time. Large television campaigns sometimes use this tactic, but there is no reason why it cannot be successfully applied to paid social media campaigns.

For example, you may show an audience an ad focusing on one benefit of your product. The next ad, after the majority of people in the audience has seen the first one, would highlight another benefit of the product. The third ad would highlight a customer testimonial. You are showing your audience the same product but with different messaging.

If you are running video ads, you could also share a related story via that format. Think the Budweiser Frogs television campaign or some of BMW’s mini-movies. A sequential advertising campaign does not have to go to such lengths to be successful, but fresh, on-brand, eye-catching creative in any form is generally a good thing.

Maximizing distribution

Besides improvements to the advertising process, further optimization to paid social campaigns can be achieved through maximizing the campaigns’ distribution. That will ensure your campaign is successful based on your set goals. Not maximizing the distribution of your ads will leave money on the table.

Regularly refresh your creative

Using the same creative—images, video, and text—over and over can quickly cause fatigue. This means your audience will start to ignore your ads—or worse, start leaving mean comments on them. You’ll also start experiencing an increase in CPM and CPC as you lose more in Facebook’s ad auction.

Regularly refresh your creative to avoid this. It makes a difference, even if you’re just refreshing your images or copy every month.

Standing out in the newsfeed is a big part of successful paid campaigns. If you are using photographs or videos, they need to be high quality and relatable to make the user stop scrolling through their newsfeed.

Pay special attention to resolution, aspect ratio, and how the ad units look on a mobile device. The majority of users will see your ad on their phone, so make sure it’s thumb-stopping.   

Use all available placements

Facebook is always optimizing for the lowest event cost possible. The vast majority of your results will come from ads run on the Facebook or Instagram newsfeed. But don’t forget about other placements, like the sidebar, messenger, and marketplace.

Automatic placements are the best option to maximize results beyond the newsfeeds.

All placements selected

All placements selected.

Image: https://www.facebook.com/business/help/965529646866485

Limited placements selected

Limited placements selected.

Image: https://www.facebook.com/business/help/965529646866485

Optimize for mobile

Unless you specifically target only desktop device users, the majority of the impressions or clicks you receive will be from mobile devices. This means you better make sure your creative is mobile-friendly.

Make sure all of your images and videos are formatted to maximize the viewable space on mobile for the type of advertisement you are running. Your headlines and accompanying text also need to be optimized to fit.

If you’re using videos, make sure they’re formatted to a 1:1 aspect ratio (square videos) to take up the most room on the Facebook mobile newsfeed and outperform horizontal aspect videos.

Benefits of mobile optimized video

Image: https://blog.bufferapp.com/square-video-vs-landscape-video

Minimize restrictions for the Facebook algorithm

Don’t try to control Facebook too much. Instead, give Facebook room to show your ads to the correct users at the correct time with the least necessary targeting restrictions. The more freedom the algorithm has to use your pixel data, the better able it is to encourage conversions.  

Josh Thompson is Senior Social Media Strategist at Portent—a Clearlink Digital Agency. Josh is Facebook Blueprint Certified and has worked in social media advertising for seven years.

The post Tips to maximize ROI on paid social: Facebook + Instagram appeared first on Search Engine Watch.

Search Engine Watch


The case against behavioral advertising is stacking up

January 22, 2019 No Comments

No one likes being stalked around the Internet by adverts. It’s the uneasy joke you can’t enjoy laughing at. Yet vast people-profiling ad businesses have made pots of money off of an unregulated Internet by putting surveillance at their core.

But what if creepy ads don’t work as claimed? What if all the filthy lucre that’s currently being sunk into the coffers of ad tech giants — and far less visible but no less privacy-trampling data brokers — is literally being sunk, and could both be more honestly and far better spent?

Case in point: This week Digiday reported that the New York Times managed to grow its ad revenue after it cut off ad exchanges in Europe. The newspaper did this in order to comply with the region’s updated privacy framework, GDPR, which includes a regime of supersized maximum fines.

The newspaper business decided it simply didn’t want to take the risk, so first blocked all open-exchange ad buying on its European pages and then nixed behavioral targeting. The result? A significant uptick in ad revenue, according to Digiday’s report.

“NYT International focused on contextual and geographical targeting for programmatic guaranteed and private marketplace deals and has not seen ad revenues drop as a result, according to Jean-Christophe Demarta, SVP for global advertising at New York Times International,” it writes.

“Currently, all the ads running on European pages are direct-sold. Although the publisher doesn’t break out exact revenues for Europe, Demarta said that digital advertising revenue has increased significantly since last May and that has continued into early 2019.”

It also quotes Demarta summing up the learnings: “The desirability of a brand may be stronger than the targeting capabilities. We have not been impacted from a revenue standpoint, and, on the contrary, our digital advertising business continues to grow nicely.”

So while (of course) not every publisher is the NYT, publishers that have or can build brand cachet, and pull in a community of engaged readers, must and should pause for thought — and ask who is the real winner from the notion that digitally served ads must creep on consumers to work?

The NYT’s experience puts fresh taint on long-running efforts by tech giants like Facebook to press publishers to give up more control and ownership of their audiences by serving and even producing content directly for the third party platforms. (Pivot to video anyone?)

Such efforts benefit platforms because they get to make media businesses dance to their tune. But the self-serving nature of pulling publishers away from their own distribution channels (and content convictions) looks to have an even more bass string to its bow — as a cynical means of weakening the link between publishers and their audiences, thereby risking making them falsely reliant on adtech intermediaries squatting in the middle of the value chain.

There are other signs behavioural advertising might be a gigantically self-serving con too.

Look at non-tracking search engine DuckDuckGo, for instance, which has been making a profit by serving keyword-based ads and not profiling users since 2014, all the while continuing to grow usage — and doing so in a market that’s dominated by search giant Google.

DDG recently took in $ 10M in VC funding from a pension fund that believes there’s an inflection point in the online privacy story. These investors are also displaying strong conviction in the soundness of the underlying (non-creepy) ad business, again despite the overbearing presence of Google.

Meanwhile, Internet users continue to express widespread fear and loathing of the ad tech industry’s bandwidth- and data-sucking practices by running into the arms of ad blockers. Figures for usage of ad blocking tools step up each year, with between a quarter and a third of U.S. connected device users’ estimated to be blocking ads as of 2018 (rates are higher among younger users).

Ad blocking firm Eyeo, maker of the popular AdBlock Plus product, has achieved such a position of leverage that it gets Google et al to pay it to have their ads whitelisted by default — under its self-styled ‘acceptable ads’ program. (Though no one will say how much they’re paying to circumvent default ad blocks.)

So the creepy ad tech industry is not above paying other third parties for continued — and, at this point, doubly grubby (given the ad blocking context) — access to eyeballs. Does that sound even slightly like a functional market?

In recent years expressions of disgust and displeasure have also been coming from the ad spending side too — triggered by brand-denting scandals attached to the hateful stuff algorithms have been serving shiny marketing messages alongside. You don’t even have to be worried about what this stuff might be doing to democracy to be a concerned advertiser.

Fast moving consumer goods giants Unilever and Procter & Gamble are two big spenders which have expressed concerns. The former threatened to pull ad spend if social network giants didn’t clean up their act and prevent their platforms algorithmically accelerating hateful and divisive content.

While the latter has been actively reevaluating its marketing spending — taking a closer look at what digital actually does for it. And last March Adweek reported it had slashed $ 200M from its digital ad budget yet had seen a boost in its reach of 10 per cent, reinvesting the money into areas with “‘media reach’ including television, audio and ecommerce”.

The company’s CMO, Marc Pritchard, declined to name which companies it had pulled ads from but in a speech at an industry conference he said it had reduced spending “with several big players” by 20 per cent to 50 per cent, and still its ad business grew.

So chalk up another tale of reduced reliance on targeted ads yielding unexpected business uplift.

At the same time, academics are digging into the opaquely shrouded question of who really benefits from behavioral advertising. And perhaps getting closer to an answer.

Last fall, at an FTC hearing on the economics of big data and personal information, Carnegie Mellon University professor of IT and public policy, Alessandro Acquisti, teased a piece of yet to be published research — working with a large U.S. publisher that provided the researchers with millions of transactions to study.

Acquisti said the research showed that behaviourally targeted advertising had increased the publisher’s revenue but only marginally. At the same time they found that marketers were having to pay orders of magnitude more to buy these targeted ads, despite the minuscule additional revenue they generated for the publisher.

“What we found was that, yes, advertising with cookies — so targeted advertising — did increase revenues — but by a tiny amount. Four per cent. In absolute terms the increase in revenues was $ 0.000008 per advertisment,” Acquisti told the hearing. “Simultaneously we were running a study, as merchants, buying ads with a different degree of targeting. And we found that for the merchants sometimes buying targeted ads over untargeted ads can be 500% times as expensive.”

“How is it possible that for merchants the cost of targeting ads is so much higher whereas for publishers the return on increased revenues for targeted ads is just 4%,” he wondered, posing a question that publishers should really be asking themselves — given, in this example, they’re the ones doing the dirty work of snooping on (and selling out) their readers.

Acquisti also made the point that a lack of data protection creates economic winners and losers, arguing this is unavoidable — and thus qualifying the oft-parroted tech industry lobby line that privacy regulation is a bad idea because it would benefit an already dominant group of players. The rebuttal is that a lack of privacy rules also does that. And that’s exactly where we are now.

“There is a sort of magical thinking happening when it comes to targeted advertising [that claims] everyone benefits from this,” Acquisti continued. “Now at first glance this seems plausible. The problem is that upon further inspection you find there is very little empirical validation of these claims… What I’m saying is that we actually don’t know very well to which these claims are true and false. And this is a pretty big problem because so many of these claims are accepted uncritically.”

There’s clearly far more research that needs to be done to robustly interrogate the effectiveness of targeted ads against platform claims and vs more vanilla types of advertising (i.e. which don’t demand reams of personal data to function). But the fact that robust research hasn’t been done is itself interesting.

Acquisti noted the difficulty of researching “opaque blackbox” ad exchanges that aren’t at all incentivized to be transparent about what’s going on. Also pointing out that Facebook has sometimes admitted to having made mistakes that significantly inflated its ad engagement metrics.

His wider point is that much current research into the effectiveness of digital ads is problematically narrow and so is exactly missing a broader picture of how consumers might engage with alternative types of less privacy-hostile marketing.

In a nutshell, then, the problem is the lack of transparency from ad platforms; and that lack serving the self same opaque giants.

But there’s more. Critics of the current system point out it relies on mass scale exploitation of personal data to function, and many believe this simply won’t fly under Europe’s tough new GDPR framework.

They are applying legal pressure via a set of GDPR complaints, filed last fall, that challenge the legality of a fundamental piece of the (current) adtech industry’s architecture: Real-time bidding (RTB); arguing the system is fundamentally incompatible with Europe’s privacy rules.

We covered these complaints last November but the basic argument is that bid requests essentially constitute systematic data breaches because personal data is broadcast widely to solicit potential ad buys and thereby poses an unacceptable security risk — rather than, as GDPR demands, people’s data being handled in a way that “ensures appropriate security”.

To spell it out, the contention is the entire behavioral advertising business is illegal because it’s leaking personal data at such vast and systematic scale it cannot possibly comply with EU data protection law.

Regulators are considering the argument, and courts may follow. But it’s clear adtech systems that have operated in opaque darkness for years, without no worry of major compliance fines, no longer have the luxury of being able to take their architecture as a given.

Greater legal risk might be catalyst enough to encourage a market shift towards less intrusive targeting; ads that aren’t targeted based on profiles of people synthesized from heaps of personal data but, much like DuckDuckGo’s contextual ads, are only linked to a real-time interest and a generic location. No creepy personal dossiers necessary.

If Acquisti’s research is to be believed — and here’s the kicker for Facebook et al — there’s little reason to think such ads would be substantially less effective than the vampiric microtargeted variant that Facebook founder Mark Zuckerberg likes to describe as “relevant”.

The ‘relevant ads’ badge is of course a self-serving concept which Facebook uses to justify creeping on users while also pushing the notion that its people-tracking business inherently generates major extra value for advertisers. But does it really do that? Or are advertisers buying into another puffed up fake?

Facebook isn’t providing access to internal data that could be used to quantify whether its targeted ads are really worth all the extra conjoined cost and risk. While the company’s habit of buying masses of additional data on users, via brokers and other third party sources, makes for a rather strange qualification. Suggesting things aren’t quite what you might imagine behind Zuckerberg’s drawn curtain.

Behavioral ad giants are facing growing legal risk on another front. The adtech market has long been referred to as a duopoly, on account of the proportion of digital ad spending that gets sucked up by just two people-profiling giants: Google and Facebook (the pair accounted for 58% of the market in 2018, according to eMarketer data) — and in Europe a number of competition regulators have been probing the duopoly.

Earlier this month the German Federal Cartel Office was reported to be on the brink of partially banning Facebook from harvesting personal data from third party providers (including but not limited to some other social services it owns). Though an official decision has yet to be handed down.

While, in March 2018, the French Competition Authority published a meaty opinion raising multiple concerns about the online advertising sector — and calling for an overhaul and a rebalancing of transparency obligations to address publisher concerns that dominant platforms aren’t providing access to data about their own content.

The EC’s competition commissioner, Margrethe Vestager, is also taking a closer look at whether data hoarding constitutes a monopoly. And has expressed a view that, rather than breaking companies up in order to control platform monopolies, the better way to go about it in the modern ICT era might be by limiting access to data — suggesting another potentially looming legal headwind for personal data-sucking platforms.

At the same time, the political risks of social surveillance architectures have become all too clear.

Whether microtargeted political propaganda works as intended or not is still a question mark. But few would support letting attempts to fiddle elections just go ahead and happen anyway.

Yet Facebook has rushed to normalize what are abnormally hostile uses of its tools; aka the weaponizing of disinformation to further divisive political ends — presenting ‘election security’ as just another day-to-day cost of being in the people farming business. When the ‘cost’ for democracies and societies is anything but normal. 

Whether or not voters can be manipulated en masse via the medium of targeted ads, the act of targeting itself certainly has an impact — by fragmenting the shared public sphere which civilized societies rely on to drive consensus and compromise. Ergo, unregulated social media is inevitably an agent of antisocial change.

The solution to technology threatening democracy is far more transparency; so regulating platforms to understand how, why and where data is flowing, and thus get a proper handle on impacts in order to shape desired outcomes.

Greater transparency also offers a route to begin to address commercial concerns about how the modern adtech market functions.

And if and when ad giants are forced to come clean — about how they profile people; where data and value flows; and what their ads actually deliver — you have to wonder what if anything will be left unblemished.

People who know they’re being watched alter their behavior. Similarly, platforms may find behavioral change enforced upon them, from above and below, when it becomes impossible for everyone else to ignore what they’re doing.


Social – TechCrunch