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It all boils down to GDPR

If it runs on garbage data, your beautiful machine’s going nowhere

Christophe Thibault
GDPR
© Shutterstock / cigdem

As competition around algorithms will remain the most heated battleground for ad tech companies, excellent results all start with the quality of data. The old adage, ‘garbage in, garbage out’ has never been more apt. As it turns out, first-party data is not only the new gold standard for advertising, it’s set to become the legal benchmark too when the GDPR is enforced.

Since the dawn of digital advertising, the industry has been focused on delivering the four ‘rights’; the right message, to the right person, at the right time, through the right channel. In 2018 little has changed in these fundamentals, but at a time of near limitless data and plentiful platforms on offer, picking the right combination is a make or break decision.

With smartphone ownership now a de facto way of life for most of the developed world – now up to 85% penetration in the UK – the opportunities for marketers to take data interpretation to new heights are plentiful. Digital devices including phones and tablets leave contextual data trails with every user interaction. In simple terms, with each click, hover, link followed, comment made, or even via powering up a device, data is created. When correctly collected and interpreted, these individualized and contextualized predictions can be used to understand or very likely infer something about those users through their behavior.

Contextualised data, from savvier consumers

A byproduct of this smartphone era is a higher level of expectation from users, who not only expect more from the devices they own but are also far more discerning about the advertising to which they are exposed. The use of ad blocking software on mobile rose to 380m devices worldwide in 2016. Furthermore, a survey report in the same year from Hubspot investigating the issue found that a combined 77% of its respondents either agreed or strongly agreed that they wished there were a way to ‘ad-filter instead of ad-block completely’, allowing for more relevant commercials to reach their targets. Sadly, for marketers, ad blocking software is not discerning; it’s either all on or all off.

In the face of such threats, there is now more need than ever for the advertising industry to deliver more engaging, contextualized messages. If the pursuit of increased performance was not enough incentive alone, then the continued future viability of an industry dealing with ever more savvy consumers surely should be.

Competing on quality data

As such, advertisers are now inclined to pay more attention to the performance quality of interactions between people and their brand expositions. And this means going over and above the typical CPC and CPV metrics that have long become the industry standard.

Increasingly sophisticated algorithms are able to display better ads to users at the best possible moments. While these techniques have existed in some form since the early days of the web, it’s only recently that the leaps taken in infrastructure have made it possible to process the mountains of user data collected in near real time. The best machine learning algorithms – those able to profit from this aforementioned richness of new data – enable the display of engaging ads that increase both short-term performance and long-term familiarity with brands.

However, competition around writing the latest and greatest algorithms is just half the battle. Best in class results can only come from a combination of both exhaustive, high-quality data with the most innovative, efficient algorithms. There is no silver bullet solution that will dominate all others in all circumstances; there will always be a variety of approaches to tackle any particular set of criteria. Each of these, in turn, will come with decisions around which trade-offs you are willing to accept (typically around degrees of speed and accuracy). Like a top chef selecting the right ingredients for the right recipe, effective marketers will combine the most relevant data with the appropriate algorithm in order to deliver appetizing results.

And as much as competition around algorithms will remain the most heated battleground for ad tech companies, excellent results all start with the quality of data. The old adage, ‘garbage in, garbage out’ has never been more apt. There’s no circumventing data input, and even the best machine learning algorithm will give deceptive results if only applied to low-quality data. It’s no coincidence that the runaway market leaders in machine learning for advertising, Google and Facebook, are also those with free-flowing taps of first party, proprietary data.

Playing inside the law

As it turns out, first-party data is not only the new gold standard for advertising, it’s set to become the legal benchmark too. The European Union’s ruling on GDPR is set to come into force officially in May, and is now the most pressing topic for anyone collecting user data and hoping to do business on the continent. For advertisers, there will be no exception, which is one of the chief reasons why from day one at Ogury we have focused on explicit, transparent user consent in our data generation.

If you’re still planning to take part in the machine learning ad race, make sure your provider is not only collecting genuine first party data but that it comes from future-proofed methods too. Otherwise remember; garbage in, garbage out.

Author

Christophe Thibault

Christophe Thibault is Chief Algorithms Officer at Ogury.


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