AI, privacy, and transparency: adtech’s latest shifts and challenges

Welcome to the latest edition of Spotlight, your monthly recap of the biggest stories in adtech and digital marketing.

What we have for you today: Meta to mine its AI data for targeted advertising, Google decimates the Privacy Sandbox, and CTV advertisers demand greater transparency

Fighting back against the machines

As if one were needed, here’s a reminder of all that’s bad with AI. Where once the internet was an information superhighway connecting the world to (generally speaking) high-quality, or at least useful, content, today it’s coming to be dominated by AI slop – the ultra-processed food of digital culture. For publishers, it’s vital to be able to show to advertisers that your sites are a cut above the rest. Yes, that means focusing on delivering great content, but it also means being able to demonstrate that your inventory attracts relevant audiences at scale. Being able to know and verify your audiences has never been more vital.

As you might expect from a publication of its quality and heritage, The Economist is showing what publishers can do to adapt to an AI-centric internet. Tellingly, one of its key tactics is to put more focus back on increasing advertising revenue and deepen direct ties with readers. It will reveal more later this month, but our bet is that a robust data strategy will lie at the heart of both efforts.

Social surveillance

Users of WhatsApp, Facebook, and Instagram can now support their experiences with Meta AI, a tool that answers questions, generates images and videos, and summarises info. Increasingly it will also snoop on you. Meta has announced that from 16^th December it will start using data from AI chats in order to create targeted ads on Instagram and Facebook. Oh, and you won’t be able to opt-out.

Interestingly, the policy will not apply to users in the UK, South Korea, and the European Union. Coincidence or not, these three jurisdictions also have very strong laws around data privacy and consent.

So, what does all this mean? Is Meta rolling the pitch for a consent or pay in three excluded regions? Or are we seeing the emergence of a two-tier internet – privacy-centric for those who happen to live in countries with strong regulation and “surveillance capitalism” those who don’t? Whatever the case, Meta should tread carefully – consumers increasingly demand privacy-preservation from the tech companies they trust their data to. If these concerns are continually ignored, perhaps they will look elsewhere for their social feeds.

Google who?

In signs that the adtech industry is going through a major sea change, Google has all but pulled the plug on its Privacy Sandbox. Topics, PAAPI and nine other key features have been given the chop. The only elements to remain are CHIPS, FedCM, and private state tokens. The Privacy Sandbox, once touted as the future for a privacy-first internet, is all but dead in the water. With tracking cookies now set to remain in Chrome, it seems Google is committing to the status quo.

Interestingly, the industry seems to be moving on without them. A new survey found that over nine in 10 advertisers, publishers and tech vendors are looking beyond third-party cookies. And despite Google’s recent about face on cookie deprecation, adoption of alternative ID solutions is on the rise, and 90% of respondents report satisfaction with their chosen methods. This is huge. The digital marketing ecosystem seems to be untethering from Google and moving rapidly towards a new, fragmented, privacy-first world. This is good news for anyone interested in a healthly adtech marketplace.

Looking inside the CTV box

In a further sign of the growing maturity of the CTV advertising ecosystem, advertisers are demanding transparency around inventory and the supply chain, and they’re increasingly turning to the supply side to provide answers. As advertisers look to understand (and clean up) the bidstream, we also believe that they will demand greater insights into audience addressability and reach so they can optimise their campaigns and ensure they’re reaching the right audiences. This in turn will require privacy-preserving ways of verifying users and repeat viewers – exactly the sort of challenge, in short, that open-web publishers have been grappling with for the past seven years.

More from Novatiq

As usual, feel free to swing by our blog for more insights on digital marketing and adtech. This month, we’re asking whether cookieless advertising will ever become a reality (spoiler alert: we think it will).