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Bots, GDPR & Second-Party Data: Why Data Quality is King in 2018

GDPR

With 2017 now behind us, it’s time for advertisers to look ahead. Data – and the insights it provides – will continue to play a role for campaign success in 2018. However, instead of data volume, advertisers are becoming increasingly focused on how to get their hands on only the best-quality insights and intelligence. They want data accuracy and transparency, more than ever before. In this piece for ExchangeWire, Eric Marterella (pictured below), CRO, Lotame, discusses the forthcoming GDPR rule and how embracing second-party data will help advertisers find the highest quality insights and bring their advertising strategies to the next level.

Data quality will be a key focus in 2018. With this in mind, here are three important data quality predictions for our industry this year:

We need to fix the bot problem

2017 was all about transparency in digital. Most of the conversation focused on the murky programmatic supply chain. But bots remain, in my opinion, one of the biggest ongoing threats to campaign and audience clarity.

Distil Networks, for instance, has found that bots accounted for roughly 40% of internet traffic and that 94% of websites were hit with bad bots that skew marketing analytics. Bot traffic creates negative outcomes across the digital ecosystem. For publishers, bots pick up and inflate first-party audience data, resulting in wasted bandwidth, content piracy, fake traffic, and skewed site analytics. Bots damage marketers and agencies by frequently clicking and engaging with digital advertising and, ultimately, decreasing campaign effectiveness.

Ad Fraud, GDPR, 2nd Party Data

Eric Marterella, CRO, Lotame

In 2018, we need to refocus efforts on solving the bot problem. It’s too prevalent to ignore and needs to be fixed at the vendor level. This year, more ad tech and marketing platforms will embrace third-party bot-detection and quality measurement partners to audit the inventory and data they share. This is the only way to deliver true transparency to advertisers and publishers alike.

GDPR is coming – and that’s OK

In May, GDPR will go into effect. And with it comes new rules surrounding digital data collection. Now, EU audiences will have more control over how their personal information is indexed and used.

In the ad industry, reception to this new regulation has generally been negative. Brands and agencies rely on consumer data to develop personal – and ultimately successful – advertising experiences. GDPR, however, will treat anonymous and personal data identically, which could have a major impact on ad experiences for consumers in the EU. What’s more, there are significant compliance costs that come with GDPR. Those who don’t obey will face fines, which could amount to as much as 4% of global revenue.

Now, while these new guidelines could cause early problems for advertisers, GDPR will also bring with it key long-term advertising benefits. For example, GDPR raises the bar for opt-in data collection. While this will reduce the scale of data collected, it will dramatically raise the quality. This means better ad experiences for consumers and stronger ROI. More marketers will realise this as we get closer to the launch date.

Second-party data is king

Second-party data was all the rage in 2017, and that will continue in 2018. Second-party data is essentially someone else’s first-party data that you access directly from them. There is no data aggregator or other middleman in the exchange of second-party data. Through a direct relationship with the owner of the first-party data, you can define exactly what data is being bought or sold, the price of the data, and any other commercial terms.

The possibilities with second-party data are endless. Advertisers can choose the data sources they feel are most relevant to their campaign optimisation, filtering out all the unnecessary stuff. This is where you can take data-driven marketing to a place that is not only unique, but extremely efficient. And what second-party data may lack in scale it makes up for with precision.

Second-party data will explode in demand this year, driven by advertiser calls for transparency and clarity in the data they use. By cutting out the middleman, marketers can go directly to companies that they know will have the most important high-quality data. The data is unique, and a direct relationship is in place, so quality is never an issue.

In 2018, data quality is king. For the industry to truly deliver, the bot problem needs to be addressed. Meanwhile, the forthcoming GDPR rule, and the category’s embrace of second-party data, will help advertisers find the highest quality insights and bring their advertising strategies to the next level. It will be an exciting year.

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