Will Trust and Transparency Be the Killer Apps of the Future?

May 7, 2020

The previous two decades proved the value of data. The coming years will be about building a transparent marketplace for that data—one where all stakeholders have meaningful participation.

As 2020 sets in, the dawn of digital advertising seems like a distant memory. But the original idea was simple. People would see fewer ads because every ad would be more personalized and more relevant to their interests. Only it didn't quite work out that way.

Throughout the last decade, new media disrupted itself over and over again. We saw the rise of social. The rise of mobile. The rise of digital video. The rise of native. The rise of OTT and Connected TV. With each new iteration in digital media, marketplaces became more complicated, less transparent, and ultimately, difficult to trust. At decade's end, we've found ourselves wondering how much of each media dollar is siphoned off by the "ad tech tax" and how it is that fraud persists?

That same decade has also seen a dramatic shift on the consumer side. Ten years ago, consumers hardly noticed that it was their data that fueled the digital ecosystem. Today, privacy is a real concern for many consumers.

A recent Pew report found that 81 percent of Americans feel they have very little or no control over what companies do with their data. The same percentage of Americans also said that the potential risks of commercial data collection outweigh the benefits. Seventy-nine percent of Americans said they were concerned about companies collecting their data. But perhaps most alarming, 59 percent of Americans said they have little or no understanding of commercial data collection practices.

Can we do better in the years to come? I think we must. This past January, California's privacy law (CCPA) took effect. The enactment coincided with hopes the federal government will take up privacy legislation sooner rather than later, if only to clarify the effects of CCPA.

As we wait, new privacy laws usher in predictable results. GDPR has already caused advertisers to shift their budgets to private marketplaces, use less third-party data, and rely more on consent management platforms. The European privacy law also caused publishers to hire data protection officers, shut off open exchanges, and purge ad trackers. We can expect those trends to dominate both the buy and sell sides in the coming year.

Quite predictably, companies like Facebook are gearing up to fight California's privacy law. Since they control the most data, they have the most to lose. But instead of defending the past, ad tech should work to create a better future. Right now, there's an opportunity in ad tech and in technology more broadly to address concerns around transparency, data ownership, privacy, and monetization. We should work toward a model that puts data ownership back into the hands of consumers.

What will it look like when consumers, rather than a handful of tech giants, own their own data? In a way, not all that different from what we have today. There will still be a marketplace for digital media, but it shouldn't be one where the user is the product. Instead, the marketplace of the future should enable consent-driven data trading. It should put publishers, advertisers, and consumers in a position to safely and deterministically exchange audience intentions and interests for value. And those exchanges should be as frictionless and easy to understand as an online shopping cart. When that day comes, the next generation of unicorns won't achieve their valuations by selling data, they'll make their marks by delivering trust and transparency.

Author

Ben Feldman, SVP for strategy and innovation, NYIAX

Source

"Will Trust and Transparency be the Killer Apps of the Future?," Ben Feldman, SVP for strategy and innovation, NYIAX, 2020.

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comments (1)

Michael Donahue

June 23, 2020 4:02pm ET

Brilliant, Ben.

Pleaseccontact the new Institute For Advertising Ethics
Call me first at ANA: Mike donahue, 917-679-1692.