What Concerns Do Advertisers Have With People-Based Advertising?

April 14, 2016

EconsultancySignal-People-Based-Advertising-Concerns-Apr2016Almost half (48%) of North American advertisers agree that the current model for display advertising is broken, per results [download page] from an Econsultancy study in partnership with Signal. Moreover, half of respondents agree that ad blocking will make the current model for display obsolete. A slight majority of advertisers surveyed agree that typical display advertising will be replaced by relevant, data-driven advertising, though they do hold some concerns.

Indeed, a consumer backlash or new privacy regulations in response to people-based advertising (addressable media) leaves 82% of advertisers surveyed either very (21%) or somewhat (61%) concerned, per the study’s results. Roughly three-quarters of advertisers are also concerned with:

  • Giving the “walled gardens” too much information about their customers when using their solutions (74%);
  • Not receiving user-level data from the “walled gardens” like Facebook and Google, for uses like attribution (77%); and
  • Data governance issues in connection with people-based advertising solutions offered by Google, Facebook and Twitter (78%).

With respect to working with platforms such as Google and Facebook, the report’s authors note that “instead of campaign data flowing back to the advertiser, the terms of their partnership agreements mean that much, if not all, of the resulting customer interaction data is owned by these third-parties and not the advertisers.”

Currently, advertisers are most likely to have used Facebook Custom Audiences (69%) and Google’s AdWords Customer Match (63%), with fewer having used Twitter’s Tailored Audiences (40%) or Yahoo’s Custom Audiences (33%).

Despite their concerns, two-thirds of advertisers surveyed said that they are increasing their media buys of people-based advertising. That’s likely due to the success they’re seeing, as the majority say that people-based advertising performs at least somewhat better than email marketing, paid search, SMS marketing and standard display advertising. Typically, people-based marketing has been more effective for click through rates (63%) and conversions (60%), with fewer citing improvements in lift (22%).

Among those who are not increasing their people-based advertising buys, performance issues (32%) and measurement/transparency issues (32%) were the most commonly-cited, with privacy/data leakage (20%) not as great a concern.

About the Data: The study describes its methodology in part as follows:

“This report is based on an online survey conducted in January and February of 2016, using primarily third-party providers for distribution as well as some internal Econsultancy lists. Respondents from third-parties were offered an incentive to complete the survey. It closed on February 8th with 350 qualified responses. The sample was comprised of brand marketers and media buyers in North America.
Respondents were qualified for the sample based on media spend, knowledge in relevant areas, geography and seniority.”

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