The New Stage of Privacy: Main Factors and Prospects to 2024
We stand on the threshold of digital advertising evolution. Outdated technologies based on third-party cookies are losing out to new innovations built on artificial intelligence and machine learning.
New data security laws such as the General Data Protection Regulation (GDPR) in the European Union and the California Consumer Privacy Act (CCPA) in the US give users more control over their personal data and require companies to adhere to higher data processing and storage standards.
Advertisers and platforms like Google must change their approach to data collection and use and look for new opportunities to integrate artificial intelligence into their advertising products.
In this article, we'll look at how to keep your marketing strategy stable, future-proof it, and learn how to use artificial intelligence to create more personalized and relevant ad campaigns while respecting data privacy policies.
Oleksandr Tysmenetsky, Director of Google Division Admixer Advertising, highlights three main factors of changes in the field of privacy and recommends that advertisers take certain measures to be ready for these changes.
Three factors of privacy changes: Privacy, Economics and AI
The first factor is increased attention users to the problem of data privacy.
According to Deloitte research, 81% of surveyed users are concerned about how advertisers use their personal data. In this regard, developed countries have introduced legislation limiting the use of user data without their permission. Legislative initiatives such as the GDPR in the European Union, the CCPA in the State of California, and the LGPD in Brazil have been formulated to respond to these user concerns. As such, around 75% of the world's population is now covered by the new data privacy laws.
In addition, by the end of this year, Google plans to completely ban third-party cookies (so-called 3rd Party Cookies), which will also help protect user privacy, but will affect the effectiveness of advertising campaigns.
It is worth noting that according to surveys, 75% of users prefer advertising over paid services.
The second factor is long economic uncertainty. 75% of surveyed marketing directors say that with a reduced budget, they strive to achieve greater results and increase profits. 33% of CFOs believe that advertising spending will either decrease or remain at the same level.
Consequently, the expectations for marketing to increase profits on a limited budget and comply with regulatory restrictions and the prohibition of third-party cookies are increasing. In such a situation, the question arises - how to ensure the delivery of relevant advertising to the target audience when the number of signals from analytical systems decreases?
The third factor of change is artificial intelligence. Google has already been investing in artificial intelligence for over 10 years. Today, more than 80% of Google advertisers use at least one tool with built-in artificial intelligence. According to forecasts, in the future about 80% of all digital marketing will use artificial intelligence. For the effective operation of artificial intelligence, first of all, relevant user data, obtained with their consent, is necessary. The more targeted and reliable this data is, the better the artificial intelligence will work. Therefore, the main task of advertisers is to collect quality data for the development of Google's artificial intelligence and to maximize the results of their advertising campaigns. Those companies that follow this path see at least two of their key KPIs grow by more than 50%.
Artificial intelligence and conversions: past, present, future
Artificial intelligence is not a novelty that is only at the beginning of its development. Google developers introduce new innovations and capabilities of artificial intelligence year after year.
In 2018, 90% of site conversions (e.g. e-commerce) were easily trackable and known. Most user actions were tracked and analyzed. 10% of conversions were generated using artificial intelligence algorithms.
To date, we have seen significant progress: 20% of conversions are modeled by artificial intelligence and machine learning algorithms. It is predicted that in the near future about 50% of all conversions will be the result of such algorithms. This means that we will not have a precise identification of users, but indirect signs and signals such as hashed data will remain. This suggests that AI modeling will become a key factor in determining conversions due to the growth of data and the improvement of machine learning technologies.
Artificial intelligence will not replace specialists, but will complement their work. He will take on a role in choosing a platform for advertising, determining bids and other areas where the analysis of a large volume of data is required.
The power of data combined with Google tools
As already mentioned, to effectively model the user journey, even the most advanced artificial intelligence algorithms need adequate data for training and initialization calculation However, the data that advertisers and marketers received from third-party providers is out of date and cannot be updated in the required format. Therefore, marketers are left to rely on their own data.
For this, a form must be installed on the site, which allows collecting first (1st party) user data. For example, a brand may offer a discount or incentive in exchange for an email address and information.
Once an email address has been received, marketers may use it for a variety of purposes:
- a newsletter subscription offer;
- tracking activity and preferences on the site;
- collection of additional information.
The importance of 1st party data for businesses cannot be overestimated. They are the basis for a system of learning artificial intelligence algorithms that analyze user behavior and make more accurate marketing decisions.
Such a systematic approach, which covers 1st party data collection, Consent Mode, browser identification and artificial intelligence capabilities, gives companies the opportunity to improve personalization, increase the effectiveness of their advertising campaigns and obtain greater results in audience segmentation and predictions of consumer behavior.
Conclusions and recommendations
According to forecasts, changes in the privacy environment will affect 75% of the global population, so it will be impossible not to pay attention to the new privacy rules. To successfully adapt to changes in data privacy standards and build a solid foundation for your marketing strategy in 2024, our experts recommend taking the following steps:
- Switch to Google Analytics 4 (GA4). If you haven't already, please do so as soon as possible. This will give you access to more modern and powerful analytics tools for tracking and analyzing data.
- Set up and activate Consent Mode (consent banner) for European Union (EU) audiences according to Google's instructions. This will allow the data of consenting users from EU countries to be transferred to your GA4 account without loss. You can use paid Consent Management Platforms (CMPs) recommended by Google or set up consent management yourself.
- Update Google SDK for mobile apps and Google API. If you work with mobile apps or share data between different advertising platforms through the Google API, make sure your tools and API are updated to the latest version available.
If you require further advice on these issues or other aspects of privacy and data strategy for your business, please contact our Admixer Advertising specialists at email. Since 2016, Admixer Advertising has been an official Google Marketing Platform reseller in the EMEA region and a certified Google partner.
Our experts are ready to help you gain access to advanced advertising technologies, analytical, creative and cloud platforms, as well as improve their use in your business.
Sources:
1. Deloitte: Digital Consumer Trend Survey 2020 2. Gartner: The TOP 8 predictions for 2021-2022 3. IAB Research 2021 4. Gartner Research May 2023 5. Ipsos via eMarketer June 2023 6. GroupM & MMA India Mobile Marketing Ecosystem Report 2020 7. GroupM AI Powered = Fully automated across inventory and fully automated inventory specific
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Discussion of the topic – The Privacy Era 2024: Innovation and Data Protection
Today, we are witnessing a transitional period in digital advertising, where the technologies of the future are changing the perception of personal data protection. In this article, we look at the key trends and perspectives in the field of data privacy in 2024.
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Oliver
Interesting article about changes in digital advertising! Deloitte shows that users are increasingly concerned about the privacy of their data. How do you feel about this? 🤔
Sophia
The introduction of new technologies and privacy requirements is an interesting direction of development. I think it will bring more control to users, but advertisers will have to adapt. 💡
Manuel
75% of the world's population is protected by data privacy laws, which is an impressive figure. New technologies do affect our privacy. Do you think this is a positive step? 🤔
Alessia
Google's project to ban 3rd Party Cookies is sure to cause waves and force industry representatives to rethink their strategies. What do you think will be the consequences of this change? 🤯
Victor
It is interesting how artificial intelligence will help adapt advertising to new realities. Are companies ready for this challenge? 🧐
Elena
Protection of personal data is an important topic nowadays. What means would you use to preserve privacy under the new legislative norms? 🛡️
GrumpyOldMan
All these new trends and laws are a shame. Who knows why we have to leave our data in the hands of big corporations. Only noise and poverty! 🙄