Month: August 2021

Facebook said it will not allow targeting to specific lists of people or so-called lookalike audience targeting to reach people under 18, though it will continue allowing advertisers to set up campaign targets to reach people under 18 according to gender, location and age parameters.

Martin and others familiar with Facebook ad targeting say the new targeting limit on Facebook, Instagram and in Facebook Messenger — set to come into effect “in a few weeks,” according to Facebook — probably won’t affect how advertisers currently use the platform. Not only do advertisers hoping to reach young audiences tend to avoid Facebook proper, with an audience that skews older, but some spending to reach those younger people has also shifted to platforms such as Snap and TikTok, said Shamsul Chowdhury, vp of paid social at digital agency Jellyfish.

Agency execs said they expect little impact from the targeting limit on ad spending across Facebook’s properties. Chowdhury said any effect on the amount of money advertisers spend on Facebook is likely to be “nominal.” The agency’s brand clients that typically seek to attract younger audiences tend not to target people under 18 on the platform anyway, he said. “These audiences don’t perform well,” because they tend not to have much discretionary income, Chowdhury added. He also said when advertisers do want to reach those younger people they have shifted some budget to platforms such as Snap and TikTok.

Playing ball on an algorithmic court

The new targeting restriction actually aligns with Facebook’s longer-term strategic playbook, said Joe Kerschbaum, vp of growth labs at 3Q Digital. The ability for Facebook to deliver its bread-and-butter retargeted ads based on tracking whether someone viewed a product on a retailer’s site is slipping away with the rise of tracker blockades erected by Apple and the impending demise of third-party cookies in Google‘s Chrome browser. That means the type of interest-level targeting to young people the company will now prohibit is slowly losing effectiveness when it comes to reaching all audiences, he said.

“This is giving advertisers a taste of the privacy measures coming up as people adopt iOS 14,” said Kerschbaum.

Perhaps more significant, the change also reflects Facebook’s own internal strategy shift away from advertiser self-guided targeting to campaigns that leave the decision-making up to the company’s almighty ad algorithm. Indeed, marketers say Facebook has encouraged advertisers to shift away from setting up campaigns using targeting parameters and instead coaxed them to let the company’s sophisticated algorithmic process for optimizing ad targeting do the work.

“Facebook has made that suggestion to us and we’re testing it,” said Kerschbaum regarding use of the company’s automated campaign targeting.

In line with company communications, Facebook account reps over the past three or four years have told ad buyers like Chowdhury that they should use broad targeting parameters in Facebook campaigns and leave the decisions up to its algorithmic process, he said.

For instance, Chowdhury said if an advertiser wants to reach people under 18, they might set up a campaign to optimize toward revenue and leave it to Facebook to determine what the younger group is likely to do based on what people in 18-24 or 25-34 age ranges who convert do. “If you want to optimize toward a revenue target, [Facebook is] going to do the damn best to find that audience,” said Chowdhury.

While the Apple tracking changes create gaps in what advertisers know about how campaigns perform, marketers including Martin and Chowdhury said Facebook still has access to some conversion data supplied by advertisers, in part through its conversion API, that shows whether people who saw Facebook ads took an action as a result. That data is a component of what’s feeding Facebook’s algorithmic system, training it to help find people likely to take a desired action, they said.

“I’ve seen advertisers over the last year put a lot of effort into giving Facebook [their] conversion data,” said Martin.

Age detection ain’t easy

Another factor that may have contributed to Facebook’s new targeting restriction: the company itself has admitted that detecting and verifying the age of people on Facebook and Instagram is an extraordinary challenge. “While age screens are common in our industry, young people can — and often do — get around them by misrepresenting their age,” wrote Facebook’s vp of youth products Pavni Diwanji in a company blog post about using AI to remove underaged accounts and help verify people’s ages; the post was published the same day as a company post about the targeting changes. Diwanji, a former YouTube Kids exec at Google, is now tasked with navigating the treacherous seas of children’s digital services as she oversees the development of a controversial Instagram for Kids, which the firm already has said will not enable any advertising.

Facebook recognizes that the regulatory waters are getting choppier when it comes to rules preventing data use and targeting of kids and teens online, particularly in the U.K. and Europe, said a kids digital media investor and marketing consultant who did not have permission by his employer to be named in this story. “Facebook’s assessment [of what] the landscape for advertisers is going to look like legally in the next five years is you’re going to have this complete exclusion zone for kids and teens,” said the exec.

Ultimately, Facebook’s targeting restriction helps the firm soften its damaged reputation as a data exploiter in the eyes of consumer advocates and legislators who worry about kids’ privacy and the effects of manipulative ad messages on impressionable minds, said Kerschbaum. “Wherever they can get quick wins and meet consumer concerns that don’t necessarily have a huge bottom-line impact, they’re probably going to do it.” 

The Metaverse is neither a new concept nor a hologram, but it can be difficult to boil down to an elevator pitch. “It’s hard to wrap your head around something that’s so new and so different,” said Christina Wootton, vp of brand partnerships at Roblox. “As we slowly get more and more used to it, I think people will start to see why it’s so important — and why it’s real.”

The most accessible entry point into the Metaverse is massively multiplayer video games. Many Fortnite players got their first taste of the proto-Metaverse during last year’s virtual Travis Scott concert, a shared experience that allowed players to simultaneously experience a custom-coded virtual concert inside a freeform digital world. The concert was attended by more than 12 million people and remains an oft-cited example of the Metaverse’s capabilities.

Compared to a true Metaverse, however, the Travis Scott concert was a mere shadow on the cave wall. Players could only interact with up to 49 other users at a time, and the experience was closed off to users without Epic Games accounts — it was not interoperable in the way that a true Metaverse would be. According to Victor David, CEO of digital item production firm Epik, the Metaverse will be far more expansive, allowing users to move between platforms and virtual worlds without needing to shed their digital identities or eschew experiences. In other words, it will be a virtual universe that boasts all the features of the real world — and more. “What if next time, Travis Scott can do his concert in Fortnite and Roblox and Minecraft and everywhere, all at the same time?” David said.

As people warm up to the idea of a truly persistent virtual world, some companies are scrambling to put a Metaverse spin on seemingly unrelated services or products — a popular source of criticism among Metaverse skeptics. To the uninitiated, it is far from obvious why a company like Coca-Cola might be interested in auctioning off themed non-fungible tokens.

“I do understand what people are saying when these use-cases make no sense or these companies that really have no business doing anything related to video gaming or blockchain or Metaverses are starting to talk about it,” said Janine Yorio, head of Metaverse real estate investment fund Republic Realm. “That does give us all pause — but it doesn’t take away or detract from where I think the market is headed.”

Indeed, Yorio and her compatriots at established Metaverse companies are taking the long view: that the Metaverse is inevitable due to widespread cultural changes that are already well underway, including the expansion of gaming and the shift to digital life sparked by the COVID-19 pandemic. “My own children are guilty of playing hours and hours a day — you literally have to yank the computers away from them,” Yorio said. “And I don’t think that’s a behavior or affinity that’s going to die away. It is as much a part of their socialization as mobile phones are to ours.”

In the aftermath of Mark Zuckerberg’s endorsement of the Metaverse, a slew of new start-ups, venture capital funds and self-identified expert consultants have cropped up to take advantage of this latest burst of Metaverse hype. But according to those who have been tracking it for years, the eventual development of the Metaverse is not contingent on the success or failure of these companies, or even of their own Metaverse-minded concerns. They believe the Metaverse is happening without a doubt — and there’s no time like the present to get involved.

“There’s always this whole backlash to all these crazy ideas — who’s going to go rent out a room in their house, right?” David said. “All these crazy ideas seem so absurd, but then they ultimately make sense.”

Publishers enable the free flow of information and ideas which has defined the internet from the very beginning. This value exchange has historically been powered by the third-party cookie, but that has changed over the past several years, as consumers have not fully understood this exchange or how their data was being used. Their concern caused both regulatory and browser reactions. 

Consequently, publishers and brands alike have had to navigate a hyper-volatile programmatic landscape. While some may find relief in learning that Google has delayed the deprecation of third-party cookies, marketers and publishers shouldn’t see this as a reason to delay embracing post-cookie strategies. Publishers and brands who have already gotten a head start on pivoting to an addressable, cookieless solution should see this time as an opportunity to hone in on building relationships based on trust through first-party data strategies, realizing the benefits of an addressable solution that enables authenticated user experiences. 

Publishers can win with people-based marketing

Data-driven publishers that have built first-party relationships are in a position to leverage their authenticated data to enable marketers to target audiences and measure campaign outcomes with people-based identity. 

Without a transparent, authenticated solution on the open web, brands looking to reach their audiences have been overcompensating for the lack of transparency. Walled gardens have benefited from disproportionate media investments. A recent study with OpenX and Harris Poll found that advertisers allocated 60% of their digital advertising budget toward reaching audiences in walled gardens, with 40% of the budget going to the open web. Yet, consumers spent more time on the open web — 66% — compared to just 34% on the closed platforms. Walled gardens have mastered the art of leveraging their first-party authentications to deliver advertising that works better. Independent publishers have caught on, and the most forward leaning ones are now embracing the tactics formerly enjoyed only by walled gardens.

By leveraging solutions that enable publishers and brands to match identities without the use of cookies or compromising data, renowned publisher Newsweek was able to see results to better plan and execute on advertisers’ marketing campaigns. 

The Newsweek team saw a total lift in eCPM as high as 224%, with an average lift of 52% across all web browsers. Specifically, the team saw a lift of 55% on Google Chrome browsers, and a 93% and 60% lift on Firefox and Safari, respectively. 

Even though Chrome still allows for the use of third-party cookies, Newsweek benefited from an audience lift by leveraging this new ID solution. As both Firefox and Safari no longer enable audience reach with third-party cookies, the lift on both browsers enables a new, more premium channel based on authentications for marketers and advertisers to reach an audience they were not previously able to.

Newsweek’s COO Alvaro Palacios said, “Newsweek has proven through testing that digital media does not need third-party cookies to increase yields and the value of our inventory. This ID solution provides the infrastructure to match our readers with a brand’s customers, for marketing that could be more effective than with third-party cookies.”

Publishers are also seeing higher CPM on mobile devices than with cookieless mobile web inventory — Newsweek achieved a CPM lift of 53% on iOS devices, compared to those who had not implemented this ID solution. Discovery Inc. also saw an average eCPM increase of 44% when utilizing this ID solution across its sites. 

These CPM improvements illustrate the incremental revenue opportunities achieved by leveraging an authenticated solution. As publishers continue to grow their addressable inventory, their revenue will grow too. Brand marketers can now buy inventory activated by authenticated, first-party data to reach more consumers on more channels than ever before — something third-party cookies could never achieve. 

Empowering publishers and brands to reimagine a new ecosystem 

While third-party cookies still exist, for now, a more viable solution is already available that advertisers should take advantage of. For example, 5G is 100 times faster than 4G and provides better connectivity, leading to seamless user experiences. Because of these innovations, 5G has become the preferred connection while 4G still exists. In the same way, authenticated cookieless solutions have become the preferred solution while third-party cookies remain. These authenticated solutions have already proven themselves to be more effective. 

The digital advertising industry constantly balances the sometimes-competing interests of publishers, brands and browsers, but the most proven viable alternatives to third-party cookies benefit brands and publishers equally. Browsers provide a new mechanism for consumer transparency between brands and publishers and are as significant as patrons of a restaurant knowing who supplies the ingredients to their favorite dishes. The authenticated solutions offered by browsers support a healthy value exchange between a brand and publisher. The browser — like the restaurant supplier — is simply a means to an end. The result is an experience that consumers desire. 

To get ahead of changes made by browsers, publishers must own their trusted first-party consumer relationships through authenticated solutions. Publishers succeeding in establishing this trust with their consumers will be able to develop a relationship independent of cookies, improve the user experience and increase yields for publishers and the brands that work with them.