Advertising Contextually Isn't a Direct Replacement for Targeted Advertising

Advertising Contextually Isn't a Direct Replacement for Targeted Advertising

The Irish Council for Civil Liberties (ICCL) has released a report comparing the revenue generated from contextual and targeted advertising among EU publishers. The report, titled "The Biggest Data Breach," primarily focuses on the data privacy harms related to Real-Time Bidding (RTB), a programmatic advertising process that involves the real-time auctioning of user data to target ads.

However, the specific data sets and methodologies used for the revenue comparison in the ICCL report are not clearly detailed. The report is more concerned with highlighting the widespread privacy breaches caused by RTB’s data sharing practices than providing a granular financial revenue breakdown or detailed statistical methods.

The ICCL's critique of RTB touches on regulatory and privacy concerns stemming from its data-heavy methodology. The report also suggests that a Norwegian news publishing group earned an average of 391% more for contextual ads than tracking-based ads over 12 months. Moreover, the report claims that switching off tracking-based advertising can increase ad revenue for publishers, as demonstrated by a 149% increase in advertising revenue when Dutch publisher NPO Group replaced tracking-based ads with contextual-based ads.

Despite these claims, it's important to note that the report uses data provided by Kobler, a Norwegian company that sells contextual ads to publishers. This could potentially bias the results. Furthermore, the report does not mention any independent validation or verification of the data provided by Kobler.

In the broader context, revenue comparisons in studies of advertising types often involve analysis of industry data on advertising spend from digital ad exchanges and publishers, econometric modeling to estimate revenue impacts, and regulatory and transparency documents from ad networks or regulatory complaints and investigations. The ICCL has made formal complaints regarding data misuse in this space and the European regulatory landscape, pointing to systemic issues around the legality and fairness of targeted advertising practices under EU law.

It is not clear how many of these publications may have already implemented changes to their websites that significantly reduced their use of third-party data that could allow for targeted advertising. As of late November 2021, TV2, a major Norwegian news website, still uses targeted ads.

The ICCL is an advocacy group pushing for a ban on targeted ads in the EU. Those defending targeted ads are not trying to ban contextual ads but argue that targeted ads are more effective and generate more revenue. The chief policy officer for Brave, a company that sells contextual advertising, provided the analysis cited by the ICCL report.

Online advertising in Europe generated nearly €70 billion in revenue last year, with a significant portion coming from targeted ads. However, after the EU implemented the GDPR in 2018, NPO began asking users for consent to show targeted ads. 90 percent of users did not opt in, which means it could only effectively deliver targeted ads to 10 percent of its users.

In summary, while the ICCL report clearly critiques the underlying data practices (particularly around RTB and targeted ads) from a civil liberties perspective, the exact underlying data sources and quantitative methodologies used in their revenue comparison between contextual and targeted advertising in EU publishers are not detailed in the publicly available summaries or search results. Further access to the full ICCL report or direct inquiries with ICCL would be required for a precise description of the data and methodologies employed.

1. The Irish Council for Civil Liberties (ICCL) report, titled "The Biggest Data Breach," primarily focuses on data privacy harms related to Real-Time Bidding (RTB), a programmatic advertising process that involves the real-time auctioning of user data to target ads.
2. The ICCL's critique of RTB touches on regulatory and privacy concerns stemming from its data-heavy methodology, suggesting that a Norwegian news publishing group earned an average of 391% more for contextual ads than tracking-based ads over 12 months.
3. In the broader context, online advertising in Europe generated nearly €70 billion in revenue last year, with a significant portion coming from targeted ads, but after the EU implemented the GDPR in 2018, NPO began asking users for consent to show targeted ads, and 90 percent of users did not opt in.
4. Despite the ICCL's claims, it's important to note that the report uses data provided by Kobler, a Norwegian company that sells contextual ads to publishers, which could potentially bias the results.
5. The ICCL is an advocacy group pushing for a ban on targeted ads in the EU, with those defending targeted ads arguing that they are more effective and generate more revenue.
6. It is not clear how many EU publications have already implemented changes to their websites that significantly reduced their use of third-party data that could allow for targeted advertising, as of late November 2021, TV2, a major Norwegian news website, still uses targeted ads.

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