What AI Means For GDPR-Compliant Audience Targeting
Although Google has postponed the phaseout of third-party cookies to 2023, many in the advertising world still wonder how a cookieless era will affect the industry. Criticisms surrounding Google’s Federated Learning of Cohorts (FLoC) — the initial solution to this conundrum — including privacy and antitrust issues, as well as biases in algorithms, have seemingly forced the tech giant to return to the drawing board.
While it seems like advertisers have room to breathe until 2023, the cookieless conversation must continue, especially as user privacy concerns and preferences come under growing scrutiny around the world.
As we are preoccupied with identifying whichever tech will be the successor of cookies, the real and bigger issue of privacy concerns by consumers continues to persist. The European Union (EU) has already taken a decisive stand to protect consumers against online security with the implementation of the General Data Protection Regulation (GDPR) in May 2018. Since then, replacing all other outdated data protection rules, the GDPR has shaped how personal data is captured, stored and processed, and is regularly enhanced for increased clarity and protection.
The regulation itself is far-reaching and fairly light on specifics, making GDPR compliance a daunting prospect, particularly for small and medium-sized enterprises (SMEs). Companies need not operate in the EU to be governed by the GDPR. If you process the personal data of EU residents, or you offer goods or services to such people, the GDPR applies to you even if you’re outside the EU.
However, regions outside the EU may not yet be on the same page. APAC marketers, for example, trail when it comes to first-party data acquisition and its regulation. This challenge is further magnified among SMEs, which make up 98% of enterprises in the region, who lack the resources to build and maintain their own databases.
However, whether they are equipped for it or not, businesses everywhere will have to somehow follow suit, whether by force of law and regulations or growing societal and consumer pressure. It’s time for all businesses to review their approach, take small steps toward privacy-first compliance and take the lead from GDPR, regardless of which part of the world they operate in.
How can AI level the playing field?
Given the lack of comprehensive and privacy-centric first-party data, is it still possible for enterprises to move forward and efficiently reach their target audience without using third-party cookies? There are ways to do so, and artificial intelligence (AI) is one option that can help.
Not long ago, it was unthinkable for anyone to build audiences without cookies. It was impossible to build probabilistic behavioral cohorts of sufficient scale and target them in a media tech stack. With advances in machine learning capabilities, it is possible to acquire intent-based insights on digital behaviors in real time, identify key audience segments and assist in the development of tailored media messaging.
Here are some of the ways that AI can help businesses target the right audiences at the right time using the right messages, while maintaining the gold standard for GDPR-compliance:
• AI can help make sense of massive amounts of behavioral data for precision targeting.
Combining AI algorithms with global databases of analyzed behavioral data, huge amounts of online activity can be tracked and sorted to identify behavioral cohorts. Besides only identifying relevant target audiences, AI-driven programmatic targeting identifies moments that matter and content that is likely to resonate with the audiences.
• AI collects and analyzes anonymized digital footprints.
By amassing, processing and analyzing open data — or anonymized digital footprints — targeting specific audience cohorts no longer involves private data such as browsing history.
• AI-targeting is entirely cookie-free.
Behavioral footprints can be extracted to turn datasets into unique IDs and provide insights for consumer intent and reliable indicators that predict purchase patterns.
With digital advertising continuing to grow, brands and publishers keep looking for more effective ways to market themselves and their products. With cookies on their way out, it leaves the room open for sustainable and privacy-compliant targeting solutions, such as AI-driven behavioral targeting. Major brands have already begun adopting AI to connect the right audiences with the right digital destinations at the right time, and advertisers have experienced a significant improvement on campaign KPIs.
How can SMEs start their journey to GDPR-compliant audience targeting?
First off, SMEs need to identify the challenges they face when it comes to the safe and secure use of data. Consider unmet needs in areas such as the storage or categorization of data, understanding and activation of data at scale and the actual application of AI algorithms for this generation of more accurate targeting solutions.
For SMEs that do not have the technology or expertise to build an in-house team, consider working with external partners who know how to handle their specific needs and challenges. External consultants can provide advice on how data can be safely optimized and used, while AI solutions can enable SMEs to generate behavioral insights on market segments without personally identifiable information (PII) as well as execute and track the resulting advertising campaigns.
It is important to find partners with a good track record; those with a presence in countries that strictly enforce the GDPR (e.g., Germany) tend to have the latest knowledge of the relevant requirements and updates. Those that work with major brands, especially in the finance and healthcare sectors, have rigorous codes of conduct and regulations, which is ideal.
Finally, keep an open mind when it comes to assessing whether data-driven insights and analysis are useful. These may not always align with your belief or understanding of the market but may provide valuable insights and practical information for future initiatives.
While AI seems like an overused term in this hyperdigital world, it unlocks smarter and better solutions for businesses to reach the right audiences while offering protection to individual privacy. True AI, after all, is self-learning and always improving, thereby providing a true reflection of the ever-evolving world.