Marketers Must Step Back From Personalization And Automation

“We’re privacy-centric,” said every marketer ever.

But what was once a reflexive statement must now be backed by substance. Despite excitement about harnessing data to send the right message to the right person at the right etc., marketers must now wrestle with whether they should simply because they can.

One of the major themes at AdExchanger’s Industry Preview 2019 was the call for marketers to think before they do. It’s not simply a matter of not being creepy. At stake is the growing tension between consumers and corporations that are playing fast and loose with sensitive data.

“Fast and loose” means plugging data assets into automated systems and hoping for the best. Privacy doesn’t just mean what data you’re using – it also means what systems you’re using to execute on it.

Excessive automation

“There is so much risk in automation in advertising,” said Joanna O’Connell, a Forrester Research VP and principal analyst who warned advertisers not to automate simply for the sake of automating.

Consider the companies that targeted baby products to a woman who just experienced a stillbirth. Their targeting algorithms were spot-on, and they aimed a message at someone who was, until recently, in-market for baby products.

And while every entity in the supply chain contributed to this snafu, it’s the brand that pays the price, O’Connell said during her presentation.

Consumers receiving an offensive or upsetting ad aren’t upset at the vendors or the publisher, she said. “They’re upset at the brand.”

The issue of trust doesn’t begin and end with consumers and brands – it’s part of a greater phenomenon where consumers increasingly distrust governmental institutions and media stalwarts.

This sentiment has poisoned the advertising industry.

“The erosion of trust began with companies in this room,” said Publicis Groupe Chief Growth Officer Rishad Tobaccowala during his presentation. “Marketers were worried about where their dollars were going. It first began with the tech companies, then they moved to the agencies and said, ‘You’re all liars and thieves.’ Then they decided to go to the platforms and say, ‘We don’t trust you.’ This was part of an overall breakdown in trust across the world.”

In marketing, the problem may be rooted in brands thinking of consumers as consumers, instead of as citizens.

It’s an attitude that makes it easier to commodify humans and treat their personal data simply as fuel to maximize ROI, such that a woman suffering the loss of her child is reduced to a shopper in-market for baby supplies.

“We want relationships with people with high lifetime values,” Tobaccowala said. “Can you imagine if you had a relationship with your cousins, friends, children because of ‘lifetime value?’”

And now…regulation

The problems with the way personal data has been applied has led to the current regulatory environment – GDPR in Europe and the CCPA in California, to name the two big ones – which has and continues to boggle the minds of everyone in the advertising ecosystem.

“This whole issue of trust and control will only get more important,” said Deborah Farrington, founder and cochairman of the venture capital firm StarVest Partners. “We’ve heard all about the issues with privacy, and people are really pushing back against all of this data that’s been collected without their consent. We’re going to see more things that will assist with that.”

It’s wholly possible that these new regulatory concepts are being willfully misapplied by the advertising community in their zeal to continue results-driven advertising.

GDPR, for instance, states that data controllers must have “legitimate interest” to lawfully possess consumer data. But do advertisers ever really have legitimate interest? The answer is ambiguous, and Oracle Data Cloud SVP and GM Eric Roza warns advertisers against assuming that they do.

“This whole matter of legitimate interest we don’t think is safe ground,” he said during a fireside chat. “We don’t think legitimate interest will hold up as an advertising use case. … Anybody relying on legitimate interest to do audience-based advertising is putting themselves or their company at risk.”

The Commission nationale de l’informatique et des libertés (CNIL) may have raised some eyebrows Monday when it slapped Google with a 50 million euro fine for violating GDPR, but it won’t be the last, Tobaccowala said.

“I don’t think you’ve even begun to see what’s coming on data fines and GDPR,” he said. “The 50 million euro fine for Google was pittance compared to what’s coming.”

The US might be a fast follower – if not federally, then locally.

“We do have some federal privacy and security laws in specific sectors, but for a developed country, strangely, we do not have a general privacy law,” said FTC Commissioner Rohit Chopra during a fireside chat. “I think many states see a big void at the federal level right now and are taking action. We should expect continued interest from the states on wanting to make sure if there aren’t federal-level protections that they’re filling in the gap.”

No one should look forward to patchwork rules governing data use across the United States: “This is going to be a hellhole if someone doesn’t take care of it,” Tobaccowala said.

Less personalized, more contextual

Unfortunately, there’s no reversing what has been set in motion – a bell can’t be unrung – and there’s no easy fix, certainly not from automation.

Quite the contrary, 2019 could bring penalties for businesses that use data and automation without seriously considering their activities.

“For us to assume that hyperpersonalization is always best is, in fact, dangerous,” Forrester’s O’Connell said.

Instead of hyperpersonalization, marketers should consider context. Oracle Data Cloud, as a provider of data solutions, has certainly geared up for this shift. That is one reason it bought Grapeshot’s contextual targeting business, Roza said: It was an attempt to move away from audience data.

Marketers also seem to be driving that shift.

“I’m more interested in buying environments where people want to hear certain messages,” said BlackRock CMO Frank Cooper during a fireside chat. “I think about the environment first and then how do I develop content that speaks to that environment.”

Alison Weissbrot, Allison Schiff, James Hercher, Sarah Sluis and Zach Rodgers contributed

This post was syndicated from Ad Exchanger.