While behavioural advertising/cookie-based targeting has been a key revenue strategy for publishers in recent years, a new study in the US has questioned whether there is real “value” to publishers using the medium at a time where the online advertising ecosystem is rapidly changing.
Looking into the impacts of behavioural ad-targeting on online publishers’ revenue, researchers at the University of Minnesota, University of California, Irvine and Carnegie Mellon University in the US tracked millions of ad transactions at a large US media publisher over the course of one week. The results found that publishers receive only a 4% increase in revenue from ad impressions that are served with cookies enabled than those that aren't.
Despite advertisers often paying for these types of ads, these findings, as reported in the Wall Street Journal, shines an interesting light on the digital advertising strategies publishers currently adopt. The digital economy remains as fast-paced as ever with ad tech companies such as Google and Facebook experiencing significant growth from advertising sales whereas traditional media publishers continue to lose out. Not to mention the recent privacy settings updates to improve the user online experience giving consumers more control over their browsing while reducing advertisers and publishers access to personalised data.
This study paints a gloomy picture of how just much publishers are being affected by the updates within the digital landscape, netting low revenue gains from such widely adopted strategies.
“It is a huge finding in terms of the policy debate,” Ashkan Soltani, one of the authors of the California Consumer Privacy Act told the Wall Street Journal.
“All of these externalities with regard to the ad economy—the harm to privacy, the expansion of government surveillance, the ability to micro-target and drive divisive content—were often justified to the industry because of this ‘huge’ value to publishers.”
Check out the Wall Street Journal article for further findings and commentary into the study.