Aussie publishers break free from Big Tech: The power of a consent-based first-party data model

A seismic ad tech quake recently hit the world, and Australia was at the epicentre.

First, Facebook surprised everyone by pulling the plug on news sharing on its platform for all its Australian users – only to put it back a few days later.

Then, it was Google’s turn. The company formally announced the end of its third-party cookies, on which most publishers rely on today, confirming it would not be building alternative identifier system.

Conversations around the sustainability of the current ad tech model are nothing new. What is new however, is the evidence we have of just how unstable the current ad tech environment is. We have experienced the power of Big Tech and have a new appreciation of the impact an overnight decision can have on an entire industry. As an example, in the first 24 hours publishers were deprived of sharing news on Facebook, several of our own clients took a 30% hit on their impressions.

There is no doubt for anyone involved in Australia’s publishing and advertising that the current ad tech model needs to change, and the over-dominance of the Big Tech needs to stop. The question is, how?

Legislators and regulators have already taken some steps, for example with the ACCC’s extensive Digital Advertising enquiry – the final findings of which will be revealed in August. However, changing the model and building a new one with less reliance on technology giants won’t happen if we don’t radically change what’s at the core of that over-dependency – the data collection and monetisation model itself.

The need for liberation

Data is at the core of the ad tech supply chain model. The challenge is that most publishers and advertisers rely on third-party consumer data which is monopolised by only a handful of players.
The over reliance on cookie-based identifiers for the delivery of targeted display and video advertising, for example, has resulted in publishers under-investing in the collection of first-party data.

For any new ad tech supply chain model to work, and for healthier competition to arise while keeping consumers’ privacy intact, revisiting the ad tech data collection model and giving more ownership to publishers is key.

Quite simply, the current model won’t sustain itself if:

  1. we keep almost exclusively relying on Big Tech for data collection and monetisation
  2. advertisers keep paying more to reach their audiences while publishers continue to receive too little revenue for their advertising inventory, and
  3. consumers’ privacy and access to quality content aren’t protected

The power of a consent-based, first-party data model

In order to restore balance, and give power back to publishers, we need to move to a first-party data collection model, where data is owned by the publishers instead of them relying on third-party cookies. This, in turn, powers the creation of addressable audiences for revenue generating activities.

It also means publishers can increase audience engagement, grow their value proposition for advertisers, and give consumers quality journalism for free while protecting privacy.

For this model to work in the long term, it must address the main criticisms around privacy and transparency that the Big Tech industry has fuelled. It is important we focus on building a first-party data collection model that is consent-based has a clear value exchange for all.

Consumers should consent to sharing their data, and understand how that data will be used, and need to receive a value exchange for it that they deem worthy enough (for example, quality content from publishers). There is a responsibility for publishers and advertisers to be completely transparent and explicit around that value exchange in order to build trust.

It is also key that ad tech and media companies become only “data processors” and leave “ownership and control” of the data to publishers and brands with whom consumers engage. Why? This will build greater trust between those stakeholders.

A brave new world for publishing

The ACCC’s efforts into investigating the ad tech supply chain, and the actions taken following the final report due in August 2021, have the potential to change the ad tech industry for ever.

We have a unique opportunity to show the world that a new, healthier publishing model is possible.

It’s not about solely legislating the power of Big Tech, empowering independent publishers is critical.

Peers, legislators and regulators need to work together to build new models and systems that bring balance back into the industry. As part of this, it is imperative we change the current data collection and monetisation framework which lies at the heart of the issues faced by publishers today.

This opinion piece was originally published in AdNews.

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