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Online advertising 2.5 years after the implementation of the GDPR: what are the lessons learned?

8 december 2020

On the 25th May 2018 the privacy legislation was tightened, with significant consequences for the online advertising world. Much has happened since. For instance, on the 1st of January 2020 Ster stopped using advertising cookies completely. What did the road leading from cookies to no cookies look like? And what are the lessons learned 2.5 years on from the GDPR coming into effect? In this blog, I, team manager of the online team at Ster, look back at the past 2.5 years and into the future of advertising without using personal data.

Text: Tom van Bentheim

Let’s rewind: why advertise without cookies?

Privacy is a hot topic, especially now that we spend more and more time at our screens. We become more privacy aware and want to know what happens to our data. This proved to be anything but transparent: what data was being used for advertising purposes? And who was using it? Not only the consumer struggled with these questions; there were unclarities for brands, as well: due to the various (invisible) intermediaries in the online advertising chain it remained unclear for a long time where their advertising money actually went.

In 2018 this prompted politicians, online parties and visitors to take a critical look at the way in which personal data was processed. The consequence was a tightening of the privacy legislation¹, which resulted in so-called cookie screens whereby visitors can choose upon opening a website if and which cookies may be placed.

Naturally, these screens appeared at the websites and apps of the NPO (the Dutch public broadcaster, for which we sell advertising space) too: visitors initially had to consent to the placement of cookies in order to gain access to the NPO content (see the image² above of the screen you saw while installing the NPO app). This manner of requesting consent immediately created uproar, which led to the public broadcaster switching to a different module in April 2018 whereby visitors could explicitly choose which cookies would be placed without losing access to the content:

This step immediately resulted in a large loss of online advertising space. Because only one in ten visitors to the NPO websites consented to placement of advertising cookies, Ster lost 90% of its digital inventory. A clear signal from the public and a reason for us to look for a privacy-friendly way of online advertising: is it possible to serve ads without using personal data?

Because only one in ten visitors to the NPO websites consented to placement of advertising cookies, Ster lost 90% of its digital inventory. A clear signal from the public.

An initial idea

Due to the great impact of the new privacy legislation rapid action was required: on Friday the 25^th of May 2018 the new legislation would take effect and the following Monday, thanks to Floris Brouwer, web developer at Ster, we had a proof of concept. This version made it technically possible to serve ads without using personal data. There were however still points of improvement: the commercials were served randomly across the entire NPO network (Run of network, RON) and clients had no insights into the number of impressions and clicks.

In consultation with Ster director Frank Volmer we decided to charge half the regular CPM³ price for this new method of online advertising. Remarkably, large brands immediately came on board and the first campaign for online video without cookies went live on 5^th of June 2018– within only two weeks of the new GDRP taking effect. And it didn’t stop there. To my surprise, online video without cookies sold out within a timeframe of two months: the NPO content proved to be sufficiently strong and valuable to validate the lack of figures.

From concept to product

So, the first concept seemed viable: supply and demand met without the involvement of any personal data. That offered us a basis from which to keep building and by then we could return to 75% of the initial price level.

Of course, this first version still had some cons: there was only one person who was able to put everything live, change material or even change the start and end date of a campaign. That needed to change: so in order to scale up, we went in search of a partner. We decided – in consultation with our formal SSP⁴, SpotX– to set up a collaboration with Adscience. Together with Adscience we developed functionalities with which the quality and options for advertising without cookies at Ster could be enhanced. This resulted in an adserver with which we could serve commercials without using personal data on a larger scale.

What is it worth?

One of the questions I am frequently asked is: what is the value of online advertising without cookies for our clients? Previously, after all, cookies were used to reach a specific target group, follow viewers or maintain a certain contact frequency. Is such an analysis possible without cookies, as well?

In order to find a valid answer to this question we conducted a study in 2019, together with Omnicom. At that time we were still offering advertising space both with and without cookies, allowing us to make a good comparison. By running campaigns twofold, half of the budget on inventory with cookies and half of the budget on inventory without cookies, we got a good understanding of the differences.

You do not need cookie data to realise a good performance from your campaign.

The campaigns were analysed on all brand key performance indicators (KPI’s). We – for instance – looked at the time spent on the pages and the number of page views, but also at the ultimate objective of a campaign: its actual conversion. The conclusion was the same each time: you do not need cookie data to realise a good performance from your campaign. Meanwhile the campaign requests continued to come in and we were even delivering our campaigns without cookies on our advertising space with cookies.

And that’s not all: another wonderful side effect, of value to our clients, is that with advertising without cookies we are also bringing back the transparency of the online advertising chain. Because a direct link is made between the client and the content, fewer (invisible) intermediaries are needed. This way you know where you stand and where your money goes. Because, for example, campaign budget no longer leaks away to these invisible intermediaries, as research into the programmatic landscape shows, you can in addition increase your presence for the same amount of money.

Targeted advertising without cookies?

Despite these good results being achieved through advertising without cookies, the need for targeted and relevant placement of the online ads remained. After all, many brands want to target or exclude as specifically as possible and so our next question was: how can this be made possible without the use of personal data?

The answer to this question turned out to be: contextual targeting. With this manner of targeting commercials are relevantly placed, based on context. Together with Rick Hoving, data scientist at Ster, we set up a module that made it technically possible to target on programme, title and device. This principle was not new, but we did improve it. After all, only looking at titles is not enough. Take the programme een huis vol (a full house), for example: if we only considered the title there, it would fall in the category of ‘Home and decorating’, but in reality the programme is about families.

Therefore, over time, the description, the url and the subtitling began to play a part in determining the topic of an online clip or page. In order to determine the content of an online clip or page as specifically as possible, we now look at all the possible metadata. This way the topic can be determined exactly and we can place a commercial alongside the most relevant content. The result is a system of contextual targeting that is accurate in approximately 90% of all cases.

Is contextual targeting effective?

The usefulness of this new method of contextual targeting is clearly demonstrated when we look at talk shows, which previously automatically fell into the category of ‘News and Current affairs’. Talk shows, however, have different guests on each show and varying topics and discussions and these conversations can sometimes take off in unexpected directions. By analysing the subtitles, among other things, it is possible to determine exactly which topics or themes are discussed and whether a certain commercial is suited there.

This offers brands a good alternative to advertising based on personal data and means they are still able to reach the most relevant target group. This is also apparent from our research: campaigns were analysed to see whether this method of contextual targeting also had the desired effects on campaign results. The answer was a resounding ‘yes’: this method of advertising works. The results regarding traffic to the website and the final conversion are better than a in a run of network campaign with or without cookies, but also better than, for example, a campaign with demographic targeting.

This method of advertising works. The results regarding traffic to the website and the final conversion are better than a in a run of network campaign with or without cookies, but also better than, for example, a campaign with demographic targeting.

A result that did not go unnoticed our solution gained both national and international interest. Wired wrote an article on it, Dutch public media, such as NRC, also discussed our solution and we were recently nominated for a privacy award. In my opinion this emphasises the need for advertising without cookies.

Where are we now?

2.5 years later, I look back with great satisfaction. We have found a solution that pleases everyone: the audience – who are more aware of their privacy than ever before – can use a completely safe network and our clients achieve equal – or better – results without cookies. In addition they benefit from the fact that there are less (invisible) intermediaries involved to claim a slice of the campaign budget: by making the chain transparent you know exactly what you are spending your money on and you gain greater visibility for the same amount of money.

For publishers advertising without cookies can also be a good move: we, too, use third parties less frequently now, which means a reduction in costs, we are in control of our network and we see a positive effect on our revenue. Despite COVID-19, whereby we had much extra space available, large events were cancelled and clients – understandably – cancelled their campaigns, we see an increase in the online revenue in 2020 compared to 2019:

Where do we go from here?

Despite the technology, innovations and results, we are unfortunately forced to stop online advertising at Ster to a substantial extent. It is the ministry’s wish to no longer display commercial messages online. To a large extent this will take effect next year already: most of our online products in 2021 will only be possible for parties with a message of general public interest, such as cultural organisations, charities and political parties.

Good reason for Ster to look at making our technology widely available to other publishers worldwide. Advertising without using personal data is interesting to all parties, after all: the audience, the brand, and the publisher all benefit!

Advertising without using personal data is interesting to all parties: the audience, the brand, and the publisher all benefit!

Naturally, there are still steps to be taken and we want to continue to improve the technology. For instance, one of the things we want to do is investigate ‘emotion targeting’: determining the sentiment of an article or clip. Take a BBQ commercial, for example, which is relevant to reports about the warm weather, yet must not be placed around content on heat wave warnings. Attributing a positive or negative sentiment around content is currently done manually, but we would like to automate this in the future.

And there are other issues: can we, for example, work with real time bidding for advertising without cookies? And how can we improve the product, creating a sustainable solution that benefits the entire industry?

Do you have ideas on this, would you like to know more about the developments for advertising without cookies or use our online options? Then please do not hesitate to contact us!

¹General Data Protection Regulation

²Source: Kortweg, D. NPO crashes into the tracking wall. Bits of Freedom. 2018

³Cost per mille/cost per thousand

⁴ Supply-side platform: technology with which publishers can manage, sell and optimise their advertising space.

More information about advertising without personal date

Would you like to know more about advertising without cookies? You can find all questions and answers here. You can also apply for our study ‘A future without advertising cookies? It’s possible!’ free of charge or obligation on this page.