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These Startups Help Marketers Get Around Apple’s Privacy Change

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The beginning of the Great Adpocalypse can be traced back to April 2021, when Apple released its iOS 14.5 update and started enforcing a policy called App Tracking Transparencypreventing apps like Facebook from tracking iPhone users across other apps and the mobile web unless mobile users opt in.

Less than a month after the update was released, a report showed that 96% of US iPhone users had opted out of being tracked. Not only did that hurt Facebook’s advertising business, at the pace of a an estimated $10 billion by 2022— but also sent online marketers scrambling.

Suddenly it was a lot harder to show targeted ads based on people’s internet activity, and to get the data needed to get the most out of their ad money. But a new group of startups is helping marketers get around some of those privacy filters.

This comes as the Federal Trade Commission recently announced: a possible crackdown on “commercial surveillance” and began seeking public comments about the harm of “collecting, analyzing and monetizing information about people”.

At the same time, the dual US Data Privacy and Protection Actthat would drastically impact companies’ ability to collect and leverage data is making its way through the US House of Representatives.

Meanwhile, after several delays, Google has said that its Chrome browser – the world’s most widely used – will eliminate the use of third-party cookies for user tracking by 2024 (Safari and Firefox took this step years ago) is replaced by new technology that it claims to allow ad targeting “without relying on cross-site tracking IDs.”

“A lot of what we do in the digital world relies on cookies,” said Melissa Chase, managing director at Boston-based agency Decibel Media. A cookie, she says, “is really just a bit of code that follows someone and allows us to attribute their actions to our advertising investment, which is what every customer wants to see.” (Google’s third-party cookies, for example, are located on millions of websites and give the company information about the sites you visit, allowing it to place such eerily relevant ads.)

The crackdown on third-party tracking has spawned a new breed of “digital attribution” startups:triple whale, North Ray, hyros, Bad reportsand rocker box, to name a few. They promise to track and sync conversions (sales, signups, etc.) across all your marketing channels, and to accurately credit every touchpoint in the customer journey, all without using cookies or other third-party tracking.

“There are a lot of things that are really valuable when we look at Google’s Facebook analytics and reporting,” said Austin Harrison, CEO of 3-year-old San Francisco-based company Northbeam. “Where we come in is looking at the overlap between the two.”

As Facebook conversions have become “blurred” to track, many marketers have spread their ad spend across more platforms. It’s a way to hedge their bets, but it also adds to the challenge of figuring out which specific ad, paid search link, or Instagram story led a customer to buy a product or engage in a site to register. Let’s say a user posts a Facebook ad, does a Google search and views some content on TikTok and then buys something a few weeks later.

“Such a customer journey is [usually] hard to follow,” Harrison says. “We’ve built cutting-edge technology to help you understand [what channels]paid or unpaid, will generate revenue today – and predict what will be profitable in the future.”

All of these platforms—with subscriptions that cost a few hundred to several thousand dollars a month—essentially work by collecting, cleaning and analyzing so-called first-party data, which consists of information collected on a company’s own platforms, such as visits, views, clicks and purchases on the website, mobile app, social media accounts, email, SMS and more.

[These platforms] use first-party data for things that are known (sales, phone calls, landing page visits) and sync that data across the different advertising platforms (Facebook, Google, etc.) they use,” explains Jonathan Wilson, a software consultant at Wolters Kluwer and an independent digital marketing consultant. “Then they use their own algorithms to estimate the attribution based on how the data is set up.”

It’s a way to triangulate where your traffic is coming from without actually tracking people from your site, essentially filling the data gaps caused by the Great Opt-Out.

Since Facebook can’t track users outside of its site to measure conversions directly when third-party tracking is disabled, it’s basically up to the advertiser to share their own first-party data with the advertising platforms (via Facebook’s or Google’s conversion application programming interfaces) , for example), to determine which ads convert into sales, signups, and other promotions. Without this data, a company’s ability to target its social media ads to the kinds of people likely to make a purchase is pretty limited.

Harrison, of Northbeam, says his platform only looks at “first-party data, opt-in people.” That is, people who clicked ‘accept’ for site-specific cookies, or better yet, signed up for a newsletter, opened an account, etc. “We think privacy is super important,” he says.

The reality is muddier, though, and Northbeam and its ilk — and pretty much everyone dealing with digital marketing these days — likes it that way. The details are often hidden in jargon about “solving user identity” or “recovering lost data”. But the fact is, even if you don’t provide any information voluntarily and you opt out forever, companies can still create a remarkably granular user profile of you using only publicly available data.

The techniques are well known to digital forensics experts and hackers, said Dominic Villeneuve, head of cybersecurity at a Canadian insurance company and an “ethical hacker” who finds and reports errors in software as a hobby.

“Cookies are an inexpensive way to track a user,” he says. “But you can do the same with the server side [data]. You just need more computing power, and you have to screen all the data.”

Cookies are an example of client-side tracking, meaning they collect data directly from a user’s device. But when the user clicks on a site, it collects a ton of data on the server side, including things like an IP address that gives the user’s general location and Internet service provider, as well as the type of browser, device, and operating system they are using. It also contains referral data showing the site the user just came from.

Using server-side data, for example, a company like Amazon can see that you have an IP address that is shared with three other users on different browsers and devices, and find out that you are probably a family who loves technology and money. spend has been working on it. And because it also sees that your devices are made by Samsung, it ensures that you get notifications about the latest Samsung products on Amazon.

Companies can combine server-side information, such as your IP address, with whatever first-person data they have – an email, social media account, phone number, previous purchases, etc. They can also “enrich” it with information collected publicly available from internet sources or purchased from third party data brokers.

“First party data combined with a few other data points can lead to quite granular profiling and tracking,” said Calli Schroeder, global privacy advisor at the Electronic Privacy Information Center, an independent, nonprofit research center that focuses on emerging privacy and civil liberties issues. “But I do think there are some important details. With first-party data, the consumer is often much more aware that he is interacting with that party. When I’m on a news site I know pretty well that they see my activity and maybe get some information about me, but I choose to be on that site.

“It’s very different from visiting a news site and hundreds of other companies that I don’t interact with, putting trackers on me,” she adds. “That more direct interaction is in any case good when it comes to expectations and notice.”

In the US, the major changes in digital privacy have been mainly led by industry rather than government. California’s Consumer Privacy Act, issued in 2020, is an exception. There, but also in the European Union, which enacted the sweeping General Data Protection Regulation in 2018, advertisers are more limited in the data they can collect. In particular, under those laws, IP addresses are considered personal information that cannot be collected for the purpose of creating consumer profiles.

However, such a rule is unlikely to come out of Congress or the FTC in the foreseeable future, so marketers will continue to have access to a range of workarounds for third-party tracking, such as those offered by attribution platforms.

While the long-term trend is toward more privacy protections, digital privacy is a moving target. And for digital marketers, so are you.

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