Facebook‘s New Normal?

The summer used to be a relatively quiet season for the ad industry. And while it might seem that everyone‘s been running to the Hamptons or the airport of late, the data/ID world has yet to go on break. Consider all that‘s happened this week:

Crumbling walls?

Are brands ready for Apple‘s IDFA changes? When will we know that we‘re feeling the impact? For Facebook advertisers, the answers appear to be “no” and “right now.”

Facebook warned investors in recent earnings calls that it has been bracing for a hit as Apple rolls out changes that require users to opt in to ad tracking on apps in iOS. Well, Bloomberg is reporting that opt-in rates are low, and Facebook advertisers are already feeling it.

Since the changes went into effect in June, one brand executive said he‘s seeing a 57 percent gap between sales he can track on Shopify vs. what Facebook is reporting.

“It‘s been pretty devastating for I would say the majority of advertisers,” mobile analyst Eric Seufert told Bloomberg. “The big question is: Are we seeing just short-term volatility where we can expect a move back to the mean, or is this a new normal?”

Seufert estimates that the new normal could mean that Facebook‘s revenue could dip by as much as 10 percent to 13.6 percent, which is no small change for a company that has a commanding share of the digital ad market. And if that plays out, where does that money go?

The secret geek squad that runs the world (wide web)

If like most people, you are still a bit puzzled by what the W3C is and why it matters so much in the digital ad world, Protocol has a must-read deep dive on the infighting plaguing the mysterious global organization. Comprised of earnest engineering types who like to fixate on browser standards and the like, the W3C has a lot of influence over how the web actually functions. But of late, it‘s been struggling with how to deal with the shifting tides regarding web privacy and the commercial use of consumer data. It‘s not a comfortable fit. As Protocol notes, some companies that make a living on ad targeting are lobbying the group to make sure that adtech livelihoods are considered. Yet other members of the group see that sort of campaigning as disingenuous.

“They use cynical terms like: ‘We‘re here to protect user choice‘ or ‘We‘re here to protect the open web‘ or, frankly, horseshit like this,” Pete Snyder, director of privacy at Brave, which makes an anti-tracking browser, told Protocol. “They‘re there to slow down privacy protections that the browsers are creating.”

Meanwhile, giants like Google and Facebook have stacked the member ranks of the W3C with loyalists as they try to use the organization to gain approval of initiatives like Project Sandbox and FLoC while protecting their own interests. The slow-moving, high-stakes battles offer a fascinating look at who really has a big impact on this business (and it‘s not regulators).

First-party party

Even though cookies got a stay of execution, first-party data is still seen as vital to the future of digital marketing. So companies that can claim to help publishers and brands make the most of it are suddenly looking quite valuable. Enter Audigent, which just raised $19 million to build what sounds like the world‘s biggest and safest private marketplace product. It‘s a good bet that we‘ll see a slew of startups emerge, promising to build privacy-first data targeting tools over the rest of 2021. On that note, Business Insider has a new list of nine adtech companies promoting their ability to help brands stay PII safe through the use of clean rooms, data lakes and other such processes.

Boiling down the ocean

Mediaocean, the quiet ad industry billing giant, made a $500 million acquisition of Flashtalking last week, reported The Wall Street Journal. This is the latest in a string of deals for Mediaocean — which certainly seems up to…something. Yet this raises several questions, such as, why buy an ad server? Doesn‘t Google have that rather unlucrative market locked up? And what exactly are the strategic moves and connections available to a company that is primarily known for generating invoices? It will be interesting to watch. That‘s it for this week…see you next time.