Privacy Issues: Addressable Vs. Identifable Advertising

Marketers want to engage audiences. Yet most media spend still targets content, using this as a surrogate for the audiences that frequently consume this content. Until recently, it was technically and commercially unreasonable for both buyers and sellers to negotiate for subsets of broadcast media content (e.g., television, radio, newspapers, magazines, billboards, etc.) based on buyer-defined audience segments.  With the advances in programmatic media planning and execution, we have seen these barriers erode amid the rise of audience-based tailored advertising.

Concurrent with this trend has been a growing concern among many consumers about how to maintain their privacy. But in fact audience-based advertising and personal privacy are less at odds than many believe. Much confusion does exist over the definitions of key concepts in the privacy discussion – anonymous and personal identifiers, and addressable vs. identifiable advertising. In an attempt to clarify these discussions and arm both marketers and consumers with the facts needed to understand the issues at stake and the details of proposed regulations, here is a simple overview defining these four terms.

Personally identifiable information (PII) refers to identifiers that can be used to proactively locate or contact a specific individual, such as their phone number, email or physical address. Other identifiers such as full name, credit card numbers, social security numbers and license plate numbers are also referred to as PII because they can often be directly connected to phone number, email or physical address.  Thus identifiers which are both legally and commercially reasonable to transform into a proactive contact are also PII.

 Anonymous identifiers, on the other hand, are passive identifiers (such as a browser cookie,  device ID or IP addresses) that are linked to a particular application or device.  Since these identifiers cannot be used to proactively contact anyone, they are considered anonymous identifiers. For example, because a warrant is required to disclose the identity of the subscriber associated with an IP address, US federal courts have held that IP addresses are anonymous identifiers.

Addressable advertising means that the primary reason a consumer receives a tailored message is due to audience-based characteristics, such as demographic, psychographic or interest-based attributes. With the vast majority of addressable advertising, the marketer does not care necessarily about reaching a specific individual, but rather a group of any individuals that share a set of particular characteristics.

Identifiable advertising means that the ad delivered to a consumer was tailored to that specific individual, based on their PII. In other words, the marketer wants to show an ad to that specific person based on information directly associated with their PII and the identity of the individual is known at the time of delivery.  Email is a good example of identifiable advertising, since the identifier (email address) is required to proactively communicate with the specific person.

Clarifying the techniques and terms that marketers use to help deliver engaging messages to tailored audiences will be critical to advancing programmatic media planning and buying while ensuring that consumer concerns are addressed. As discussions at the industry and regulatory level progress, all parties -- marketers, regulators and consumers -- must have a common understanding of the technologies at play and the issues at stake.

Tags: programmatic, rtb
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1 comment about "Privacy Issues: Addressable Vs. Identifable Advertising".
  1. Peter Zajonc from Epsilon , August 15, 2014 at 3:12 p.m.
    These distinctions are helpful. In my mind, traditional print and TV are addressable advertising. Traditional markets for advertising demos and geos, but not specifically reaching only individuals with specific characteristics. And addressable TV and Internet advertising, again, having desired demos and geos available, anonymously, and the expectation that while the audience has the characteristics, generally, but we're not sure what individual is actually exposed to the advertising. Closing the loop by matching a purchase where we have PII to an exposed audience is a bit looser when only an audience is addressable, not the individual.