Permutive's Joe Root on the pivot to privacy

Since its founding eight years ago, Permutive has bet on privacy being a key consideration in the future of ad tech. Permutive CEO Joe Root  delves into what privacy-conscious advertising looks like – and if it’s possible. Highlights:

The GDPR was a harbinger. Most U.S. companies didn’t understand how far-reaching the General Data Protection Regulation would be to them. The landmark move to rein in the collection and use of user data without consent is not without its critics, but it set in motion a focus on privacy that led to Apple’s move to crack down on data collection and the ultimate end of the third-party cookie.

U.S. dominance in digital markets is ending. The tech industry has been mostly an American creation, dominated by U.S. platforms and largely operating along the extreme free market proclivities that are a hallmark of American capitalism. But Europe remains a regulatory superpower, and it is determined to use those powers to shape digital markets.

Consent – real consent – is inevitable. Clicking out of endless cookie consent pop-ups is a wonder of traveling in Europe, on par with being able to take a train to the airport. The GDPR led to these consent requests as ad tech’s response to the regulation, giving the appearance of consent but not really. That’s going to change.

Context is having a moment. The original targeting signal for advertising was context. Someone reading Field & Stream is likely into the outdoors if you’re selling fly-fishing gear. Digital advertising shifted to taking all kinds of signals in order to target ads to individuals. With the collection and application of other signals growing more difficult and expensive, the pendulum is shifting back to contextual signals.

Big publishers stand to benefit. The new era of digital advertising will have winners and losers, with many still to be determined. One divide that will likely open is between the biggest publishers that have enough user data of their own to be compelling to advertisers who can’t simply rely on the cookie targeting and the long tail of sites that will likely find competing for ad dollars far more difficult.