Big data remains big business for advertising, despite the significant impact of COVID-19 and ongoing privacy-related changes.
The advertising and media ecosystem spent $11B on data in 2019, according to the IAB Annual “State of Data” report, released today. However, data users, compilers, and other industry stakeholders suggested that in Q2 2020 and Q3 2020, their organizations would decrease data-related spending by an estimated 10-20%.
Here are three insights that will help you to better understand how businesses use data, how they make decisions concerning data, and how data impacts consumer spending:
1. First-Party Data Takes Center Stage
In addition to investment of $5.5B on data management, process, and integration last year (a 9.8% increase year over year), the majority of respondents (57.1%) report increased first-party data use in 2020, spurred by earlier browser changes and the Google Chrome announcement in January that they will end support for third-party cookie tracking.
As companies strive toward creating faster, better, and more personalized consumer experiences through data across paid and owned touchpoints, preparations for the cookie-less future—as well as to ensure regulatory compliance—are top of mind.
2. Data Growth Sectors
Digital advertisers continue to invest in data; however, data spend declined by .08% in 2019 among terrestrial, physical, and location-based advertising, eliminating the spending gap between these digital and traditional media.
Advanced TV is experiencing significant data investment. In 2019, this category increased by 19.5% to $700 million.
First-party data is increasingly being used with third-party identity resolution solutions (37.7%) to provide advertisers with better accuracy, reach, and scale, to create audience segments, deliver targeted campaigns, and gain data-driven insights, all with privacy taken into account.
3. Privacy Concerns Mature
Privacy remains important, particularly as the California Consumer Privacy Act (CCPA) enforcement went into effect earlier this month. However, only 18.9% cited government/data privacy regulation as a top concern vs. more than half the previous year.
Nearly two thirds (62.3%) of respondents report that privacy and content management are handled in-house vs. outsourced, which indicates their need and priority to maintain control.
Business recovery from COVID-19 eclipses privacy as the top concern for 2020.
This year, the IAB State of Data report incorporates findings from the Data-Centric Organization Report, for one full view into data trends and investments.