Friday

29th Sep 2023

Stakeholder

True value of digital advertising has come into sharp relief

  • What has been missing from the debate on personalisation in advertising is that privacy and personalisation can go hand-in-hand
Listen to article

As the European Parliament's internal market and consumer protection committee (IMCO) prepares to vote on its opinion on the Digital Services Act (DSA) next week, the fate of targeted ads will become clearer.

There's been much speculation over what the precise outcome will be when it comes to targeted ads but the debate has highlighted how digital advertising is not a simple black-and-white issue but one that has major ramifications for small businesses and small publishers across Europe.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

Ahead of the vote, it's important to remember that targeted ads are a vital part of the day-to-day operation of thousands of businesses in Europe.

They are effective at reaching new audiences, converting those audiences into customers, and giving businesses the ability to compete and grow. Targeted advertising is more than twice as effective at reaching new customers than contextual advertising, and is a low-cost, essential tool that is particularly useful for SMEs. And SMEs drive more than half of Europe's GDP, employing over 100 million Europeans.

After the Covid-19 pandemic - which has pushed operations for most businesses almost exclusively online as lockdowns became the norm - many SMEs, which are the backbone of Europe's economy, are still recovering. They simply cannot afford to lose the ability to effectively market their products right now.

For publishers, the situation has been most challenging too.

Targeted ads command a premium that contextual advertising just doesn't match. Where traditional media outlets have faced declining print circulations, digital advertising has proven a fruitful new source of revenue for many publishers.

Indeed, at last week's European news media summit, EU commissioner Thierry Breton highlighted the dramatic drop in ad revenues seen by the traditional news media which has been grappling with a rapid digital transition.

What has been missing from the debate on personalisation in advertising is that privacy and personalisation can go hand-in-hand.

Safeguarding privacy and data protection must be paramount, and there are tools to do that, in the form of the General Data Protection Regulation (GDPR). Enforcement of the existing law should pave the way for ensuring that the data-driven advertising business model is kept in check.

We must also remember that targeted ads help to fund a free and open internet.

With 68 percent of Europeans saying they would never pay for news content online, the revenues generated by targeted ads play a vital role in supporting a pluralistic media landscape and maintaining free access to news and content.

Heavy restrictions on the ability to address marketing communications would drastically reshape the internet as we know it and restrict access to reliable sources of news to a privileged few.

In an era of rising concerns over disinformation, this would be yet another blow.

Contextual advertising, often pushed as a catch-all solution by opponents of targeted ads, is not a panacea. While it is a relevant part of the online advertising ecosystem, they simply do not deliver the same reach to new customers or return on investment that targeting can.

Giving businesses the flexibility to choose how they advertise to their customers and select the tools that serve them best is an essential element of the digital economy.

As we reach an important milestone in the updating of Europe's digital rules, we must ensure that users are empowered with enhanced transparency to make informed choices about ad-supported content – in line with the significant transparency and accountability requirements under the GDPR.

It will go someway to helping policymakers ensure the DSA becomes a successful digital regulatory framework fit for the 21st century which will drive and sustain businesses of all sizes for many years to come.

Author bio

Greg Mroczkowski is Interactive Advertising Burueau Europe's director of public policy.

Disclaimer

This article is sponsored by a third party. All opinions in this article reflect the views of the author and not of EUobserver.

EU want Facebook pan-EU advert fix for May elections

EU institutions want Facebook to relax its rules, to allow pan-European political groups to carry out EU-wide campaigns. Facebook has yet to implement the demands - posing questions on the extent to which Europe relies on the US tech firm.

Agenda

MEPs focus on Belarus, digital rules This WEEK

The debate over a successor for David Sassoli, the centre-left Italian president of the European Parliament will heat up, and Belarusian democratic opposition figure Sviatlana Tsikhanouskaya will address the plenary.

Opinion

Digital marketing should rejoice at more EU regulation

The Digital Services Act was adopted with a solid majority in the European Parliament plenary - and today, some marketing professionals weep. The result will be a fundamentally different digital eco-system, and this will change digital marketing too.

New doubts raised on tracking ads ahead of key vote

Investors and small businesses are not, in fact, as keen on tracking-based online adverts as Big Tech's lobbying efforts have claimed, new research revealed on Monday, ahead of this week's plenary vote on stricter rules for online platforms.

US senators, MEPs call to keep fossil-fuel lobbyists out of COP28

We, the undersigned members of the US Congress and the European Parliament, address this letter to the president of the United States, the president of the European Commission, the secretary-general of the UN, and the executive secretary of the UNFCCC.

Latest News

  1. EU women promised new dawn under anti-violence pact
  2. Three steps EU can take to halt Azerbaijan's mafia-style bullying
  3. Punish Belarus too for aiding Putin's Ukraine war
  4. Added-value for Russia diamond ban, as G7 and EU prepare sanctions
  5. EU states to agree on asylum crisis bill, say EU officials
  6. Poland's culture of fear after three years of abortion 'ban'
  7. Time for a reset: EU regional funding needs overhauling
  8. Germany tightens police checks on Czech and Polish border

Stakeholders' Highlights

  1. Nordic Council of MinistersThe Nordic Region is stepping up its efforts to reduce food waste
  2. International Medical Devices Regulators Forum (IMDRF)Join regulators, industry & healthcare experts at the 24th IMDRF session, September 25-26, Berlin. Register by 20 Sept to join in person or online.
  3. UNOPSUNOPS begins works under EU-funded project to repair schools in Ukraine
  4. Georgia Ministry of Foreign AffairsGeorgia effectively prevents sanctions evasion against Russia – confirm EU, UK, USA
  5. International Medical Devices Regulators Forum (IMDRF)Join regulators & industry experts at the 24th IMDRF session- Berlin September 25-26. Register early for discounted hotel rates
  6. Nordic Council of MinistersGlobal interest in the new Nordic Nutrition Recommendations – here are the speakers for the launch

Stakeholders' Highlights

  1. Nordic Council of Ministers20 June: Launch of the new Nordic Nutrition Recommendations
  2. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  3. ICLEISeven actionable measures to make food procurement in Europe more sustainable
  4. World BankWorld Bank Report Highlights Role of Human Development for a Successful Green Transition in Europe
  5. Nordic Council of MinistersNordic summit to step up the fight against food loss and waste
  6. Nordic Council of MinistersThink-tank: Strengthen co-operation around tech giants’ influence in the Nordics

Join EUobserver

Support quality EU news

Join us