The researchers – Vibhanshu Abhishek from University of California, Irvine, and Veronica Marotta and Alessandro Acquisti from Carnegie Mellon University – tracked millions of ad transactions at a large US media company over the course of one week.
And despite the large sums that advertisers are prepared to pay for behaviourally targeted ads, which often involve data collected by cookies, they concluded that cookie-enabled ad impressions added just 4% extra to publishers’ revenues.
“[It is] hard to understand how much value each participant in the ecosystem is adding to the process, and whether the fees different intermediaries receive are commensurate to their value added,” said Professor Acquisti, in comments reported by the Wall Street Journal.
With some studies suggesting that advertisers are prepared to spend more than twice the price for a behaviourally targeted ad, this latest research may resonate among policymakers in the wider public debate about data privacy.
Ashkan Soltani, one of the authors of the California Consumer Privacy act and the former chief technologist at the Federal Trade Commission, said: “It is a huge finding in terms of the policy debate.
“All of these externalities with regard to the ad economy – the harm to privacy, the expansion of government surveillance, the ability to micro-target and drive divisive content – were often justified to industry because of this ‘huge’ value to publishers.”
Michael Zimbalist, the chief strategy and innovation officer at Philadelphia Media Network LLC, is also sceptical about the value of behavioural advertising for publishers, saying it was always overstated.
Behavioural targeting has been completely overhyped in its value for publishers from the day it was first invented,” he said.
Sourced from Wall Street Journal; additional content by WARC staff