Advanced Advertising: What Companies Need to Know About Programmatic Buying and Cross-Device, Cross- Platform and Cross-Screen Tracking

Transcription

1 Advanced Advertising: What Companies Need to Know About Programmatic Buying and Cross-Device, Cross- Platform and Cross-Screen Tracking Greater New York Chapter Association of Corporate Counsel December 1, 2016 James Taylor, Loeb & Loeb LLP Susan Israel, Loeb & Loeb LLP 2015 LOEB & LOEB LLP

2 Advanced Advertising - Today s Topics Programmatic Buying & Cross-Device, Cross-Platform and Cross- Screen Tracking The Deals and Legal Landscape General Enforcement Trends Keys to Compliance & Best Practices What s On the Horizon LOEB & LOEB LLP

3 Programmatic Advertising LOEB & LOEB LLP

4 The programmatic mediabuying marketplace is projected to expand 27% to approximately $18.7 billion this year - Magna Global Mobile programmatic display ad spending will reach $15.45 billion (69.0% of all programmatic digital ad spending), and by 2017 mobile programmatic video ad spending will reach $3.89 billion. -emarketer Programmatic digital display ad spending will reach $22.10 billion, while programmatic digital video ad spending will reach $5.51 billion. Programmatic spending on TV ads will increase to $710 million this year climbing to $4.43 billion by emarketer -emarketer

5 A wide range of technologies that automate the buying, placement and optimization of advertising, often through ad exchanges Real-time bidding is just one type of programmatic buying. It s similar to buying stocks on the stock exchange.

6 Why Programmatic? It s all about driving ROI LOEB & LOEB LLP

7 PRIMARY TYPES OF PROGRAMMATIC TRANSACTIONS PRIVATE MARKETPLACE OPEN AUCTION LOEB & LOEB LLP

8 RTB-How It Works 1. Visitor enters Publisher website URL. Publisher sends request to Ad Exchange for 1 ad of particular spec (e.g., a banner) 2. Ad Exchange makes available details of visitor, Publisher site and ad unit to participating advertisers/agencies Ad Exchange Real-Time Auction 3. Advertisers respond with different bids based on the value of that impression, and they provide the ad creative Advertiser #1: I offer $2 for this impression because the visitor abandoned a shopping cart on my site 2 hours ago Advertiser #2: I offer $1.8 for this impression because the visitor is a year old male with an interest in sports Advertiser #3: I offer $1.6 for this impression because this is an authoritative movie and gaming site 5. Visitor sees ad from highest paying advertiser. Complete process takes place while webpage loads (1-5 milliseconds) 4. Ad Exchange selects the highest paying advertiser and sends corresponding creative to Publisher website 8

9 Key Players Advertiser /Marketer Ad agencies Ad exchanges Ad networks Demand-side platforms ( DSPs ) Supply-side platforms ( SSPs ) Data brokers and data aggregators Data management platforms ( DMPs ) Publishers

10 LOEB & LOEB LLP THE TECHNOLOGY

11 Programmatic or Addressable TV Advertising Programmatic TV -the automation of audience-based TV advertising through a software platform. Addressable TV Advertising - technologies enabling advertisers to selectively segment TV audiences and serve different ads to different households within a common program.

12 Programmatic TV budgets are projected to increase from 4% to 17% by 2019 (emarketer) Programmatic TV is projected to account for $10 Billion of TV budgets by 2019 (Magna Global)

13 Traditional TV 1000 Main St Main St LOEB & LOEB LLP

14 Addressable Television 1000 Main St Main St. Female 26 years old Interest in beauty care Male 38 years old Interest in clothing LOEB & LOEB LLP

15 Addressable Television 1000 Main St Main St. Female 26 years old Interest in beauty care Male 38 years old Interest in clothing LOEB & LOEB LLP

16 Issues to Consider in Addressable TV Deals What are you paying for (e.g., premium pricing for level of targeting and limited inventory)? What are you buying or getting (e.g., audience segments)? How will the campaign results be measured? Who owns the data and analytics/outputs? How can the data and outputs be used? What data privacy and security measures are maintained? What are potential impacts of FCC privacy rules for broadband providers?

17 Addressable OOH and Billboards

18 LOEB & LOEB LLP

19 Methods of Targeting or Tracking Mobile device location Audio fingerprinting Bluetooth low-energy / beacons LOEB & LOEB LLP

20 FTC Warns 12 App Developers re: SilverPush SilverPush enables mobile devices to hear audio beacons embedded in TV programming and create a log of what users have watched March 2016: FTC sent warning letters to 12 app developers whose apps included SilverPush LOEB & LOEB LLP

21 Methods of Targeting or Tracking Device identifiers (web or mobile) Vehicles Linking purchases to digital activity LOEB & LOEB LLP

22 Cross Device / Cross Screen / Cross Platform Tracking LOEB & LOEB LLP

23 Location Technology - Tracking LOEB & LOEB LLP

24 Programmatic Advertising Deals LOEB & LOEB LLP

25 KEY ISSUES

26 Data Optimization Transparency Behavioral Ads and Targeting LOEB & LOEB LLP

27 Deals with DSPs What s At Stake LOEB & LOEB LLP

28 Legal and Contractual Issues Limits on liability Liability of DSPs and SSPs versus advertiser Data ownership and security

29 Concerns Click fraud and bot traffic Lack of transparency/fairness of algorithms Building safety valves to address excess buying Ensuring media buys meet advertiser specifications Privacy compliance Reuse of proprietary data

30 The Legal Landscape 2015 LOEB & LOEB LLP

31 U.S. Data Collection & Privacy Regime Laws and Regulations Federal FTC Act, HIPAA, GLB, FCRA, COPPA, VPPA, FCC Broadband Privacy Rules State International Self-Regulation DAA/BBB DMA (Direct Marketing Association) / Data Driven Marketing Institute IAB(Interactive Advertising Bureau) NAI(Network Advertising Industry) MMA(Mobile Marketing Association) FTC Platform Policies Third-party platforms such as DoubleClick, Facebook and Twitter App store guidelines Your own privacy policy

32 Selected Federal Laws That Regulate the Collection and Use of Consumer Data FTC Act requires companies to comply with their own privacy policies Gramm-Leach-Bliley Act (GLB) limits how consumers financial information may be used Health Insurance Portability and Accountability Act (HIPAA) limits how covered entities may use health information Children s Online Privacy Protection Act (COPPA) limits the collection of children s personal information and requires parental notice and consent New U.S. E.U. Privacy Shield Program (replaces the U.S.- E.U. Safe Harbor Framework) Places limits on data transferred between the U.S. and E.U LOEB & LOEB LLP

33 Video Privacy Protection Act (VPPA), 18 U.S.C 2710 Prohibits a video tape service provider from knowingly disclosing to third parties personally identifiable information ( PII ) concerning a consumer without his or her consent LOEB & LOEB LLP

34 FCC Broadband Privacy Rules Expanded list of what constitutes PII (device identifiers, IP addresses), which cannot be accessed or shared without customer consent (opt out) Broad definition of what constitutes CPI, including traffic statistics Web browsing, app usage precise geo-location collected through network based technologies or information available to an ISP solely because of its service relationship to customer considered sensitive and may not be used or shared without opt-in. Edge providers including the ISP when it serves as a web publisher--may collect this information through traditional tracking devices (cookies, pixels, etc.) Ambiguity about level of consent needed to use name and billing address for audience segmentation Security obligations will flow through to vendors and other third parties using ISP data LOEB & LOEB LLP

35 California Continues To Lead on Privacy Issues Dozens of privacy laws - typically provide more protection to the consumer than federal laws Law requiring disclosure of do not track compliance and a law limiting the use of recordings made by a voice-activated connected TV California laws = minimum requirements for online companies LOEB & LOEB LLP

36 Select Privacy Guidelines FTC Online Behavioral Advertising Mobile Apps Internet of Things California AG Mobile Apps Privacy Policies and Do Not Track Disclosures Digital Advertising Alliance (DAA) Online and Mobile Interest-Based Advertising Cross Device Tracking Mobile Marketing Association Text Message Marketing Alliance of Automobile Manufacturers Internet-connected cars LOEB & LOEB LLP

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38 Cross Device Tracking Issues DAAissued Application of the DAAPrinciples of Transparency and Control to Data Used Across Devices (Nov. 2015), requiring Notice that data collected from a particular browser or device may be used with another linked computer or device, or may be transferred to a non-affiliate Clear, meaningful, and prominent link to a disclosure linking to industry developed website or choice mechanism, or individually listing the Third Parties engaged in the collection Consumer choice (i.e., an opt-out mechanism) **Enforcement of DAACross-Device guidance, by the Council of BBBs and the DMA, will begin on February 1, LOEB & LOEB LLP

39 Self-Regulatory Compliance Actions Compliance Actions have focused on: Failure to provide notice on every page where data is collected or used for interest-based advertising Opt-out links that did not work Privacy policies that did not accurately describe a company s data collection and use policies Failing to honor an opt-out request for five years LOEB & LOEB LLP

40 Platforms and app stores have Terms of Use, Privacy Policies and other guidelines which may limit how you can use data. These policies change frequently LOEB & LOEB LLP

41 The European Union Data Protection Directive/GDPR One data protection law applicable to all of Europe Cookie Directive Requires obtaining consent before using cookies UK Information Commissioner s Office has issued guidelines and recently threatened to start enforcement actions Safe Harbor replaced by Privacy Shield LOEB & LOEB LLP More limited access to data

42 Enforcement Trends 2015 LOEB & LOEB LLP

43 InMobi tracked the locations consumers including children without their knowledge or consent to serve them geo-targeted advertising. Company represented that its software only tracked consumer locations when consumers opted-in or in accordance with their device s privacy settings, but actually tracked locations whether or not the application using the software asked consumer permission and even if consumers denied permission. Settled with FTC for $4 million civil penalty, suspended to $950,000 based on company s financial condition Under the terms of the settlement, InMobi must: Delete the information it collected from consumers without consent Delete all information collected from children Obtain affirmative express consent to collect consumers location information Honor consumers location privacy settings Institute comprehensive privacy program that will be independently audited every 2 years for 20 years LOEB & LOEB LLP

44 Keys to Compliance & Best Practices 2015 LOEB & LOEB LLP

45 Keys to Compliance Short Form or Layered Privacy Policy Participate in Self- Regulatory Programs Coordinate with Ad Networks & Analytics Companies Just in Time Notification (as applicable) LOEB & LOEB LLP

46 The FTC Would Like to See More Companies Adopt Privacy by Design The core idea of Privacy by Design is that companies developing new products and services should build in privacy and security protections at the very beginning of the design process. Legal needs to be involved at inception and should work with other stakeholders in this process LOEB & LOEB LLP

47 WHAT S ON THE HORIZON LOEB & LOEB LLP

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50 FTC increasingly focused on cross-device tracking, smart devices (including smart TVs), and Internet of Things LOEB & LOEB LLP