Summary of Articles
Despite the importance of consumer profiles for advertisers, surprisingly little is known regarding their breadth, depth, density, and consistency. The article „Velocity, Density, and Consistency of Third-Party Consumer Profiling“ provides those insights based on a random sample of nearly 54,000 consumers tracked by a major European ad exchange.
While consumer data are essential for modern data-driven advertising strategies, their collection and usage raise privacy concerns. Therefore, some firms adopted a concept called „differential privacy“ to reduce data accuracy, increasing consumer privacy. The article „Price of Privacy for Online Advertising“ provides the economic consequences of differential privacy based on almost 8,000,000 bids from 535 advertisers.
Regulators all over the world introduce new privacy laws to decrease the amount of personal data processed by firms. Yet, some firms are not compliant, and some data processing might simply be too valuable to restrict it. The article „Does Even a Small Data Tax Increase Consumer Privacy“ proposes a data tax to incentivize firms not to provide or use personal data for targeting. It simulates the impact of a tax on consumer privacy and the decrease in the value of targeting.
While the new privacy laws emerge, their impact on the different actors in the online advertising market remains unclear. The article „The Impact of the General Data Protection Regulation (GDPR) on the Online Advertising Industry“ (i) outlines how the online advertising industry operates. It uses the European General Data Protection Regulation (GDPR) as the first of a handful of one rather strict privacy laws to illustrate the (ii) economic impact of GDPR and (iii) how to process personal data for online advertising legally and technically. The manuscript also (iv) provides empirical insights into the complexity of the industry and the decision cost of the users.