Data buyer beware: agencies are starting to ditch complacent providers

By Kate Kaye

Ad agencies are rethinking their dealings with data providers. Data privacy regulations in Europe and California, along with third-party cookie clampdowns by Apple and Google, are driving agencies to scrutinize how data suppliers source their information and handle people’s privacy choices. Some are even ending data partnerships all together.

The data privacy currents have pressed companies to clean up their data collection and retention practices, such as by providing people with notice and choice before collecting their data as well as honoring people’s requests for companies to purge their person information. Nonetheless, some data providers have yet to be budged out of complacency, according to Richard Harris, data and analytics director at independent creative and performance agency Union. So agencies are taking action.

“There’s a lot of [data] providers that we have spoken to that haven’t made the shift yet,” said Harris. “They don’t have answers to our questions when we ask if they’re enabling opt-outs or elimination of data from third-party cookies.” The result is simple, said Harris: “If they don’t have that [opt-out] ability, they won’t become a long-term partner for us,” he said.

When asked which types of data providers are at-risk, agency execs interviewed for this story were reluctant to name names. However, they suggest third-party data providers, or those concocting products from so-called data exhaust — that is the firms without direct connections to the point at which data is gathered — are skating on thin ice. That includes location-data aggregators, credit card transaction data providers and firms that build audience profiles based on third-party cookie data swirling around programmatic ad exchanges.

“If you are two to three layers away from actual ingestion of that data, the actual consent of that data, you’re going to have challenges,” said Nii Ahene, chief strategy officer at Tinuiti, which primarily handles ad buys on platforms including Google, Facebook and Amazon.

Not passing security check-points

Agencies including Goodway Group and Rapp are subjecting data providers to tougher data privacy and security inspections. Goodway already has given some suppliers the boot, said Amanda Martin, vp of enterprise partnerships. “We’re taking a far more granular look at where we’re spending and how we’re spending [on data],” she said. Already in 2021 and going forward, the agency is limiting or ending relationships with “third-party data providers that we just feel don’t meet the consent requirements or outsource so much of their data.”

Goodway is working this year to set more formal standards pertaining to data providers that entail evaluating their methodologies, determining how their data is sourced, inspecting how they garner consent from people for data use and conducting performance reviews. The agency also aims to grade data providers based on their approach to navigating the deprecation of third-party cookies and device IDs, said Martin.

Some smaller or medium-sized data brokers are not passing muster when it comes to security evaluations, said Laura Aldridge, vp and data privacy officer at Rapp. “We’re seeing it more in the data broker area …read more

Source:: Digiday