Criteo CEO JB Rudelle responds to the recent controversy - outlined in Ad Age and The New York Times - regarding the use of the popular online advertising tactic known as "retargeting" and its impact on consumer privacy.
AdExchanger.com: There is a fairly active conversation happening in the marketplace with respect to targeting and consumer privacy and some recent campaigns. Should consumers be concerned?
JBR: There is a very important element of consumer education and dispelling myths that come with any new technology that involves personalization. As a leader in this industry, we understand that consumers can be a little uneasy about the concept of retargeting and privacy because, until now, there has been little information about how personalized retargeting works and much confusion with other types of data-driven marketing tactics.
Criteo solves a need created by two very important trends in the media and advertising industry: less than 20% of people are willing to pay for their favorite news and information site online, according to the Pew Research Center’s Project for Excellence in Journalism 2010 “State of the Media” report. Meanwhile, according the same report, 79 percent of online news and information consumers had never or only rarely clicked an online ad.
This creates a situation where consumers want services to be free, but the current advertising models are broken, forcing the industry to rethink how it engages with customers and do so in a way that can generate meaningful returns to advertisers who support free content and services. To solve this predicament, retargeting – and Criteo in particular – has found a way to leverage consumer intentions to create ultra-relevant advertising.
Thus, the onus is on us, as responsible vendors, to readily provide information to these consumers about how it works and that privacy is actually a strength of personalized retargeting given that does not use any personally identifiable information (PII) and is supported by transparency and a clear opt out route. Today, retargeting has become mainstream amongst advertiser; however we realize the need for some consumers need to be educated about how it works and that they’re in control and that’s been reflected in the feedback we’re seeing.
What’s the tone amongst your advertisers about retargeting and privacy?
One of the primary components to our rapid and continual growth is the fact that our retail partners are thrilled with the technology and the results they are seeing. When privacy-related feedback in the marketplace arises, our advertisers first and foremost want to make sure that their customers understand what’s happening and are very responsive to concerns. We also work closely with our clients to make sure everything we do supports their relationships with customers.
Our business is about building trust with consumers and building a deeper relationship between the consumer and a brand. To do this, we must be completely transparent and provide consumers with the information on why and how they are being served an ad, giving them the control to opt out of being shown personalized ads from Criteo, and only showing relevant ads that enhance a browsing experience.
It only makes sense for our retail clients to continue their relationship with Criteo – they pay only for an ad when the shopper clicks on it (a CPC model), thus bringing them back to the retailer’s site. We are proud to share that Criteo has generated more than $2 billion in post-click sales generated by consumers who have actively engaged with retargeted ads and proceeded to purchase. This number is incredible because it was only in June that we announced reaching $1 billion in post-click sales and demonstrates the wide acceptance, and even preference, for this type of relevant advertising.
Why is retargeting a good thing for the consumer?
We believe that retargeting is good for consumers because it provides consumers the most relevant online advertising experience. The overwhelming response from consumers has been positive. The benefit is clear for consumers: they are served ad which are relevant to their exact purchase history and avoid being exposed to hundreds of ads each day, which contain no individual relevance.
Retargeting is good for consumers, when compared to other types of advertising, as it doesn’t rely on personally identifiable information (PII). We don’t track personally identifiable information, no data is shared with advertisers or publishers and no third-party data used for targeting purposes. Retargeting only uses anonymous information from a the merchant’s site and yet can still deliver the most targeted and effective ads on the planet.
It’s good because consumers are in control. If consumers don't want to receive retargeted ads, they can opt out of ads from a specific merchant, or from retargeted ads through Criteo in just a few clients. Each ad served by Criteo provides an easy opt out route which is an industry first.
Also, Criteo’s technology not only displays ads that are so personalized as to show the exact products the online shopper clicked on, but the ads also recommend additional products the consumer might be interested in purchasing based on what other shoppers had purchased in the past with he “clicked” on product. For all the reasons above, not only have our retail partners benefited from Criteo, but also consumer satisfaction can be seen through the amount in which they click and buy, which is equating to greater numbers at faster rates than any other company in our space.
Any plans on how you may change the personalized retargeting core to Criteo's offering given recent events?
We are on an amazing trajectory. We’ve had a tremendously successful entrance into the U.S. market and continue to see huge influx of advertisers and consumer clicks across all 12 of our offices internationally. And although clicks are great – conversions are even more meaningful. We also recently surpassed more than $2 billion in post-click sales for our advertisers, which is astounding.
With that said, we’re listening and engaging in the conversation that’s happening about retargeting and are grateful that sites like AdExchanger are taking a closer look at the space and how it’s evolving. We have the largest R&D team in this space and are constantly incorporating client and consumer feedback to improve both the product and consumer experience with Criteo ads.
We’re one of the most open, accessible and transparent companies out there when it comes to retargeting and how our technology works. We have a number of important technology innovations in the pipeline and look forward to sharing them with AdExchanger’s readers when we make them public.
What is Criteo's view on protecting consumer privacy?
As mentioned, we have some of the most strict privacy policies in the entire industry – operating in 12 worldwide locations, including some of the most privacy-conscious countries, including Germany. We place a major emphasis on transparency around how our technology operates and empowers consumers to control their engagement with retargeted advertising. The overwhelming percent of online shoppers not only identify this, but also save their own time and resources because they enjoy using the personalized ads.
I go back to the three things we fundamentally believe every consumer should understand, almost a “consumer advertising bill of rights” if you will with regards to online advertising in general and retargeting in particular: 1) why am I receiving this ad, 2) what kind of information was used to tailor the ad to me, and 3) how can I stop receiving ads and others like it? All of this information is provided to consumers by just clicking on the “i” in every banner we serve. We are the first company in the industry to proactively make this information available to consumers and we've received great feedback from consumers and industry experts about our practices.
We believe the industry should move to a place where consumers understand why they are receiving every ad, including methods where there no PII is used in the ad-delivery process, and where consumers are empowered with the opportunity to control their exposure to advertising.
Further, we believe that once consumers truly understand retargeting, they vast majority will see retargeting as one of the most transparent, ethical and valuable ad delivery methods in the industry.
By John Ebbert