Impact to advertising revenue with Do Not Track.
While Do Not Track sounds like a great idea by many who do not like the idea of being tracked, there is an impact. And that impact is advertising on small web sites which rely on advertising revenue. And in reality, it is even large web sites which base a large portion of their revenue on advertising who will be hurt as well. The way that advertising displayed on the web works today is by tracking the kind of things that you are doing on the web and displaying advertisements that relate to what you are looking at. Those targeted ads are more likely to result in someone clicking on them to look further at the advertised item.
Do Not Track will allow for individuals to inform web sites to not track and collect their activities. While most would hope this would be a passive decision, Microsoft has decided to make it the default value in Internet Explorer 10. Yes, it will be turned on automatically to not track people's activities on the web. While there is no enforcement mechanism in place at the moment, it means a big impact to advertisers when everyone agrees to not be tracking those who have opted to not be tracked. Do Not Track could create some big problems for advertising dollars.
This all sounds good and for those who like privacy and do not want anyone knowing where they are on the web or what they are doing, this is great. But for those who rely on advertising revenue, this may turn into a nightmare for those businesses. And it is many businesses which are going to be impacted if large numbers of people are not tracked to display targeted advertising. That is because advertisers provide higher Pay Per Click (PPC) values for some of those targeted ads.
If advertisers are not able to target advertising, the incentive to pay higher PPC values to the people who are displaying the ads on the web pages will more than likely decline. Advertisers want to get traffic and without targeted advertising, they are definitely not going to be paying the same level of money which they currently are. That is just common business sense.
We have already seen the impact to web sites when traffic is diminished when Google changes their algorithm and a site takes a big hit. With reduced traffic there is reduced clicks on ads and thereby reduced revenue. It is the clicking on ads which provides ad revenue. So, if the traffic to a site stays the same, but the value of each advertising click is diminished, there is an impact.
The amount of that is unknown. Advertisers could pay one rate for targeted ads for those people who have not clicked on Do Not Track and another rate for those who have clicked on Do Not Track. With Microsoft making the value to be as though the person had clicked on Do Not Track, there will be a large audience not being tracked.
The impact of the non-targeted ads on revenue is not known, but lets assume it is a 25% discount. That is a huge amount to lose because of Do Not Track. The values could be larger or smaller, we just do not know what it will be. But we do know that it will be impacted once this is fully implemented.
Are you concerned about the impact to your advertising revenue because of Do Not Track?
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