Amidst growing concerns about the privacy and efficacy of
cookie tracking, Pandora is offering advertisers ad targeting options based on
proprietary audience segments rather than cookie-based data collected by third
parties. Pandora is first rolling out two
target audience segments – Hispanic listeners and a subset of Spanish-speaking
listeners. To create these two
categories, Pandora cross-referenced its registered user data with U.S. census
data to identify zip codes with high populations of their two target segments
and overlaid the two data sets to infer which listener belonged in which
bucket.
Pandora’s aims to enable advertisers to better target ads on
the streaming music service. Prior to
this rollout, cookies were used mostly for display ads and did not work for ad
targeting on Pandora’s mobile apps, where the bulk of Pandora’s advertising
revenue is generated. It is estimated
that Pandora’s proprietary Hispanic and Spanish-speaking listener segments are
at least 10% more accurate than those created based on third-party data.
This is yet another example of the growing trend of
leveraging registration and log-in data to do better ad targeting and hopefully
mitigate privacy concerns. However,
Pandora should tread lightly as it considers eventually applying its user data
to ad targeting on other sites and apps.
With most users still ignoring the fine print when registering for an
account, the last thing Pandora wants to do is violate their users’ implicit trust
by selling their data so that advertisers can target them elsewhere on the
Internet.
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