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What is data leakage?‎

In the world of online advertising, data leakage refers to the capture of user data by a third ‎party via a publisher’s website; often without the publisher’s knowledge or permission.‎

Advertisers, ad networks and data companies are able to place cookies on a user’s computer ‎through ad servers or ad tags running on a publisher’s website. This is not a new concept ‎having been common practice for several years, with the data being used for reasons such ‎as measuring ROI. However, the regular practice of ‘cookie dropping’ combined with ‎advancing internet technology and the development of real-time bidding exchanges, has ‎made this data extremely valuable for advertising purposes.‎

How is data used?‎

Cookies provide an abundance of information about a user and their browsing habits, and ‎data companies are able to build a unique profile for each cookie before separating them ‎into groups based on a variety of criteria. In this way an advertiser can build up a ‘cookie ‎pool’ which they wish to target with a marketing campaign. This type of audience targeting ‎is crucial in online advertising, enabling advertisers to get their message in front of exactly ‎the right people in the most cost-effective way. ‎

It is the ability to track a cookie pool and market to it across the internet which has caused a ‎conflict between advertisers and publishers. A premium website will consistently produce ‎high quality content over a long period of time to grow and retain a large audience, and ‎publishers are able to charge premium rates for advertising on the strength of the size of ‎their readership. With the use of cookies, advertisers can build a cookie pool of the ‎publisher’s audience then market to it through other cheaper sites and ad networks, thus ‎reducing the value of the publisher’s initial advertising space. ‎

Controlling data leakage

Many publishers are looking to technology which will prevent data leakage, giving them ‎control over advertising to their audience and retaining their place in the value chain. Some ‎are also taking the opportunity to offer an audience extension product, and actively selling ‎their audience on ad exchanges. ‎

The reward for investing in technology and quality editorial on a website to build a large ‎and engaged audience has always been premium prices for advertising; publishers are keen ‎for this situation to remain. The audience of a market-leading website carries this premium ‎as they can only be targeted through that site. If the audience becomes a simple data pool ‎they can be targeted anywhere on the web, making the value of the audience virtually ‎worthless. ‎

With vastly reduced costs in mind, advertisers are keen to explore and utilise data gleaned ‎from third party cookies, while publishers remain intent on protecting the ‘asset’ of their ‎readership.‎