Understanding
Online Advertising
What Is It?
Digital Advertising is a broad term used to describe the paid advertising that publishers put on their websites, apps, or televisions to enable them to provide you content and services for free. But what most people hear about is a specific type of online advertising that is tailored to your likely interests by companies promoting their products or services. This is known as Interest-Based Advertising (IBA), when it occurs across websites, and Cross-App Advertising (CAA), when it occurs across apps, and Viewed Content Advertising (VCA) when it occurs on smart TVs and TV streaming devices.
Tailored Advertising is why you see ads that are relevant to you. With this type of advertising, NAI member companies and advertisers collect information across some of the sites you visit and apps that you use. They then use this information to try to predict what ads might be the most interesting to you.
Essentially, the free websites and apps you enjoy may be used to help serve ads that you would find more meaningful, informative, and interesting, than would the person sitting next to you. Reading an article about travel? You’ll probably see ads for travel shortly after. Check out a musician’s website? You might get some ads for music popping up soon too.
Tailored Advertising doesn’t depend on information that may be personally identified to you, such as your name, phone number, Social Security number, etc. In fact, most third-party companies don’t want to know who you are for Tailored Advertising. They only want to link interest categories (loves travel) or demographic data (male under 30) with your browser so that they can serve up relevant ads. Of course, different companies use different methods of Tailored Advertising.
Similarly, advertisers generally don’t want to know your mobile device's permanent identifier to serve you relevant ads. Most modern mobile operating systems contain Mobile Advertising Identifiers, or more temporary identifiers, that have built-in privacy controls. For example, the advertising IDs on Android, Windows, and iOS devices have options to opt-out of interest-based advertising or cross-app advertising and they have an option for you to change your advertising identifier. Advertisers are contractually required to use these privacy-friendly Mobile Advertising Identifiers, instead of your actual device identifier. This means you have control over whether ads are relevant to you.
Mobile browsers currently don’t use the Mobile Advertising Identifiers and instead, use standard browser identifiers (often, cookies). This means your choices apply to each browser and mobile identifier separately.
| How does it work? |
With Tailored Advertising, NAI member companies help advertisers show relevant ads -- matching these ads with broad interest categories or groups like "male clothing shoppers 25-34" or "car buyers in Illinois." NAI members distinguish between visitors to a site and users of an app, assigning them to broad interest category groups using information such as the types of websites visited or the demographics of people who use a certain app. For NAI members, Tailored Advertising is not about you as an identified individual. Instead, NAI member companies make educated guesses about the preferences and interests of consumers like you. MORE › |