For about five years, from the implementation of GDPR in 2018 until 2023, the primary discussion in advertising centred on privacy and the signal loss privacy regulations and platform changes would create. Privacy loomed as both an ethical imperative and a regulatory challenge for advertisers and publishers that wanted to accurately target and measure advertising.

The excitement around AI following ChatGPT’s explosive growth, plus Google’s ultimate decision to kick cookie deprecation back to consumers, shifted the industry’s focus. Signal loss is no longer top of mind. Instead, new startups are largely focused on future innovations driven by AI, and instead of rewriting their sites to say “privacy-safe,” every adtech company is scrambling to articulate how they’re leveraging AI on behalf of advertisers and publishers.

There’s a third trend that has emerged amid the handoff from privacy to AI: media quality. Facing fraud, made-for-advertising sites, climate change, and even illegal content, advertisers, publishers, and adtech companies are asking how they can better factor media quality into media buying to drive better outcomes and create a healthier information ecosystem.

These three trends — signal loss, AI, and media quality — are actually related, and the future of advertising lies at their intersection.

Signal loss is the foundation of advertising challenges

Signal loss has sometimes been interpreted as meaning just the loss of signal due to privacy changes such as GDPR, cookie deprecation, or mobile ID deprecation. But it’s actually a challenge that sits at the heart of programmatic.

Publishers have near-perfect signals as to the nature of their content and who’s engaging with it. Media buyers want to reach those audiences and target them based on that content. The distortion of that information from publisher (where it is high-quality) to the moment of decisioning (where it is often low-quality) is signal loss, and it drives the persistence of fraud, MFAs, and outsized carbon emissions as well as poor marketing outcomes.

In other words, the pursuit of better outcomes and the pursuit of a higher-quality, more sustainable information ecosystem are aligned — and they both start with solving signal loss. The problem is that has historically been impossible, except as a matter of incremental progress.

AI changes the game.

AI will solve signal loss, improving quality and outcomes

Programmatic has historically suffered from a scale and complexity problem. If a publisher is communicating directly with an advertiser, it’s easy to retain the quality of their signals, thereby facilitating accurate ad targeting on high-quality media properties. But programmatic facilitates ad buying at scale. Therein emerges complexity. And complexity has led to the near-impossibility of communicating signals from publisher to media buyer accurately (at that scale).

AI far surpasses humans’ ability to handle complexity at scale. So, AI could solve advertising’s signal loss problem by improving the communication of information from publishers to advertisers.

Imagine every publisher and advertiser leveraged powerful AIs (like the AI agents gaining popularity) that talk to each other. Every publisher would have an AI that knows everything about its inventory and audiences. Every buyer would have AI that knows everything about its own audience, creative guidelines, and business objectives. These AIs could communicate a great deal of complex information about each party with little to no signal loss.

The result would boost media quality as the AI can be custom programmed to reject fraud, MFAs, brand-unsafe content, high-emitting content, and whatever other types of inventory sources conflicted with the human-determined parameters each brand establishes for themselves. We’re closer than ever to realizing this future.

AI in programmatic advertising ushers in a new paradigm and, with it, fresh possibilities to solve signal loss and the problems (such as a low-quality information ecosystem and suboptimal outcomes) that it causes.

The baton has not been passed from the problem of signal loss to the opportunity of AI. Rather, AI is the technological breakthrough that will solve signal loss, thereby creating a healthier information ecosystem, driving better outcomes and more effective media for marketers, and fixing the quality issues that have long seemed intractable in programmatic.

The era of AI advertising is here. A higher-quality media ecosystem — and better outcomes for marketers — will arrive with it.

Photo by Joe Yates on Unsplash