Consent-or-pay: Difference between revisions
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'''Consent-or-pay''', also known as '''consent-or-okay''', is a business model implemented in response to the European Union's ''[[General Data Protection Regulation]]'' [[General Data Protection Regulation|(GDPR)]]. Under this model, users of a website are presented with a choice to either: | '''Consent-or-pay''', also known as '''consent-or-okay''', is a business model implemented in response to the European Union's ''[[General Data Protection Regulation]]'' [[General Data Protection Regulation|(GDPR)]]. Under this model, users of a website are presented with a choice to either: | ||
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The General Data Protection Regulation was enacted in 2018 with the objective of protecting online users from extensive data collection by companies. The regulation requires companies to obtain user consent for data collection, which is typically facilitated through an opt-in banner or pop-up on a website. | The General Data Protection Regulation was enacted in 2018 with the objective of protecting online users from extensive data collection by companies. The regulation requires companies to obtain user consent for data collection, which is typically facilitated through an opt-in banner or pop-up on a website. | ||
Some companies reported a negative impact on revenue following the regulation's implementation{{ | Some companies reported a negative impact on revenue following the regulation's implementation<ref name=":2">{{Cite web |last=Mititelu |first=Andra |date=2023 |title=As the Open Marketplace Fails, Advertisers Are Turning to Publishers to Reach Audiences |url=https://advertisingweek.com/as-the-open-marketplace-fails-advertisers-are-turning-to-publishers-to-reach-audiences/ |url-status=live |archive-url=https://web.archive.org/web/20230927212627/https://advertisingweek.com/as-the-open-marketplace-fails-advertisers-are-turning-to-publishers-to-reach-audiences/ |archive-date=27 Sep 2023 |access-date=1 Sep 2025 |website=Advertising Week}}</ref>, as the scale of data collection for targeted advertising was reduced. The consent-or-pay model emerged as an approach to address this change. | ||
==How it works== | ==How it works== | ||
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==Effectiveness== | ==Effectiveness== | ||
The | ''The Open Marketplace'', once considered the easiest and most efficient platform for advertisers and publishers to transact, has been facing steady decline since the General Data Protection went into effect<ref name=":2" />. In a report by Advertising Week published in September 2023, advertisers using Open Marketplace were reaching only roughly 30% of their audience, meaning that 70% of advertising efforts were wasted due to users opting out of data collection<ref name=":2" />. Their findings were based upon a report from ''Nano Interactive,'' a company that claims to be "at the forefront of privacy-first, identity-free online advertising"<ref>{{Cite web |title=Who We Are |url=https://www.nanointeractive.com/company/ |website=Nano Interactive}}</ref>, in which the company surveyed 2,000 UK consumers and found that 70% of them rejected cookies using various methods (VPN, incognito mode, clearing cache, etc)<ref name=":3">{{Cite web |title=UK Cookie-Blocking Research |url=https://www.nanointeractive.com/tipping-point-research/ |website=Nano Interactive}}</ref><ref name=":4">{{Cite web |last=O'Connell |first=Vanessa |date=9 May 2023 |title=70% of consumers blocking cookies online, research shows |url=https://www.thedrum.com/opinion/2023/05/09/70-consumers-blocking-cookies-online-research-shows |url-status=live |archive-url=https://web.archive.org/web/20230511090722/https://www.thedrum.com/opinion/2023/05/09/70-consumers-blocking-cookies-online-research-shows |archive-date=11 May 2023 |access-date=1 Sep 2025 |website=The Drum}}</ref>. | ||
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''The Drum'' reported on that same survey by noting the increasing discomfort consumers have on trading personal data for free content<ref name=":4" />. Those in the survey were split 30-30% on whether they view this as a fair exchange, but over half believe advertisers should find better ways to make ads relevant. Additionally, it was reported that of consumers who are concerned about privacy, 42% report data collection as their biggest concern, while only 31% are concerned with data breaches or online scams respectively<ref name=":3" /><ref name=":4" />. | |||
==Alternative practices== | ==Alternative practices== | ||
'''Contextual advertising''' is a model that serves ads based on the content of the page a user is viewing (e.g., food ingredients on a recipe page). This advertising model had once been considered the standard on the internet and has returned in high numbers since the General Data Protection Regulation went into effect<ref name=":5">{{Cite web |last=Davies |first=Jessica |date=7 Jun 2018 |title=‘Personalization diminished’: In the GDPR era, contextual targeting is making a comeback |url=https://digiday.com/media/personalization-diminished-gdpr-era-contextual-targeting-making-comeback/ |website=Digiday}}</ref><ref name=":6">{{Cite web |last=Maher |first=Bron |date=21 Nov 2023 |title=Guardian gets around readers who reject cookies with new advertising product |url=https://pressgazette.co.uk/marketing/guardian-light-reject-cookies-advertising-stereotype/ |url-access=limited |url-status=live |archive-url=https://web.archive.org/web/20231128184011/https://pressgazette.co.uk/marketing/guardian-light-reject-cookies-advertising-stereotype/ |archive-date=28 Nov 2023 |access-date=1 Sep 2025 |website=Press Gazette}}<nowiki>}}</nowiki></ref>. ''The Guardian'', a UK-based news organization, reported a 35% increase in ad clicks after emplying this model, describing it as "a perfect advertising product for a privacy conscious brand"<ref name=":6" />. An article from ''Digiday'' reports that some publishers had long complained at the loss of contextual advertising in the rush to micro-target through personalized ads<ref name=":5" />. They state the the infamous ''ad-pocalypse'' from YouTube could have been avoided if advertisers stuck with contextual advertising instead of following users around the internet<ref name=":6" />. | |||
==See also== | ==See also== | ||
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[https://noyb.eu/en/noybs-pay-or-okay-report-how-companies-make-you-pay-privacy noyb's Pay or Okay report: how companies make you pay for privacy] | [https://noyb.eu/en/noybs-pay-or-okay-report-how-companies-make-you-pay-privacy noyb's Pay or Okay report: how companies make you pay for privacy] | ||
[https://digiday.com/media/personalization-diminished-gdpr-era-contextual-targeting-making-comeback/ ‘Personalization diminished’: In the GDPR era, contextual targeting is making a comeback] | |||
==References== | ==References== | ||