The Future of Digital Marketing: Will IP Address Based Marketing Survive?
An IP (Internet Protocol) address is one, if not the most important piece of information for any device connected to the internet or network. Without it, connecting to the internet is virtually impossible because every network and online service will require a unique identifier to any device for it to effectively provide the needed service.
This single piece of information comes with a boatload of benefits for connected devices and online services at the same time. Using the IP address, a connected device is assured of its uniqueness that enables tailored services based on location and prior log-ins. Online services could also filter online activities to their websites by blocking visitors based on their IP address.
Aside from online services and devices, an IP address is also a very important piece of information to online marketers - and not just small online companies. Corporations are taking full advantage of IP addresses in order to target and tailor specific ads.
Businesses large and small are using IP addresses for marketing and it has worked on them for some time. However, the rise of privacy concerns has created concerns on some marketers with regards to their marketing practice. There might be solutions but it could be an uphill battle.
IP Address as Personal Data
The biggest challenge to advertisers using IP addresses for marketing is the classification of an IP address as personal data. This means, gathering this type of information without consent will be considered illegal. According to IAPP.org, the EU General Data Protection Regulation has specifically stated that both types of IP addresses (dynamic or static) IS personal data. Since this is a blanket decision, marketers cannot use IP addresses in any country under the European Union.
In the US, the decision to mark IP addresses as personal data is left to individual States. 11 states have already enacted laws related to this type of privacy and it's not a far-fetched idea that more states will move towards this type of protection. There may be some argument on the proper scope of the implementation, it is still a move towards privacy.
Google has also taken proactive steps in protecting IP addresses from advertisers as they no longer store IP addresses on their Google Analytics 4.
There is an argument in terms of technicality for tagging IP addresses as personal data. Among them is the fact that an IP address could actually change anytime a connection is renewed. Any user with familiarity with computer settings could easily make some changes on their IP address.
However, the counter argument on pushing for IP addresses as personal data is the fact that IP addresses can be used to track an individual activity.
Marketers Workaround as the Future
Aside from specified locations and services, IP addresses can still be used for marketing purposes. By default, a user's IP address is readily available when using an online service. But this doesn't mean the future still holds bright for those who still use IP addresses as a means of marketing strategy.
However, targeting marketing online will not die and never will - it's just a matter of finding a workaround within the legal beneficiaries. Companies can still use IP addresses for marketing but there are online advertisers that use "aggregate data" or "anonymized geolocation" for specified, targeted ads. This type of information does not come with specific information about a single user but they do provide information useful for marketers.
The future of online marketing using IP addresses for targeted ads is facing some challenges. It may not end soon but it's time for online marketers to look for alternatives.
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