Because third party data providers can offer more data than most first party providers can, they are becoming the preferred source of data for advertisers and agencies. According to a recent eXelate survey of more than 650 digital advertising professionals, when it comes to collecting audience targeting data, most advertisers and agencies ranked third party online data as their number one source.

Third Party Data Expands Audience Targeting Budgets

In fact, third party online data was ranked the highest for both direct response and branding campaigns among advertisers and agencies. Perhaps this explains why more than 69% of respondents reported that they plan to increase their audience-targeting budgets, with an average budget increase of 38%.  While many third party data providers allow more information to be collected, most don't come cheap.


With more than 80% of advertisers and 90% of agencies growing their audience targeting campaigns, the survey found that most find audience targeting a very effective way of building custom, hyper-targeted segments that allow them to reach just the right audience.

AdTech Goes Mobile

The State of the Industry Survey was completed in conjunction with Digiday, which at the end of 2011 asked if audience buying would die in 2012. Not only is audience buying alive, it's seeping into more channels, like mobile. According to the eXelate study, an increase among advertisers using audience targeting on smartphones and tablets was reported.


While the PC remains the preferred platform, 51% of advertisers say they use the smartphone, compared with 62% of agencies and 60% of networks, exchanges and demand-side platforms (DSP).

Third Party Challenges

Despite their popularity, however, there are challenges associated with relying on third party data sources. Most importantly, not all vendors secure consumer data correctly. According to an Experian Data Breach Resolution commissioned survey conducted by the Ponemon Institute, the most common mistakes outlined included:

  • Failing to hold vendors to the same security standards as they do for their own in-house security practices;
  • Not knowing how frequently the vendor is losing their consumer data;
  • Not taking action following a breach, such as requiring the vendor to fix any known problem causing the data breach; and
  • Not requiring the vendor to conduct an audit and detailed assessment to understand the source and cause of the incident.

Additionally, the study estimated that in the past 24 months, 65% of participants admitted their organization had a breach involving the loss or theft of their organization’s information when it was outsourced to a third party, with some 64% reporting it happening more than once.

Third party data providers can be helpful in expanding audience-finding techniques, but should not come at the expense of limiting governance and oversight.