The 13% Problem: Why Identity Accuracy Is Advertising’s Blind Spot
The advertising industry has spent the past decade building smarter tools for targeting and measurement. Today, marketers can buy media programmatically, layer in sophisticated audience data, and track performance in ways that weren’t possible just a few years ago. On the surface, it looks like advertisers should have more clarity than ever about who they’re reaching, but that clarity still depends on something foundational: the accuracy of the identity signals acting as the bedrock of their campaigns.
Brands are paying a premium for better data and technology, and expect those investments to translate into better outcomes. The problem is that even the most advanced data is only useful if it can be reliably connected to real people. When those signals are constantly shifting, it introduces doubt into both targeting and measurement.
Knowing that identity signals can be anything from a name, phone number, email address, postal address or any combination of these, ensuring those signals are consistent and persistent is critical. When they’re constantly changing, you lose the foundation that everything else depends on. To be specific, recent reporting from an independent third party found that using an IP address as the signal to target in a household-based environment like CTV is only 13–16% accurate. In other words, for every $1 of media investment aimed at a specific audience, about 85 cents is wasted right out of the gate… so is it really worth the premium?
Contending with a fragmented media ecosystem
Part of the challenge comes from how fragmented the media ecosystem has become. Campaigns now run across streaming services, mobile devices, digital environments, and traditional television, each relying on different approaches to identifying audiences. These approaches rarely agree, meaning advertisers may believe they’re targeting the same audience while actually reaching different ones.
For marketers running cross-platform campaigns, that fragmentation creates real complications. A brand might build an audience and deploy it across several inventory sources, expecting consistency. In reality, those campaigns may reach entirely different audiences depending on the identity framework each platform is using.
That’s why the industry is taking a closer look at what makes an identity signal dependable. The most reliable signals tend to be deterministic and authenticated, tied directly to real individuals or households through a stable relationship First-party, privacy-safe, consent-based data connected to verified accounts provides a stronger foundation than signals that are inferred or frequently refreshed.
In television environments, identity is inherently household-based. A postal address is far less likely to change than digital identifiers, creating a consistent way to understand who lives in a household and connect audience insights, ad exposure, and outcomes in a meaningful way. Signals that change frequently, such as IP addresses, make that much harder. Because they can refresh or represent multiple devices and people, they don’t reliably connect datasets. Over time, that instability creates a gap between the audience an advertiser planned to reach and the one they actually reached, impacting both targeting and measurement.
Improving identity stability
As the industry evolves, improving identity reliability will require greater collaboration across agencies, publishers, and especially data providers. The reliability of identity signals should be considered in the campaign planning phase, and cost efficiency evaluated as a function of signal quality. Some CTV environments may look cost effective, but that perception breaks down quickly when identity isn’t reliable. If the underlying signal is only 13–16% accurate, advertisers are effectively paying a premium to reach the wrong audience. The goal isn’t just cost efficiency, but ensuring the signals connecting data to real audiences are dependable.
By increasing investment in targeted TV environments that rely on more stable identifiers like postal addresses, advertisers can reduce wasted spend and improve overall campaign efficiency. In a complex media landscape, that reliability gives advertisers something more valuable: confidence that their campaigns are actually reaching and measuring the audiences they intended.
[Editor's note: This is a contributed article from Ampersand. Streaming Media accepts vendor bylines based solely on their value to our readers.]