A digital watermarking system uses a model of a rendering device to take into account the impact of the rendering device on visual or auditory quality of the watermarked signal. For visual content, a reference image and watermarked image are passed through the model and then supplied to a visual quality metric that assesses the visibility of the watermark. The digital watermark embedding is adjusted iteratively with each pass through this process to produce a watermarked signal that has the desired visual quality.