A post cookie world

16th July 2020
Posted in Projects
16th July 2020 Jade Harley

A post cookie world

Google’s decision to end the support of third-party cookies on Chrome by 2022 has caused panic and confusion for brands and marketers.

The shift to programmatic buying (including social) over the past 5 years has been the real driving force behind the flow of funds moving away from “trusted” sources, as advertisers sought to target their audience as efficiently as possible regardless of the environment.

“The pending death of the cookie means that this reliance on 3rd party cookies (the driver behind most audience buys), will require all advertisers to adjust accordingly.” – Kaimera CDO Trent McMillan states. “We’re expecting to see an increase in 1st and 2nd party data agreements, coupled with a heavier reliance on environment for contextual alignment.”

There is still a lot of speculation in the industry, as we collectively wait to see what the big players (in particular, Google and Facebook) will be rolling out to counter these changes.

We asked some industry experts – What’s next for Advertisers, Ad Tech and Publishers in a Cookie-less world? In the following article you can read expert opinions and insights from MiQ, Quantcast, Verizon Media and Nine.

We asked our CDO, Trent McMillan to summarise the core themes our trusted partners have expanded on below, and for his opinion on how this will impact the industry and advertisers.

“Although there is a lot of buzz within the industry, and there is plenty being done behind closed doors (Chrome’s ‘Sandbox’) there is still a lot of uncertainty, and at this stage, no silver bullet solution. What is clear, and widely agreed by all, is that we’re headed for some big changes, with three key themes consistently appearing:

1st party data will be paramount. Whether you’re a publisher, tech provider or advertiser ensuring that you have the appropriate collection, management and implementation of your own data will strongly influence your success across digital.

3rd party cookies are on the out. Those relying on these, to either segment and target their audience, or as a key revenue stream, will be the ones hardest hit. With this currency being removed from the ecosystem data partnerships will see a rise.

A contextual renaissance. Either, to support data partnerships or as an alternative, ensuring advertising is placed within relevant environments will see a return to favour, at least in the short term, whilst we all find our feet.

In summary, this is not a new phenomenon or challenge. We have already seen the impacts of cookie “blind spots” ever increasing over the year, whether it be due to device capabilities and fragmentation or browser/user blocking. With this being the case, we’re already operating in an inefficient ecosystem, so I’m rather excited by this change and leaning towards this being a positive step to a more reliable solution that provides a better experience for everyone involved.”

What does the death of the cookie mean for Publishers and the industry?

Dan Richardson – Head of Data at Verizon Media

At Verizon Media we understand first-party data is key in moving forward in an ecosystem where third-party cookies are restricted, and with that our preparations fall into two clear camps.

The first is growing our member base of logged-in daily active users. Since becoming Verizon Media in 2019 we’ve invested significantly in providing premium, helpful and unique content to our consumers, with new video interview series including Yahoo Finance’s The New Investors and our entertainment chat show BUILD by Yahoo, whilst adding a bigger value element with the launch of Yahoo Mail 6 which dials up the utilities around e-commerce, coupons and deals. In Australia we’re seeing on average 100,000 new members a month as a result.

The second focus is on evolving our Verizon Ad Platforms to receive and build audiences from deterministic datasets such as customer email lists, and mobile advertiser IDs as well. Brands can log into their private account, do the match and start activating. This extends to data management platform integrations too. In terms of infrastructure we are also upgrading our Demand and Supply Side Platforms to ensure an encrypted user ID (cookie-less) can be recognised and activated. This will be crucial for marketers to target and measure effectively, and for publishers to reach an authenticated audience whilst maintain eCPM’s and impression fill rates.

Hannah Cooper – Group Head, NSW Agency Sales at Quantcast

As an identity solution, the third-party cookie has always been half-baked. When Google made the announcement that their popular Chrome browser will stop supporting third-party cookies in 2022, it wasn’t expected. They have acted responsibly in providing time for a trillion-dollar industry to prepare effectively.

The move away from cookies represents a continuing shift towards consumer transparency and control. New identity solutions paired with tried and tested technologies like probabilistic audience modelling and contextual relevance will form the building blocks of tomorrow’s online experience.

However, changes in the cookie landscape are nothing new. The landscape has evolved consistently over the past 10 years as new technology and channels have become more prevalent. As the landscape has changed, companies have kept pace by adjusting their practices for providing tailored advertising services. However, it is typically industry-wide adaptations that gain the most traction.

Anthony Mogensen – Head of Digital, Sydney at Nine

In January this year, Google announced that Chrome would cease supporting 3rd party cookies within 2 years. This announcement, along with previous announcements by Safari and Firefox, mean that third party cookies will be obsolete on 87% of browsers within 2 years. In addition to the browser changes, increased regulation around user privacy is expected to be introduced, forcing higher standards around data governance and compliance.

These browser changes (or the death of the 3rd party cookie) will have a significant impact on marketers. Most of the data they might currently use to target, manage frequency and measure digital campaigns across the open web today is expected to become obsolete and it will be harder to capture any form of online identifier that could be linked to a person in the absence of a signed in registration. These changes will introduce challenges but also opportunities for how marketers build their brands online and ultimately grow their sales. We believe it will create two major market trends:

  1. Companies that don’t have a consented identity data asset (created by user log ins where they hold an email address and a unique and persistent identifier) at scale will find it harder to target audiences and measure campaign attribution. Publishers who aren’t reliant on 3rd party cookie data will become a valuable source of data to help marketers achieve targeting and measurement at scale.
  2. In a cookie-less world where there’s much less data, content (and context) will become king again!

Vishal Shah – Solutions Lead, ANZ at MiQ

The fundamentals of the advertising industry including targeting, segmentation, activation, reporting and measurement are all affected with this pending change. Standardised ways of doing these functions have to adapt in a cookie-less world.

1st party data is the game in a post cookie-less world. You have a legitimate relationship with consumers surfing your site and, if you continue to build on this data, you can unlock effective audience targeting by building out a cross-device identity graph. If you haven’t thought about the data you have access to, and how you can harness it, now is the time to do so.

Publishers will be able to draw a direct line between first party data and revenue generation. A new set of identifiers will rely on a new UX for publishers and users.

So, expect a whole lot more registration pages coming at you as Publishers with free content models build their 1st party data. We know context can be as powerful as buying an audience in driving results. Context can also be used for driving planning and rich insights as well as performance.

Within the industry, Digital Out of Home and connected TV will likely shift from its emerging-technology status to utterly transform the way traditional media is thought about. Data driven smart creative will pick up pace. Eye catching and engaging messaging that users want to engage with will deliver improved results and better experiences.

How should brands and marketers prepare for a post-Cookie world?

Hannah Cooper – Group Head, NSW Agency Sales at Quantcast

Today, the ad tech lumascape is like a game of telephone. At every junction you’re losing information. You also lose fidelity and about 60 percent of the people on your list. The solution to this is to go direct. Fundamentally, we need to more directly connect marketers with publishers and end web users in a much more sustainable fashion that’s less segmented.  When talking about going direct, it’s important for companies to work together in areas where you can tie identification, data, activation and measurement together as closely as possible which is what we do at Quantcast. When you decouple these, you become blind and things become harder.

Anthony Mogensen – Head of Digital, Sydney at Nine

Firstly, brands and marketers should look to develop their own 1st party data asset built on the foundation of customer identity to reduce reliance on cookies. This includes building 1:1 relationships with their customers to capture email addresses, phone numbers or other unique and persistent identifiers that they can use to build rich customer profiles and create a personalised experiences whenever and however that user engages with the brand. It also includes putting in place data infrastructure that allows the brand to activate people-based data for advertising targeting and measurement when cookies are no longer supported in the ecosystem. This might involve investing in a customer data platform and working with your agencies and partners to ensure its correctly integrated with your activation platforms.

Secondly, brands and marketers should look to develop closer partnerships with publishers. Publishers with scale, high quality contextual environments to tell brand stories, and an engaged valuable audience will provide brands with solutions for continuing to achieve media efficiency. Publishers with a large people-based data footprint will also help brands to match audiences and target them across their networks. Since the merger with Fairfax in Dec 2018, Nine has created the largest data asset of any Australian media business with over 12m signed in users. We are well placed for helping marketers navigate these upcoming challenges.

Vishal Shah – Solutions Lead, ANZ at MiQ

The most important thing to remember is that tailored digital advertising isn’t going to go away. The mechanisms used to deliver it will change to incorporate better privacy and choice for consumers. There is no silver bullet for the replacement of the 3rd party cookie. You will need a diverse strategy.

The good news is the industry has 2 years (and ticking) to prepare, test and ensure that an ecosystem is in place for advertisers, technology platforms and publishers to grow their businesses in new ways. Cookie availability is likely to continue for the medium-term as Google works through these changes to its browser. Google has stressed these changes will only happen once their new approaches “have addressed the needs of users, publishers, and advertisers.”

Relevant advertising is still possible – cookies are an archaic technology. The industry is collaborating to look at different (and hopefully better) underlying mechanisms in its place. Smart marketers are preparing for the removal of the cookie today, so that it doesn’t disrupt operations in 2 years-time.

Dan Richardson – Head of Data at Verizon

For brands and marketer’s opt-in, first-party data and CRM lists will be the most direct and future-proof and connect with their consumers. To set themselves up for future success they must focus on two things:

  1. Upholding stringent privacy standards to maintain consumer trust through these challenging times;
  2. Sustaining consumer engagement with intelligent brand building campaigns to maintain and grow vital first-party databases.

It is worth noting that growing first-party data alone will not be sufficient to counter-act the changes that are underway with third party cookie blocking by the browsers across the open web. It must be a sum of all parts approach. Brands and marketers should ensure that their Publisher and Technology partners are equipped to receive and activate on a cookie-less identity (such as hashed email ID’s) across both the demand and supply side of the ecosystem. This will assist with targeting, measurement and cost-efficiencies derived from frequency capping and cross-device personalisation.

Brands should also be cognisant of the fact that Chrome 2020 will place overarching control of the way they can target, measure and buy (programmatic ad auction) with one single browser. These changes will indeed impact the ability to choose which partners a marketer can work with, and, to activate big ideas that exist outside the walled garden ecosystems. As an industry we must secure the privacy of consumers, but equally, we must be careful that privacy is not just a trojan horse for anti-competitive behaviour.

What new data-driven alternatives do you think could emerge as a result?

Anthony Mogensen – Head of Digital, Sydney at Nine

Whilst it’s not new, we are likely to see increased adoption of addressable advertising leveraging user identity. Facebook and Google have traditionally been the go-to destinations for addressable advertising, but this has evolved in recent years as addressable advertising in the BVOD market has scaled.

We are likely to see use of addressable advertising continue to expand beyond the digital platforms, as 1:1 targeting across BVOD reaches maturity and addressable advertising across the open web can be achieved at scale with major publishers.

Other forms of data-driven alternatives will be key-word targeting allowing brands to achieve hyper-contextual targeting of relevant articles around a particular topic, wherever they may sit on a publisher’s site. When you overlay sentiment, this becomes a powerful target solution for driving increased relevance of ad messaging – and it’s one area Nine is focused on developing.

Vishal Shah – Solutions Lead, ANZ at MiQ

Contextual targeting is the obvious low-hanging fruit. But digital out of home, mobile, connected TV, and audio are all growing steadily to become the biggest channels for programmatic investment – and they also all happen to be cookie-less.

Supply-side partners are already hard at work planning to find other ways to monetize their user-base when the cookie finally crumbles. We’re already seeing them looking to get ahead by capturing data such as email addresses in return for access to online content. The RTB auction process is set to undergo a facelift to ensure these data signals can be passed along for activation, so identity resolution partners such as Liveramp will play a big part in the future of targeting.

For some time, we have noted that the ad tech ecosystem is dividing into two webs: the ‘closed’ and the ‘open’ web.

The ‘closed’ web – walled garden environments like Google, Amazon, and Facebook – allow restricted access to data as well as what you can do with it. The step forward here for brands and marketers would be to equip teams with necessary technological investment or partner with companies that are already ahead of the curve in this space.

The goal would be to:

  1. Replicate existing functionality on top of say, Google’s Ads Data Hub.
  2. Explore and prepare to build on top of further data clean rooms from other walled gardens likely to enter the space.

The ‘open’ web – The rest of the internet – more flexible and diverse. The developments we are likely to see here include:

  1. Accelerated investments in channel diversification across mobile, audio, connected TV and DOOH (none of which rely on cookies)
  2. Contextual strategies involving domain and URL parsing
  3. Macro signals that influence behaviour such as weather, fuel prices
  4. Geo-contextual signals that can be used across the media spectrum, not just display
  5. Alternatives to cookie-based identity, such as logged-in data
  6. R&D investments into cookie-less targeting & measurement solutions

At MiQ we have a) identified ways of growing across both the open and closed web, whilst also b) unlocking sustainability in the meantime. Reflecting on this, in 2020, our product work streams have incorporated a lot of the above cookie-less initiatives, backed by significant focus and investment.

Other Initiatives – Project Rearc:

Project Rearc is a collaborative effort by the IAB’s Tech Lab division, which comprises stakeholders from publishers, analytics, tech companies, and marketers.

The objective is to engage global stakeholders across the industry with a view to re-architect digital marketing with alternatives to 3P cookies that support:

  • A robust Open Web that fuels innovation in content and services
  • Consumer transparency, choice, and control across all experiences
  • More explicit relationships between 1st parties & trusted 3rd parties
  • Open standards that support interoperability and efficiency
  • Improved industry accountability and trust

The expected outcomes of this initiative are:

  1. A set of technical standards and guidelines for the industry
  2. Compliance program

Dan Richardson – Head of Data at Verizon

Consumers expect their personal data to be earned, not just harvested. With accelerated adoption of digital platforms during the pandemic, consumers are likely to feel even more violated by the lack of transparency around how their data is used; in particular, for advertising.

The changes to cookies have forced a refocusing on the production of original content, services and improving the way we personalise content delivery across devices. This is a good thing for consumers and publishers alike.

For advertising on the open web, we will see a change to digital media metrics, particularly conversion attribution. Chrome’s ‘Sandbox’ changes reduce the ability of marketers to target and measure on an individual level, favouring aggregated interest groups or cohorts instead. In this respect may see the cost-per acquisition (CPA) metric replaced by conversion ‘lift’ reporting – similar to current brand ‘lift studies’.

Hannah Cooper – Group Head, NSW Agency Sales at Quantcast

Having a relationship where you’re transparent about what data is being used, allowing users to opt out when they want to and be forgotten when they want to, is really important to make sure the economic system caters to the end web user and makes it as friction-less as possible. These mechanisms of being transparent with end users, collecting consent and collecting information, which will allow you to build a relationship over time, and doing all of this in a respectful way is going to be something all brands and publishers will have to lean into. This has been a focus for us at Quantcast, our work with the IAB Europe has helped create the transparency consent framework for publishers and advertisers to remain compliant with GDPR.

 

Thanks to Verizon Media, Nine, MiQ and Quantcast for collaborating on this article.

If you are a brand or business looking for strategies to thrive in a post-cookie world please reach out to us.

 

 

 

 

 

 

 

 

 

 

 

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