AdExchanger touts its Industry Preview event as an immersive analysis of the trends predicted to drive ad technology and digital marketing in the upcoming 12 months. While that was certainly the focus, I found that this gathering was actually thinking far beyond the next 12 months, exploring how technology will shape the next decade.
There was an air of soul searching as every panelist acknowledged the game-changing Chrome announcement. It’s clear that first-party data will become even more critical, as the industry shifts to privacy-first, safe-data-driven marketing in a cookie-less world. Ad technology has officially entered a midlife crisis.
Every session, no matter the core theme, directly or obliquely acknowledged the long-expected and now imminent death knell of cookies. Simply put, no one has a clear stance on the best road forward. There are numerous theorized outcomes, but what is certain is that at the end of the day, the entire industry is in this together. While this move has been prognosticated for many years prior, the Chrome announcement seems to be a wakeup call that the death of the cookie is not a new topic, but it’s newly urgent.
With such a potentially disruptive change on the horizon, it’s obvious why the conference focused so much on what the next era of digital marketing will look like. Here were my biggest takeaways on the state of the cookie-less union:
Who Will Struggle?
Any ad-tech company that has its core offering or architecture leveraging third-party cookies (as in, the vast majority of ad tech) will need to evaluate if they will remain viable. Retargeting, frequency capping, multi-touch attribution and others of granular measures will effectively cease to function unless a wider addressability solution is devised. Anyone who has any of these features as a key pillar of their offering will need to go back to the drawing board.
Longer tail publishers will also face a challenge, as behavioral targeting is sidelined. According to one Google finding, sites could lose as much as 52% of their revenue when cookies disappear. This is a staggering number and will require that publishers really get creative to maintain their bedrock monetization strategy.
There are ways to survive though, and one exciting prospect is to reintroduce contextual targeting as an effective replacement for behavioral targeting. Adswerve’s VP of Strategy, Kristina Goldberg, noted in her assessment of Programmatic IO, contextual targeting in 2020 and beyond will be substantially improved. She notes that contextual will “go from what was historically based on keywords and semantics from one source toward using multiple signals and sources to more accurately predict and determine intent, sentiment and emotion. In short, in a cookie-less world, we can still deliver an optimal experience to an end user with near precision.”
Who Can Adapt?
Larger and more data savvy publishers have a great opportunity in this disruption. Clearly, getting a handle on first-party data is a priority, but they will then have to package and educate (or re-educate) on the value their datasets can bring in a more anonymous way. Having a larger standardization of PMP deals across DSPs could accelerate and automate the way advertisers buy. On the front end, with one-to-one audience targeting not possible in the foreseeable future, it will become a lot more common to see publishers putting login walls around their sites in an effort to better understand and monetize their user bases. It may create a subpar user experience, but we can anticipate publishers getting scrappy about collecting as much first-party data as possible.
From the advertiser’s perspective, reporting granularity will be vastly decreased (for now), but there is an opportunity to reframe expectations around display advertising. After all, 2019 was the first year digital overtook traditional media in spending, and display will still continue to be regarded as a key tactic, even in a less precise world.
Great disruption creates great innovation, and we are also excited to see emerging new options with formats like Connected TV (CTV) and even a channel as tried and true as Search. CTV was a very hot topic at the conference and one to watch much more closely as the Streaming Wars heat up. Agencies, while navigating the in-housing trend over the last several years, may be called on to help produce powerful and inspiring creative that can help fill gaps left in the absence of addressability.
Who Is Well-Positioned?
It goes without saying that the largest benefactors will be Google, Facebook and Amazon, as the most powerful digital currency will be the strength and accuracy of first-party data. No matter the size of the organization, the biggest winners will be those who fundamentally understand how to work with data and algorithms, and how to leverage without stepping on a privacy landmine. It’s time to start thinking about the state of your data (or lack thereof) right now.
Charles Farina, our Head of Innovation at Adswerve, provides a great outline, wherever you find yourself in the industry. For advertisers, tools like Ads Data Hub create a safe-data clean room by unifying data across multiple sources and channels. This allows brands to effectively stitch together their customer data into one platform, but will require a sophisticated team to accurately put all the pieces together. Investing in the right talent and/or service partners will be something to carefully consider in the new decade of digital marketing.
We are all feeling the uncertainty but also solidarity. The Google Chrome team is openly asking and welcoming feedback, and seems to be making an earnest attempt at a phased and responsible approach to deprecating cookies. There is space for us, as an industry, to contribute to the conversation.
It is still to be determined whether or not addressability will ever be the same as we had known it, but if one thing is crystal clear: a deep investment in first-party data will be paramount. Adswerve CEO Clint Tasset summed this up succinctly in his latest post: “Integrating analytics and media functions under one roof isn’t just an efficiency play. In a world where public privacy concerns have been propelled by a series of high-profile breakdowns in trust, keeping a tight lid on your data operation is critical to protecting brand reputation.”
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