Why cookieless and privacy first come hand in hand

Technically speaking, the end of third-party cookies only affects the ability of marketers to identify users on websites they don’t own. While browsers like Firefox and Safari don’t support 3P cookies anymore since years, the whole discussion is driven by Google as Chrome is by far the most used browser. No matter what Google’s intentions are to delay the phase out one more time, the term “cookieless” also stands for the privacy first ad ecosystem of tomorrow. The massive storage of 3P cookies on user devices must be stopped to comply with strict data privacy laws that come up almost everywhere.

Latest developments in the ecosystem of native apps show that user identification will not only be limited in mobile web. On iOS devices, Apple’s App Tracking Transparency (ATT) leads to low availabilities of IDFAs and Apple will probably make the next step with its own ad platform. On Android devices, Google plans to completely eliminate GAID as soon as its privacy sandbox is up and running.

In general, marketers will still be able to target groups of users but it will be tough to get identifiable data out of user touch points they don’t own. Apple’s ATT already shows that many users aren’t willing to provide consent. As a result, ad performance will suffer, prices for ad units will go down and the whole ecosystem must adapt. Furthermore, the whole programmatic industry must rethink the value chain as many processes rely on 3P cookies. The higher the distance to end users the harder it will be to compete. The exchange of cookie IDs to increase the value of users for free will definitely come to an end.

Get used to lower addressability

Maximize addressability using 1P data

While it will not be possible to identify as many users as today, it’s key to collect 1P data at scale through direct user contact. This 1P data can be based on email addresses, names, and universal IDs of potential customers. Usually, brands collect this kind of data on their own websites after the consent for the data processing was provided. Consent management is key, no matter if you talk about mobile web or native apps. In contrast to 3P cookies, brands will have to deal with multiple identifiers and make use of graph solutions to match user profiles. The more 1P data available the better the marketing ROI. Alternative identifiers like ID5, Lotame’s Panorama ID, and UID2 were already tested successfully and are available at scale. However, cross channel remarketing will suffer and looking at probabilistic identifiers, the accuracy is also much lower as known from deterministic system, such as 3P cookies.

There are two ways to activate your 1P data. First, many small to medium publishers will support all kinds of alternative identifiers, so you will still be able to re-target users programmatically. Second, many premium publishers will take the opportunity of dying cookies to increase the value of their inventory - they won’t provide their 1P data (for free). Publishers and advertisers will use data clean rooms to leverage their data without actually revealing it to the other party. The setup of these direct partnerships will definitely be more resource consuming and advertisers won’t be able to store any personalized data on users that don’t visit their website or app.

Use alternatives to 1-to-1 remarketing

With identification going down, more unknown users will be reached. To get the maximum out of your ad dollar it’s crucial to evaluate channels with the help of non-personalized information. So, it’s pretty clear that contextual targeting is gaining in importance again. In case you are not aware of the latest developments, you can have a look at our latest article on this topic. While DSPs add more and more functionality, 3P providers of contextual data like Grapeshot, Verity, or IAS can also be used for pre-bid targeting. Data clean rooms can also be used to enrich your 1P data and identify valuable audiences.

Besides contextual information, publishers’ very granular 1P data on user behaviour will also be of higher importance to reach the right audience. Providers like Permutive support the supply side to leverage their inventory and seller-defined audiences by IAB enable publishers to segment their 1P audience data into relevant cohorts. Trust in publishers and SSPs you directly work with is key as it will be tough to check accuracy on your own.

Rethink measurement and attribution

Decreased addressability has strong negative feedback on the possibility to attribute conversions to single activities and to measure the success of single channels. Again, marketers can use data clean rooms to get anonymous conversion reports. However, this might not be an option for small players as you need scale to justify the effort. When talking about marketing mix modelling again, scale matters. While you will still reach the same users out there, very granular evaluations will probably come to an end. Good news: Brand safety is almost not affected as brand safety mechanisms are mainly about the content and will become even more important. Even with limited targeting capabilities, showing the right ad to the right user at the right time still decides on campaign performance. So, we also expect creatives to gain further importance.

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