Privacy concerns and the use of customer data has hit the mainstream, as people become more aware of how companies are tracking them online via cookies. In the past 12 months, 23 percent of 2,230 UK adults aged 16-75 have opted out of or not consented to requests to install cookies, according to research by Ipsos Mori and TrustArc.
The ability to target specific audiences and attribute that spend in real time, among other things, is at the heart of programmatic. For digital advertising to continue in a privacy-compliant way, the whole industry will need to evolve beyond the use of third-party cookies towards an alternative ID.
Programmatic cannot survive without third-party cookies
Between Apple’s ITP updates, Firefox’s default anti-tracking and Google giving users the option to clear third-party cookies in Chrome, industry reaction ranges from ‘the death of ad tech’ to ‘we’ll evolve’.
For Mathieu Roche, co-founder and CEO of ID5, “programmatic doesn’t survive in its current form”. He explains: ”Programmatic is based on the ability to identify, to individualize messages and performance. So tracking, attribution, frequency capping and audience targeting all rely on the ability to have a code on a device that enables a brand and the publisher to know that this is one person [and] that’s different from the next one that’s going to the page.”
Roche adds: “Individualization is an ID on a device, and today those IDs are third-party IDs, meaning that they are placed by third parties to the site, so the only place where you can put them on the device is on the third-party cookie. So if you take away third-party cookies, you don’t have protocol IDs anymore, which means you don’t have IDs at all because there is no alternative to that, so programmatic doesn’t work without third-party IDs on the device.”
“Soon it’s not just going to just be Safari,” says Paul Gubbins, global programmatic lead at Unruly. “We’ve already seen from publishers in Germany that Firefox changes have massively impacted them and we know that Chrome are now making it a lot easier for users to opt out of third-party cookies.”
Gubbins asks: “At what point does the agency or the DSP start saying, “Look, that’s a black hole of supply, we can’t buy there because we’re not going to manage things like reach, frequency and attribution because there’s no ID in play”. It’s quite terrifying for publishers.”
When asked if RTB can still exist in its current guise, News UK’s commercial director, Ben Walmsley, believes it can, but will “look very different to how it looks today”. And Charlie Glyn, head of programmatic at Havas Media Group, says: “There’s no way this industry’s going to die a sudden death. Maybe it’s not going to be exactly how we’ve done it previously, in the same way that programmatic is no longer just remnant – it’s all types of inventory. It’s just going to evolve.”
Cadi Jones, commercial director, EMEA at BeesWax, points to in-app advertising as an example of the ability to target people beyond third-party cookies. She says: “Think about how much time you spend on mobile devices, [and] how much time you spend in-app. There’s no third-party cookies there and yet people are still able to serve ads.” Jones adds those businesses that are still relying on third-party, scale modelled segments, “will have to change”.
The issue is broader than just programmatic, for Glyn at Havas. “From our perspective measurement is a key one, and it’s not often the case that I can argue that we should just go for a single ID solution that will only impact programmatic. We have to look at how something impacts social and search and everything else… and then what that means for a targeting solution.”
Who should own identity?
Diminishing third-party cookies should democratize identity and help businesses come together to win against the duopoly, according to Walmsley at News UK. The commercial director says there’s always an initial “land grab phrase”, when industries evolve, and believes that “we’ve lost the battle” in terms of owning the infrastructure and application in digital advertising, as Google and Facebook continue to dominate.
Walmsley says: “We’ve lost the infrastructure layer, so now we need to develop and democratize certain parts of that, and that’s what we have to do with identity. “We don’t want a Lumascape of identity,” he says. “It’s not like you’re looking for a supplier in [identity] in the same way that you might choose a DMP. We need to come together around this.”
Some partners and consortiums are also looking at shared identity solutions, using standardized ways of identifying and storing user data without using third-party cookies.
However, Walmsley doesn’t think the solutions that exist today are “ready and adequate to solve the extent of the problem”. He says: “We’re exploring all of the ID solutions that are proliferating in the market, and we’ll need to support as many of those that we think will make a difference. We’re certainly in the early stages, so I don’t have numbers. We’re seeing some [difference] but not as much as we would hope.”
Roche, at ID5, says the solutions are ready, but that “it’s a marketplace approach”. He says: “You need to have liquidity in the marketplace for the marketplace to be available. The tech works. We have publishers passing in ID that sits in the first-party cookie to a buyer who can then reconcile that ID with their own data set, so it works. But it has to be available to scale.”