The coming “cookie-pocalypse,” as Amanda Tan, project management lead for identity at advertising technology firm Xandr, describes the impact of Google’s abandonment of third-party cookies, has required “players to come together and innovate.” Describing the platform’s omnichannel focus on both the buy and sell sides of the marketplace, she notes that “Xandr is in a unique space right now to champion this partnership and collaboration across the industry.”
“Personally, I’m very optimistic,” says Lara Koenig, global product lead at MiQ, a programmatic media company. “There’s been a lot of really exciting innovation and collaboration happening. It feels like a new wave of programmatic, and we’ve never been closer to both the buy side and the sell side. A lot of folks are really excited by this challenge, and the energy is palpable.”
Koenig’s colleague, John Goulding, MiQ’s head of strategy, echoes her excitement. “It is definitely catalyzing new ways of thinking,” he says. “Some things we may have accepted in the past are now being challenged, and there are some really interesting, innovative solutions that are genuinely progressive for both consumers and the industry itself. It’s having a catalytic effect on the rate of innovation that will actually increase, rather than fall off, in the next 12 months.”
An Upside, Whatever Side You’re On
The positive sentiments expressed by these three ad tech executives, and the praise they heap on an industry that has come together, against many if not all odds to solve what some initially saw as an intractable problem, has been a running theme in this series on “life after cookies.” Rather than wringing hands, everyone sees an upside. Those on the sell side expand on the promise of such platforms as LiveRamp’s IdentityLink and The Trade Desk’s Unified ID 2.0. Those on the buy side champion the strength—and what they see as the dominance—of publishers’ first-party data. The BigTech companies, which, in essence, launched this revolution, are tending their walled gardens, secure in their control of vast stores of consumer data. And those who play on the open internet, such as Xandr, say that, for anyone in the industry, as Tan puts it, “if they have a foundation of trusted relationships with their customers, they are able to use the various frameworks and opportunities that are available to leverage those relationships and data.”
“We’ve really seen that being agnostic is giving us a very beneficial top-level view on where the collaboration and innovation is happening.”
Koenig points out that while a lot of the innovation she sees happening on the sell side “is forcing buyers to get close to the sell side, it’s also forcing buyers to think about the role all players play in delivering their marketing campaigns. We’ve really seen that being agnostic is giving us a very beneficial top-level view on where the collaboration and innovation is happening. It’s moving more toward the ability for marketing to work with both platforms—buy side and sell side platforms together.”
The Pivoting Landscape
The real question, then, is not whether the industry will pull together to develop post-cookie solutions. That’s already happened. And it’s not whether those solutions, taken together across the industry, will provide viable replacements for third-party cookies. The innovations to shape changes in data collection and measurability are already rolling out. The question is what all of this will look like two years from now, once third-party cookies are a distant memory, once there’s been a consolidation among advertising platforms, once what Tan calls the “pivoting landscape” at the “intersection of digital and TV” is more established.
Goulding believes “we’re headed toward a world that is divided between two classes of digital advertising data.” One of these, he says, represented by UID 2.0 and IdentityLink, is authenticated user-level data: “They’re opted in, they’re hashed, they’re individual level, offering the maximum amount of flexibility in terms of use case for an advertiser.” Most significant here, he points out, is that “the data is incredibly insightful.” On the other hand, because it is opted in, “you’re not going to get complete addressability,” and, he predicts, no more than 40% of consumers “will actually opt into that model.”
Reaching everyone else, he says, will require cohort-based data: aggregated by design and focused on identifying groups of users, rather than individuals. While this data is, he says, “likely to have very high reach of consumers,” compared to user-level data, it won’t be very insightful.
“A key question the industry will face a few years from now is, ‘Can you extract insight from the authenticated user data to make your cohort-based execution smarter?’”
And that, Goulding says, raises a key question the industry will face a few years from now: “Can you extract insight from the authenticated user data to make your cohort-based execution smarter?”
Meeting the Future
For Tan, the key to meeting the future is an omnichannel approach. “I think the tech landscape and the advertising landscape will continue to evolve,” she says. “Things are coming together with new ID solutions and cohort-based approaches to targeting and measurement that work across different channels.” This, she believes, allows both brands and the industry as a whole to “understand their customers and manage exposure across the various devices and channels of media consumption.”
Tan says the industry is seeing “a shift in terms of viewing habits.” Instead of watching traditional TV all of the time, consumers are moving to connected TV and mobile viewing. For Xandr, says Tan, that’s already showing up as a “very strong focus on data-driven video and TV ads, which complements our existing strengths on the web.” This overall shift, Tan believes, “is a great opportunity to bring together some of these disparate approaches to channel-specific media buying strategies.”
Getting ready for this shift, says Koenig, requires thinking first about “what you can do for targeting and addressability,” and then considering “what you can do for measurement and attribution.” In line with the former, Koenig notes that MiQ is “personally reaching out to most of our marketers” to get them familiar with these new approaches versus traditional strategies. At the same time, she advocates “leaning into” advanced contextual targeting, which she says is a “well-loved but little talked-about strategy.” And she suggests paying attention to cohort-based or federated targeting, which, she says, “the industry is waiting to drop over the next several months.”
From a measurement point of view, Koenig believes it is currently “more of a research exercise than anything else,” but she suggests that it’s time to “open a dialogue” on this topic because “things are going to change.”
It’s the constant change that drives Goulding to suggest that advertisers, as they prepare for the cookie-less future, concentrate on “education, auditing, and testing. Education because this is changing every month”; auditing, so that “advertisers understand where they are actually most reliant on cookies today”; and testing rapidly, “to be agile, keep your options open, and stay close to how this progresses.”
The last word, however, belongs to Amanda Tan. “Xandr’s combined assets and the conversations that we’re having with the market in which we’re thinking ultimately about converged omnichannel campaigns are really interesting,” she says. “The key is that all parties have to just take control of the problem, understand the implications to their business model, and not wait for others to find the solution for them. Buyers and sellers know what is best for their businesses, and each will need to differentiate according to their strengths and make decisions on which solutions will optimize their approach. Platforms are here to enable that choice and control.”
