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Digital Marketing Tips: Preparing for the Death of Third-Party Cookies

Written by:   |  Analytics, Strategy  |  January 21, 2021  |  0 comments

With all the chaos of the last 9 months, you may not remember the important news about third-party cookies and how they will impact marketing going forward. No, I’m not talking about the sugar high and increased productivity that comes with incredible chocolate chip cookies. (Though here’s an amazing recipe if that’s what you thought this post was about. Pro tip – Double the vanilla extract and add a pinch more salt and these bad boys will be next level.)

Instead, I’m talking about the upcoming death of third-party cookies and how that will impact marketers’ ability to target their messages. Click here if you need a bit of a recap on cookies, how they’ve been used, and why this change is important.

What you need to know:

  • Historically, third-party cookies have allowed brands to target ads to their desired audience (among other things)
  • There has been a lack of regulation with respect to the data these cookies collect, how this data is stored, and how this data is used – leading to an exponential increase in usage and abuse by some predatory advertising platforms
  • Privacy concerns have prompted web browsers like Safari and Firefox to block third-party cookies, Google’s Chrome browser will begin blocking them in 2022
  • With this change, marketers will lose the ability to accurately and precisely target the right consumer with the right offering or message and the ability to measure the impact of said campaigns
  • target their ads to their audience at the level that they have enjoyed previously
  • This will increase costs and reduce ad effectiveness unless an alternate solution is found
  • Since Google’s announcement the industry has been freaking out with uncertainty over how we’ll be able to target ads properly
  • No one solution has been confirmed but there are several promising options out there

The industry has been attempting to develop a solution that is platform agnostic, secure, and provides significant upgrades to consumer privacy but a bunch of recent partnerships with Nielsen, Criteo, and LiveRamp makes the Unified ID 2.0 solution a very viable option. The solution is still in development, but it was released in beta a few weeks ago and is expected to be available to the industry later this year.

What is Unified ID 2.0?

It is an industry solution that has been developed as part of the IAB Tech Lab’s Project Rearc. A number of industry partners are contributing code with The Trade Desk (a leading programmatic solution) contributing a significant chunk of engineering resources. The idea is that once complete, the solution would be turned over to an independent industry body that would take over governance, ensuring a level playing field for all advertising platforms. This is a critical piece and is a major reason why many in the industry believe that this is a superior solution over Chromium’s Privacy Sandbox, who many expect to provide Google with more data thereby increasing their control over the digital advertising ecosystem.

How does Unified ID 2.0 work?

Though it is still a work in progress and there are many elements that still need to be determined so this could change once we learn more. However, based on what we know today, the basic tenets of the system are:

  • Consumers would sign up with their email address for the program
  • They would verify their email ONE TIME only and be able to establish default privacy settings
  • The system uses encrypted, hashed email addresses to create a standard identity replacement for the cookie
  • This email address is not shared with advertisers or platforms, instead they would receive the Unified ID 2.0 
  • As users visit websites, they would be prompted on the first visit only to consent to the level of information that they feel comfortable sharing with that site (Sidebar – Research from Experian found that 70% of consumers would share more data if there was a perceived benefit to them, so website owners that embrace the value/data/security equation will be rewarded and spammy sites will be punished.
  • As a user navigates between devices, their selection is remembered which ensures a better user experience cross-device as they won’t be annoyed having to consent on every single device. 

Still confused? Here’s a short (4 minute) video overview from the CEO of The Trade Desk if video is your thing.

What are the benefits of Unified ID 2.0?

  • Consumer control – the user is in charge of their data
  • Improved security, encryption, and technology
  • Truly level playing field, no one ad platform has an advantage over others

So, what should marketers do? 

Well, first of all, go bake some cookies and you’ll be in a much better mood to tackle the list below as this is going to require some work.

Review your data collection practices

Canadian Privacy Legislation is changing and it is expected that we will have our own version that is similar to GDPR in about 2 years time. Use this time to ensure you have ethical data collection and storage practices.

Improve your own first party data collection and integration

You already know that you need to prioritize collecting customer data but it’s not enough to just collect this data. The real power comes from integrating multiple data sources and using that data to drive personalization. We’ve seen success for our clients by extracting data from multiple sources, cleaning and transforming it, and then using visualization tools to allow for easy interpretation and decision-making. The holy grail is a single customer view, where you can store each data point on your customers in one place.

Partner with publishers that have obtained first party data through legitimate privacy-centric models (like Unified ID or other solutions)

Every publisher or ad platform is working on a solution so before you execute your next media buy it’s important to understand the targeting that a publisher offers and ensure it’s aligned with the regulatory environment in the jurisdiction where you plan to advertise.

Consider contextual advertising

Test out other means of targeting, perhaps pairing first party data with contextual advertising. It’s critical to do this now so that you understand how to best leverage contextual advertising. There have been tremendous gains in contextual as AI powered platforms have improved significantly over the last 12 months    .

Above all, remain calm

This is a massive shift for the industry and it’s probably going to take a few years for everything to shake out. It is entirely possible that we could have multiple solutions for a period of time but it benefits everyone to have a universal, platform agnostic, secure system. 

If you’re not sure how this change may impact your business and your brain hurts from all of the ambiguity you’re not alone, it IS confusing. If you need some help navigating such a massive change, feel free to send me an email at heather [at] vovia.com

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