Brands can take advantage of the slow death of cookies but it may mean those quick digital performance bursts become harder to manage, say industry experts.
Google last week announced it wouldn't be building alternative identifiers to track users around the web once third-party cookies have been phased out. Instead, the company committed to using its alternative solutions, such as FloC which anonymises users.
Brian Wieser, Global President of Business Intelligence at GroupM says one of the knock-on effects at the brand manager/business unit manager level could be an opportunity to reassess the allocation of resources to longer-term brand-building versus shorter-term performance-based goals.
"The news was significant for how it concentrated many minds in the industry around the meaningful ways in which marketers and agencies will need to change workflows to optimise their digital advertising budgets to accomplish existing goals," says Wieser.
"On the other hand, it’s also significant as a reminder to brand owners that changes to how ads can be targeted should lead to a reassessment of the balance of resource allocations between 'performance' and brand-building, which, of course, are not necessarily mutually exclusive."
Jason Davey, chief experience and innovation officer, Ogilvy, says advertising is the currency used to pay for content, so there must be a balance between the needs of the consumer, publishers and advertisers.
"Google’s cohort approach appears to solve the challenge with privacy but there are other things to consider," says Davey.
"By taking a proprietary cohort approach, Google is leveraging its massive scale of digital properties which is limiting competition from independent publishers who don’t have the same scale to offer.
“An industry-wide approach would ensure publishers are focused on developing quality content to attract audiences and advertisers, rather than forcing them to create quantities of content to build effective targeting profiles.
“Studies by the IAB and Google themselves show that the brand and creative contribute more than 70% toward an ad’s conversion, so there’s an opportunity for every advertiser to improve effectiveness, whilst publishers grapple with the cookie replacement.”
James Lawrence, co-founder at Rocket, says the large platforms are realising change is coming and he sees this as a small step backwards for advertisers in the larger context of many large leaps forward.
"There is an overarching public sentiment that the current balance isn’t right in terms of privacy, tracking and advertising," he says.
"Google wants to be ahead of the curve in terms of public sentiment but more importantly potential regulatory intervention. Google makes too much money from allowing businesses to effectively build high quality audiences of prospective customers to destroy the model.
"The fundamentals won’t change, this will be a tweak, but not destroy digital targeting as we know it. Businesses don’t need to fear that we will go back twenty years to the point where we can’t effectively target prospective customers."
Konrad Feldman, co-founder and CEO, Quantcast, says Google’s decision to back away from industry-wide identity initiatives is bad news for publishers and content creators.
"Nearly 5 billion people rely on the open internet for access to quality and trustworthy information, news, education and entertainment," says Feldman.
"Google has again shown its willingness to degrade the relevancy of advertising on the open internet; what they are doing will benefit its cash cows of search and YouTube which are unaffected by this move. As the open internet becomes harder to deliver effective advertising on, or even to simply measure the effectiveness of advertising on, more ad dollars will pour into the coffers of the tech giants at the expense of the free and open internet.
"Our position is that we need to help even more in providing an alternative to walled garden approaches. We have the platform, live data, and machine learning capabilities to deliver outstanding outcomes that rival the tech giants and level the advertising playing field for brands, agencies and publishers on the open internet.
"We do not believe there is a one-size-fits-all solution to identity and that is why in addition to innovating in building our own identity solution we are also participating in cross-industry initiatives such as the IAB Tech Lab’s Project Rearc and the W3C and will interoperate with emerging industry identity approaches such as UID2.0 and proprietary identity technologies from companies such as LiveRamp."
James Keeler, chief experience officer, whiteGREY & Grey AMEA, says there is no reason why the number of people looking to buy a good/service will change but it will be harder to find those people looking to buy a particular type of good/service, as advertisers will have access to less data than they had before.
"The changes we are seeing in targeting and data products due to the evolving privacy landscape are the biggest we’ve seen in a long time, and we are losing the ability to track and measure behaviour in the ways we have become accustomed to," says Keeler.
"Advertisers need to find new ways of targeting potential buyers, and there will be a lot of new products to review from a range of companies and data providers, and a lot of test and learn will be required to see what works best across different businesses and industries.
"Google’s Privacy Sandbox and FLoC are examples of new products to be tested, but there will be hundreds of others. Google still has access to a huge volume of data without using third party cookies, so I would expect their products to be very competitive, but we should expect the level of accuracy delivered by these types of products to get better over time.
"There is the opportunity for brands who adapt to the new ways or working quickest to gain market share in the short-medium term. All online advertisers are being impacted, so those who respond the quickest, start testing early and optimise in the new world, will be best placed to find those consumers in the market for a product/service, and should therefore gain competitive advantage, and increase their share of the market.”
Samuel Tan, JAPAC Director of Market Development, Xandr, says the opportunity for advertisers is to take back control over the experiences they want customers or prospects to engage in.
"They can move to explicit opt-in to embrace genuine fans of their brand, discover potential customers through like-minded content of interest or amplify the great value that existing customers have from their products," says Tan.
"None of these notions are new to advertising but to execute them holistically requires a brand to embrace the complexity of the digital ecosystem and cherish the relationship with the consumer. Xandr has always encouraged buyers and sellers to consider the advantages of control and transparency available through platforms of the open internet.
"We will continue to invest in a comprehensive, multi-faceted identity roadmap, to deliver relevant advertising delivered in a privacy-safe environment. This offers advertisers alternatives to other, more narrow approaches and as more of the marketplace leans into this choice, it allows brands a genuine chance to engage with platforms on their own terms."
Jessica Beaton, director, APAC media and digital marketing at The Walt Disney Company, says advertisers need to start planning sooner, rather than later.
“Everyone is talking about cookies being depreciated in 2022 but we forget [that] they've already started being depreciated," Beaton told the Quantcast Virtual NOVA Event: Advertising in 2021 and Beyond.
"Ultimately, we have to stop using 2022 as this deadline and realise we're living with this right now; [we have to] assess the [current] solutions and [examine] the most promising options.”
She also believes the escape from the ‘walled gardens will be led by Gen Z, who are driving changes in consumption.
“Generation Z [are] going to change our impact. If you look at their media consumption, they are shifting away from traditional walled gardens in a lot of ways. I'm sure they will create new ones in their own time, but, at the moment, if advertisers try to go after a new generation, they [definitely] have the impetus to do it, along with the shift in measurement," she says.
David Jackson, CEO of Australian LifeTech, says COVID-19 forced many brands to accelerate thinking.
“We need to make sure we're thinking ahead of the curve [and] that we have partners that are also thinking ahead of the curve," he says.
"Three years ago, probably 80% or 90% of our digital marketing spend was with Facebook and Instagram. Now, that sits below 50%.
"We’re now focused on building communities that sit around our business to ensure we have those direct relationships to help future proof us and reduce reliance on some of the big players.”
Nick Barnett, digital and data consultant, says strategists needed to start developing plans for a post-cookie world.
“Most, if not, all digital platforms are using sources of third-party data that come from cookies," he says.
"Unfortunately, the lifeblood of those activities is going to disappear. We need to start thinking: ‘Can I remarket effectively?’ It’s a basic tactic.
"As a starting point with first-party data, you need to get retargeting and suppression right. First-party data will allow you to build those remarketing pools of customers and potential customers to speak to again, and to sell to. Suppression, equally, is a way of freeing up more budget and preventing budget wastage.”
Alyson Williams, senior vice president, Digital Operations and Strategy at Forbes, says first-party data will change the way advertisers approach and interact with consumers:
“It’s really important to keep in mind why we're getting rid of the cookie, which, at the heart of it, is because of user privacy concerns," says Williams.
"[First]-party data and contextual solutions are moving forward [and are] going to be the safest and [most] user-friendly approach – that's really what we're focusing on.
"[It] gives companies like us the chance [to] grow our logged-in experiences and create more direct relationships with audiences – that's going to be key for publishers moving forward. Now, we're really trying to focus on just educating our sellers and clients on what that means for how we sell and how they buy.”
Finding a point of difference is key.
“The nature of a walled garden is that if you're not in it, you're at a disadvantage," says Williams.
"Unfortunately, I think smaller publishers are really going to feel that the most. I think [small publishers] need to focus on differentiating themselves from those walled gardens. Look at what they can offer that the walled gardens can’t.
"We have unique content and audiences that they don't – how can we really capitalise on that? It’s important to diversify revenue to make it not just about digital advertising, but about events, communities and experiences.”
On the topic of measurement, Disney’s Beaton says the depreciation of cookies will pave the way for solutions that will improve the industry in general.
“We need to get to a place of universal measurement, and that will reinforce the strength of digital all around. That’s why we’re here, to be able to measure our impact and reach people in a personalised way," Beaton says.
With the future of advertising centered around first-party data, panelists at the Quantcast Virtual NOVA Event touched on customer-centricity as key for all players going forward.
“The focus now is really about understanding how we’re going to go into data segmentation and customisation. We need to look at a better way of using data so that we can add more value to the customer,” says Marilyn Yeong, regional client vice president at ForwardPMX.
Jason Scott, CEO, MiQ Digital, says identity is at the nucleus of measurement.
"It's one of the reasons online is so beneficial to advertisers because it offers such rich measurement," he says.
"What will change is the way we infer identity and how that can be achieved through a combination of data points. What replaces cookies won’t be singular - there’s no silver bullet.
"But, by using a combination of first party data, advanced contextual, and Chrome’s privacy sandbox activation solutions, we’ll still be able to track and measure behaviour. Of course, connecting all those things and making them work together will mean a change in the process and the level of sophistication of managing your online advertising."
Scott says consumer privacy is the key to rebuilding trust in the value exchange of the ad-funded internet.
"This is an opportunity to give people more choice in how they want to fund their online experience, whether they choose to share some of their information to offset content costs via an advertising model, or they choose not to share any data and pay a subscription," he says.
"So, in many ways, I think this is a major win for the rest of the open web, at least for now. Even though Google Ads won’t appear to support some of the initiatives such as UID2.0 via Prebid, these practices are still possible among the wider set of ecosystems. This should spark some clear motivation for innovation opportunities for the industry outside the walled gardens."
Steve Millward, general manager, commercial, at smrtr: "The announcement made by Google is a great leveller as it applies to everyone in the same way. It also provides brands with a great opportunity to start working with microsegments of consumers and have connected measurements through all marketing channels. There is a lot more data available for these segments that can used to engage with potential customers earlier or activate potential buyers, as the measurement of individuals, click-throughs and purchases will become less quantifiable."
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