The Trade Desk's James Bayes on CTV, cookies and audience fragmentation

Jason Pollock
By Jason Pollock | 6 February 2024
James Bayes.

Publishers have been forced to confront the reality that the long-delayed move of disabling third-party cookies for Chrome users is finally happening - and could seriously impact their business.

James Bayes, VP ANZ at The Trade Desk, says although Google's started deprecating and urgency finally seems to be creeping into the sector, he thinks it's too early to say what the impact of that is going to be, but if it follows the erosion of cookies on [Apple browser] Safari, it will have a “material impact” on the funding model for publishers.

“Publishers who went through a similar kind of thing with Safari three or four years ago would say that there was a 50% to 60% erosion of value on that inventory, which is obviously really significant,” he says.

“It remains to be seen whether the impact of that is going to be the same on Chrome, but we certainly saw through Q3 and Q4 last year an acceleration on both the buy and sell side of publishers and advertisers trying to ready themselves for this.”

Bayes says that although on the buy side there are “volumes” of advertisers that are testing alternative targeting and measurement solutions, like Unified ID 2.0, there's a huge amount of work that both those on the buy and sell side need to do to ready themselves.

The Trade Desk has been advising its customers that the first thing to do is to audit what a company’s exposure and reliance to third-party cookies looks like and then start to build a plan from there.

“Fortunately, a lot of brands and advertisers have been investing really significantly in both the technology to underpin a future-forward identity framework, but also investing in building those one-to-one connections with audiences, making sure that they have consent to be able to use the data in the way that they want to and to try to mitigate any downside impact,” he tells AdNews.

“There's been this belief that consumer privacy and cookie deprecation is inevitably going to lead to a decline in the value of inventory and/or the efficacy of that inventory; our view is that that doesn't have to be the case.”

On the connected TV (CTV) front, Bayes says that the problem of accelerated audience fragmentation means that attention is harder to achieve at scale than ever before and for brands, this in turn means that they need to get smarter about how they're stitching together their campaigns across screens.

“YouTube's always been a challenge to manage holistically alongside other forms of video, but now you've got the likes of Amazon Prime, Netflix, Binge – and they’re not just scaling their audiences, which is accelerating audience fragmentation, but they're now starting to enter the ad funded space and walling off their supply as well, which just creates more complexity,” he says.

“Looking at our roadmap, we will shift more in the next 12 months around TV than we ever have before, largely based around helping to solve this issue of fragmentation.”

Part of that roadmap includes a partnership with audience analytics group Samba TV, who The Trade Desk partnered with back in 2020 to give brands and agencies the ability to be able to stitch together broadcast television and BVOD behaviour to drive a more effective BVOD campaign.

AdNews can reveal that not only has that partnership been extended, but that The Trade Desk will be launching a new TV planning product alongside Samba in the coming weeks which will allow the media buying platform to leverage Samba automatic content recognition (ACR) data to identify specific geographic areas that have been under or over exposed to a linear TV campaign.

With about 300,000 households in its panels, Samba’s ACR data – ACR is defined by Digiday as ‘a technology built into smart TVs that enables it to listen and/or see what’s playing on screen’ - allows The Trade Desk to look on a campaign-by-campaign basis at specific postcodes around Australia that have been under or overexposed to a specific campaign within that area, whereby advertisers can either suppress specific postcodes or GEOs on BVOD that have been overexposed, or alternatively actively target and upweight those postcodes that have been underexposed on linear TV.

“This is a really powerful way to stitch together the two screens and more effectively manage frequency so that you can put your money to work more effectively,” he tells AdNews.

“You can do that on your own campaigns or you can do that on competitor campaigns. If there's a competitor that is heavy into a specific region, you can either choose to go hard yourself or pull back in that specific region, but it's a really smart, privacy-centric way to stitch those screens together.”

AdNews can also reveal another extension to the Samba partnership likely to arrive in the next month – a measurement solution which Bayes says will allow for “really sophisticated” granular measurement across linear and BVOD.

Outside of cookies and fragmentation, Bayes predicts that sport will be an important factor in the CTV space in 2024, saying that the Olympics are a “game changer on so many different fronts” as he thinks they'll do for Nine what they did for Seven.

“From a viewer perspective, they're probably the best showcase of what the future of television looks like,” he tells AdNews.

“The ability for 9Now to be able to deliver probably 30 or more streams – whether that’s live, time shifted, short form, long form, curated or personalised streams of content - is the future of TV in a two or three week window and the ability for broadcasters to demonstrate that to audiences and get them excited about what the future of TV looks like is a really significant milestone.”

He also says Seven picking up digital cricket and AFL rights beginning this year and into 2025 will be interesting to watch, especially given the audience profile of consumers watching BVOD.

“Having those viewers in an always-on fashion sitting inside 7plus is going to be a really significant revenue win for them and I think those two deals alone could potentially grow the overall BVOD market by 15 to 20%,” he says.

“From an audience perspective, it's going to introduce audiences into 7plus that may never have tried that before and once you've got them into the app, then you start cross selling, you start recommending content, you start engaging with them through one to one marketing and recommendations and you can start to drive that light viewing behavior into regular and repeat behavior.”

With retail media on the rise both locally and globally, Bayes tells AdNews that retail data and measurement has the opportunity, when overlaid with BVOD and premium video inventory, to challenge the role of what television historically has been in a marketers mix.

"It will give the opportunity for you to activate every type of campaign and to measure it effectively from big brand campaigns right the way through to more performance led campaigns," he says.

"Everybody talks about TV as being the most powerful channel that there is, but you couple that with the richness of first party data and retailer data and from a targeting perspective that not only unlocks unbelievable efficiency, but it also allows you to prove it through measurement as well."

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